What a shock — Corvette sales soar as Tesla stock price plunges

Grae Stafford Freelance Photographer
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Super trendy electric car manufacturer Tesla has seen “it’s biggest one-month loss of market value” according to Bloomberg news.

Tesla lost 17 percent of its value in the month of October. This means that the value of the Palo Alto based company has slipped from its peak of $23.5 billion to $19.4 billion. Bloomberg notes that the company’s loss of value in the month of October is higher than its entire market valuation at the beginning of 2013.

This slide has been blamed on a readjustment of expectations as the company attempts to come to grips with the challenges facing it now that the initial surge of public interest has waned and the company grapples with the realities of the car market. Ben Kallo, an equity analyst for Robert W. Baird & Co. in San Francisco was quoted by Bloomberg as saying “The stock is priced to perfection right now.” Kallo recently downgraded his rating for the stock from “Outperform” to “Neutral.”

The company is facing more challenges including the need to boost production numbers of its models — including an all-new electric SUV. It also needs to expand its dealer network to compete with the likes of GM and Ford. Tesla’s fellow electric car manufacturer Fisker has been hit with high-profile failures, and in October two of Tesla’s S-Models caught fire.

Another issue being faced by Tesla is the State of California’s proposed scaling back of zero-emission vehicle credits, possibly by as much as 40 percent.

Speaking on Bloomberg TV recently, Tesla’s biggest investor and co founder Elon Musk said, “The stock price that we have is more than we have any right to deserve.” It appears that the market agrees with Musk. The recent stock wipeout eliminated value roughly equivalent to the GDP of Montenegro.

For the Corvette brand, however, October was a barnstormer. As the new 2014 model hitting the show room, sales are up by triple digits. Automotive news reports:

A breakdown of the sales of the new model conducted by in September foresaw the expected sales surge. Nearly three quarters of ‘Vette buyers are going for the high performance Z51 models.

To further ram home the point that electric cars haven’t caught the public’s imagination, sales of GM’s own plug-in hybrid, The Volt, were down 2.7 percent, selling only 18,783 units in the first ten months of 2013.

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