EU Pitches Gigafactory Deal with Tesla CEO Musk; How Is AI Connected?


TL;DR Breakdown

  • European leaders are actively engaging with Tesla CEO Elon Musk during his visit to the continent, aiming to persuade him to establish a new Gigafactory in Europe.
  • Italy’s Prime Minister and Foreign Minister have already met with Musk, discussing various topics and showcasing Italy’s interest in hosting a potential Gigafactory.
  • Emmanuel Macron, the president of France, will meet with Musk to discuss AI, social media, and the legal system while pitching France and Europe as desirable locations for Tesla’s Gigafactory.

Elon Musk, the CEO of Tesla, is touring Europe in anticipation of the rumored construction of a new electric vehicle (EV) production facility. He is meeting with authorities from several governments. European leaders are seizing the opportunity to persuade Musk to establish a new Gigafactory in the region. The outcomes of these discussions could have significant implications for the European EV market and Tesla’s expansion plans. Among the top Wall Street analysts covering Tesla, there is a mixed consensus, with a moderate buy rating and an average price target of $207.07.

European efforts to attract Tesla

In their pursuit of Elon Musk’s attention, European leaders have been actively engaging with the CEO during his visit to the continent. These efforts highlight their desire to secure a new Gigafactory and leverage Tesla’s expertise in the growing EV sector.

Giorgia Meloni, the prime minister of Italy, and Elon Musk met on Thursday, right before the Viva Tech Conference in Paris. The threats posed by artificial intelligence (AI) and birth rates were only two of the many subjects they discussed. In a tweet confirming the meeting, Prime Minister Meloni emphasized the significance of the different topics covered. This gathering demonstrates Italy’s desire to potentially host a Gigafactory within its borders.

Musk spoke with Antonio Tajani, the foreign minister of Italy, in addition to the prime minister. These discussions centered on the automotive and aerospace industries, demonstrating Italy’s desire to attract Tesla’s investment to the nation.

Elon Musk also has a meeting scheduled with Emmanuel Macron, the president of France, for his European journey. During the discussion, President Macron stated that he plans to promote AI, social media, and the legal framework. He also seeks to promote the attractiveness of France and Europe as potential locations for a Tesla Gigafactory. This meeting underscores the French government’s commitment to encouraging investment in the EV industry.

Tesla’s market outlook and analyst opinions

While European leaders vie for Tesla’s attention, market analysts continue to assess the company’s prospects and provide recommendations for investors. Among the top Wall Street analysts covering Tesla, opinions on the stock are mixed. Out of the 17 analysts, nine have assigned a buy rating, seven rate it a hold, and one has a sell recommendation. This consensus leans towards a moderate buy. The average price target for Tesla stands at $207.07, indicating a potential downside of 19.1%.

Bernstein analyst Daniel Roeska has reaffirmed his sell rating on Tesla’s stock, accompanied by a $150 price target. Conversely, three other analysts, namely RBC Capital, Wedbush, and Morgan Stanley, have recently issued buy ratings. RBC analyst Tom Narayan even increased his price target from $212 to $305, expressing optimism about Tesla’s autonomous driving technology. These contrasting viewpoints reflect the ongoing debate surrounding Tesla’s valuation and future prospects.

Is the future of EV manufacturing in Europe tied to AI?

As Elon Musk engages with government officials across Europe, the region’s leaders are actively wooing him to establish a new Gigafactory. Discussions with Italy’s Prime Minister and Foreign Minister, as well as the planned meeting with the French President, exemplify the European Union’s commitment to attracting Tesla’s investment. Meanwhile, the divergent opinions of market analysts regarding Tesla’s stock performance further contribute to the ongoing discourse surrounding the company’s outlook. The outcome of these interactions and decisions made by Tesla’s leadership could significantly impact the future of manufacturing in Europe and Tesla’s global expansion plans.

Two days ago, On June 14, 2023, the European Parliament (“EP”) approved its negotiating mandate (the “EP’s Position”) regarding the EU’s Proposal for a Regulation laying down harmonized rules on Artificial Intelligence (the “AI Act”). The vote in the EP means that EU institutions may now begin trilogue negotiations (the Council approved its negotiating mandate on December 2022). The final version of the AI Act is expected before the end of 2023.

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Aamir Sheikh

Amir is a media, marketing and content professional working in the digital industry. A veteran in content production Amir is now an enthusiastic cryptocurrency proponent, analyst and writer.

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