Trip Chowdhry Comments On Tesla's New Hire

recently announced it named Ganesh Srivats to head the company's North American sales. Srivats was brought over from Burberry and replaced Gerome Guillen who was shifted to Services at Tesla. Trip Chowdhry of Global Equities Research commented on the hiring on July 2, noting that the executive actually joined the company in early May and "further validates" that Tesla is not an automotive company in the traditional sense, rather an auto company with its own retail stores and other key production facilities. "If Tesla was a typical auto company, they were better off hiring a sales executive from

,

or

etc," Chowdhry wrote. "Tesla has its own Retail Stores, its own Gas Stations (Super Charging Stations), its own Refineries (Giga Factory), hence we think hiring Ganesh Srivats from Burberry makes sense." Shares were reiterated with an Overweight rating and $385 price target.

Chowdhry commented in a previous note at the end of June that Tesla is "very likely" to exceed their second quarter delivery guidance (10,000 to 11,000 units) and production guidance (12,500 units). The analyst estimated the company may have delivered 11,250 units in the quarter and produced 13,100 units. Chowdhry also noted that based on checks, around 90 percent of cars on delivery trucks were "D" models which come with a 5 percent to 7 percent higher average selling price. The analyst suggested that this indicates customers have a "very strong" preference for higher priced D models and the company may "pull the plug" on its base S model offering.