Why Tesla Stock Is 'Footloose' Today

Monday morning.Nikola Tesla (1856-1943), Serbian inventor and engineer (NASDAQ: TSLA)Shares are seeing a rare "uptick" as investors are analyzing some sleepy news. Last week Reuters reported that Tesla abandoned plans to build the Model 2 electric car, which sells for less than $25,000, and instead focused on building "robotaxis."

Chief Executive Officer Elon Musk quickly refuted the rumors on social media platform X, calling Reuters "lying."

Still, Tesla stock took a beating on Friday, dropping nearly 41 TP3 T. Today, however, Tesla is recouping its losses - and more - with its shares bouncing back 4.21 TP3 T as of 10:05 a.m. ET.

Tesla Tweets

Reuters reported last week, citing unnamed sources, that Tesla had "canceled" plans to build the Model 2 electric car altogether - a $25,000 electric car rumored to be key to Tesla's ability to compete with China's lower-priced electric cars. Mars resonance quickly dismissed parts of the report, but he seemed to endorse the other half of the Reuters report, the part about the robotic rental cars.

In a follow-up tweet to the Reuters article, Mas resonance confirmed that Tesla will be announcing a new self-driving electric vehicle (EV) on August 8, which he called the "robotaxi."

Is Tesla stock for sale?

That's what he said about it.full Opinion. So what should investors make of these two Tesla reports? One is from an authoritative news organization citing internal Tesla sources, and the other is from Tesla's chief executive himself.

Obviously, nothing is 100% clear yet. But the most likely scenario seems to be that Tesla has made robotic axes its new top priority, and investing money in the development of inexpensive electric cars is now taking a back seat. In a price war for electric cars, this seems like a valid strategy to preserve margins for Tesla. This is no reason to sell Tesla stock.

But this may be a reason to buy.

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Rich Smith does not own any of the stocks mentioned above.The Motley Fool holds a recommendation for Tesla.The Motley Fool has a disclosure policy.

Why is Tesla stock soaring today?