Tesla shares fall amid investor concerns about growth plans and productivity

Tesla’s stock declined further on Tuesday after starting off the week with yet another tumble exacerbated by investor worries regarding the automaker’s ballooning costs and safety issues surrounding the company’s electric car Autopilot system.

Tesla’s stock is down 2.69% after losing 3.8% on Monday to close at $203.03. The company’s stock is now more than 11% down since the U.S.  National Transportation Safety Board (NTSB) said last week Thursday that the Model 3 car had its Autopilot system engaged when it got involved in a fatal collision on March 1.

Intraday trading on Monday saw the stock sank below $200 per share, the first time Tesla shares had dropped to that level since December 2016.

Investors have also raised concerns with the automaker’s growth plans as envisioned by Elon Musk in an email sent to employees last week.

Other than saying he planned to cut costs, Musk also noted that the $2.7 billion the company raised recently in fresh capital would give the company about 10 months only as time in which it must break even if it continues to burn cash at the rate it did in the first quarter.

The Tesla stock is also feeling the pressure after Daniel Ives, an analyst at Wedbush moved to cut the stock’s price target to $230, down from $275. The analyst wrote that there are “major concerns” with regard to Tesla’s growth forecasts and said the company faces a “Herculean task” in its quest towards profitability.

Ives called Tesla’s situation “code red” and noted that instead of Musk & Co. shoring up Model 3 demand, they are looking to expand into diverse fields as robotaxis, insurance, and several other sci-fi projects.

The stock is down 40% year to date. Refinitiv has 10 analysts who have recommended buying, 9 are neutral, while 12 recommend selling. The analysts have given the firm’s shares a median price target of $250, downgrading it from $300 given in mid-April. Tesla’s valuation on the stock market has tumbled, falling below both General Motors and Ford Motors that it had surpassed in 2017 as the outlook on Model 3 climbed. At the moment, Tesla’s market capitalization stands at about $36 billion.