(This story is for CNBC Pro subscribers only.) The coronavirus crisis will allow Tesla to increase its lead in the electric vehicle space as other automakers focus on recovering from the economic damage due to the shutdowns, said Credit Suisse. The Wall Street firm upgraded shares of Tesla to neutral from underperform, sending shares of the electric automaker up 9.1% on Tuesday. Credit Suisse hiked its price target to $580 per share from $450 per share, implying Tesla's stock will fall 12% from its current level of $650.95 per share. "It competitively has more edge in the transition to EV as coronavirus disruption will make it more difficult for legacy automakers to balance the long-term shift to EV in the face of near-term cycle disruption," Credit Suisse research analyst Dan Levy said in a note to clients on Tuesday. The fast-spreading coronavirus has caused unprecedented financial and societal disruption in the U.S. The economy is essentially shutdown and the drop in economic activity is likely to hurt corporate cash flows, potentially creating liquidity issues and pressuring capital return plans. Credit Suisse's theory is that legacy automakers — like Ford, Fiat Chrysler and General Motors — will have to put down their plans for electric vehicle production while they are focused on a recovery from the coronavirus crisis. The firm said Tesla's competitive advantage in the electric vehicle world has increased as the coronavirus disruption forces automakers to make tough decisions about product investment. "The auto industry is facing a challenge in balancing the 'near' (cyclical) with the 'far' (secular). We believe coronavirus disruption makes that balance all the more difficult," said Levy. In the near term, demand is expected to soften for Telsa; however, Credit Suisse is still estimating the electric automaker will be producing 1.2 million units by 2025. Credit Suisse's revised 2020 earnings is 11 cents per share, compared to its previous estimate of $9.76 per share. Shares of Tesla are up nearly 70% this year. — with reporting from CNBC's Michael Bloom.
