Shares of Tesla (NASDAQ:TSLA) declined on Tuesday ahead of its upcoming “Battery Day” presentation. As of 9:50 a.m. EDT, Tesla stock was down 5%.
A series of tweets sent by CEO Elon Musk late on Monday is likely contributing to the decline. In an attempt to reign in investors’ expectations, which have grown sky-high in the weeks leading up to Tesla’s “Battery Day” event, Musk tweeted:
Important note about Tesla Battery Day unveil tomorrow. This affects long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2022.
— Elon Musk (@elonmusk) September 21, 2020
The news was disappointing to investors who were hoping Tesla would be able to reach mass production of its new batteries by next year. Analysts see Tesla’s battery technology advances as a key point of differentiation with its electric vehicle rivals.
However, Musk said Tesla would need to rely more on its current suppliers until it can ramp up its own battery cell production. “We intend to increase, not reduce battery cell purchases from Panasonic, LG & CATL (possibly other partners too),” Musk said on Twitter.
Musk did note that Tesla would need to “take action” to address the “significant shortages” in battery cell production beginning in 2022. However, he also warned about the “extreme difficulty” of scaling up production of the company’s new battery technology.
“It’s 1000% to 10,000% harder than making a few prototypes,” Musk said. “The machine that makes the machine is vastly harder than the machine itself.”
Investors can tune into Tesla’s Battery Day presentation on the company’s website later today. The event will take place after Tesla’s 2020 annual meeting of stockholders, which is scheduled to begin at 4:30 p.m. EDT.