GUNDLACH TO MUSK: Drop The Cars And Stick With Batteries

Tesla elon muskREUTERS/StringerElon Musk, CEO of Tesla Motors, waves during a news conference to mark the company’s delivery of the first batch of electric cars to Chinese customers in Beijing April 22, 2014.

In the past year or so, the Tesla story has morphed from one about electric cars upending the auto industry to changing how we get our energy everywhere, thanks to the automaker’s announcement that it plans to build a giant battery factory.

DoubleLine Capital founder Jeff Gundlach says its time for Tesla founder Elon Musk to pick a narrative — the latter one, specifically.

In an interview with Bloomberg News yesterday, Gundlach laid out a strategy by which Tesla goes all-in on batteries, and leaves the actual car manufacturing to existing giants.

Tesla “could be wildly transformational the way electricity and electromagnets were,” Gundlach said according to Bloomberg’s Mary Childs.

He added that he sees a 30% Tesla will give speculative investors a “killer” return.

And he couldn’t resist taking a swipe at Twitter, which fell nearly 18% yesterday after a proprietary lock-up expired.

“What does Twitter (TWTR) create? It creates information flow but it’s not really creating anything,” Gundlach said. “If you’re going to buy a high-flier, I would rather own Tesla.”

Gundlach also discussed what the Fed should be doing, and where he thinks China is going

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