Tesla Vs. Honda: Which Auto Manufacturer Is A Better Buy?

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Auto manufacturing juggernauts Tesla, Inc. (TSLA) and Honda Motor Co., Ltd. (HMC) have witnessed a large improvement in sales since the latter half of 2020. Thanks to the overall demand recovery in the auto sector and ramped-up manufacturing capacity, these two companies are poised to climb further in the coming months.

While TSLA has been the top-selling plug-in and electric car manufacturer, HMC has retained its position as one of the largest manufacturers of internal combustion engines.

The auto sector has been slowly and steadily returning to health after being battered by the pandemic last year. This revival should further boost the sales of TSLA and HMC. Although regaining pre-pandemic sales numbers could be challenging, the two companies have positioned themselves to emerge stronger from the pandemic.

While TSLA gained 417.6% over the past year, HMC returned 25.9%. In terms of their past month’s performance, HMC is the clear winner with 0.3% gains versus TSLA’s negative returns. But which of these stocks is a better pick now? Let’s find out.

Latest Movements

TSLA plans to roll out Tesla Cybertruck, Semi, and Roadster this year. Its electric pickup truck factory, the Gigafactory, is currently under construction and could be ready to build vehicles as soon as May this year. Also, last December, TSLA was finally added to the S&P 500 Index after five consecutive quarters of profit.

Last year, the company surpassed the half a million mark in electric cars produced and delivered. Moreover, TSLA’s Model Y production in Shanghai has commenced, with deliveries expected to begin shortly.

Also last year, HMC and General Motors (GM) signed a memorandum of understanding to accelerate innovation in electric vehicles (EVs) and collaborate on a variety of other segments to share common vehicle platforms in North America. The strategic relationship should allow HMC to invest significantly in future mobility technology and create new value for its customers.

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