Tesla Stock Is Up. Elon Musk's EV Maker Is Investment Grade. -- Barrons.com

By Al Root

Tesla investors recently got some good news from Fitch.

The bond rating firm assigned the electric-vehicle maker an investment-grade BBB rating on Monday evening. It was Fitch's first rating, and signifies "good credit quality" with a low chance of default.

"Tesla's ratings reflect the company's strong market position as a global leader in battery electric vehicles (BEVs) and its focus on transitioning into a physical AI company," the report reads. Fitch expects that the BEV business will remain strong, but significant AI investments will lead to more debt down the road, which is why the rating might not be higher.

Tesla plans to spend some $25 billion on new plants and equipment in 2026, up from less than $9 billion in 2025. The company could fund that from its cash balance, but not solely from its EV business. Tesla is expected to spend about $10 billion more cash than it generates this year.

Tesla stock was up 0.7% in premarket trading at $377.87, while S&P 500 and Dow Jones Industrial Average futures were up 0.1% and 0.3%, respectively.

Shares might not be up more because Monday was strong. Tesla stock rose 3% as the tech sector rallied. What's more, the Fitch rating mirrors existing ratings from Moody's and S&P. And the new rating, while nice, doesn't really tell investors anything they don't already know about Tesla's spending plans or balance sheet.

Still, being investment grade is better than the alternative.

Write to Al Root at allen.root@barrons.com.

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September 22, 2026 07:36 ET (11:36 GMT)