Tesla’s value drops $50 billion after Musk’s announcements

Tesla's value drops $50 billion after Musk's announcements

Investors slashed $50 billion from Tesla Inc’s market value after CEO Elon Musk’s promise to cut electric vehicle costs so radically that a $25,000 car that drives itself will be possible, but not for at least three years.

Tesla’s market cap dropped $20 billion in just two hours after trading closed Tuesday, as Musk and other Tesla executives presented their new battery and manufacturing strategies.

Investors had expected two significant announcements at Musk’s oft-touted “Battery Day”: The development of a “million mile” battery good for 10 years or more, and a specific cost reduction target that would finally drop the price of an electric vehicle below that of a gasoline car.

Musk promised over the next several years to slash battery costs in half with new technology and processes and deliver an “affordable” electric car.

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