Tesla and GM Preferred at Goldman Sachs

Despite Tesla’s (NASDAQ: TSLA) recent share price decline, Goldman Sachs analyst Mark Delaney said in a 2023 note on US autos and industrial tech that the firm continues to prefer the electric vehicle leader and GM among automakers.

The analyst told investors in his research memo that he believes the weak macro backdrop will “make for a challenging and choppy fundamental environment in 2023.”

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In relation to Goldman’s global auto research colleagues, Delaney reduced his fourth-quarter global auto production forecast to 21.6 million units from 21.9 million units due to the rise of Covid cases in China. However, his 2023 global auto production forecast was raised to 84.8 million from 82.7 million units, “driven entirely by China.”

Delaney explained he will continue to be selective with automaker stocks as the price and mix are likely to be headwinds in 2023, but he continues to prefer Tesla and General Motors. The analyst has a Buy rating and $205 price target on Tesla shares and a Buy rating and $42 target for GM.

Elsewhere on Wednesday, Bloomberg reported that Tesla is nearing a move to close a preliminary deal to set up a factory in Indonesia.

The Elon Musk-led electric vehicle maker is aiming to capitalize on the Southeast Asian nation’s key battery metals reserves, Bloomberg said, citing people familiar with the matter.

The publication added that the plant would produce up to 1 million cars a year, with the plant discussions including plans for numerous facilities in the country serving various functions, including the production and supply chain.

Tesla’s stock price climbed 3.68% on Wednesday but is down 0.7% premarket Thursday.