Tesla saw a decrease in China sales this past month that was faster than the broader market after warnings about constraints regarding capacity at its Shanghai gigafactory.
Tesla (TSLA) shares increased this week after the information from China showed a decrease in sales per month as the supply-chain problems continue to lessen capacity at its gigafactory in Shanghai.
Shares had a boost this week, as well, by an Exchange and Securities Commission filing showing Adage Capital Partners had raised its stake in the group by 21.3 percent, to 824,300 shares.
Tesla has sold 59,845 cars that were made in China in Jan., a 15.5% drop from the automaker’s record Dec. amount of 70,847 units in its most important market.
However, the total of the China car sales only dropped 1.4% from Dec. to Jan., to 2.11 million cars, and Tesla’s biggest rival NIO saw sales drop 8% to 9,652 cars. Xpeng sales decreased 19.2% down to 12,922 units sold, the CPCA said.
Tesla warned earlier this year that supply-chain problems have slowed the production capacity and will affect the speed of near-term output, a caution that took part of the gloss from a record 4th quarter, which had revenues that rose 65 percent from the past year to a record high of $17.72 billion.
“For a while now, (Shanghai and Freemont) factories have been working under capacity because of some challenges with logistics and supply,” Zach Kirkhorn, Tesla’s CFO, told investors in late Jan.. “From what we are seeing, the speed of growth during 2022 will, again, be decided by logistics and supply chain, which is not easy for us to estimate.”
Tesla shares were priced 3.5% more in trading this week to sell at $890.54 each, a move that would slow the stock’s three-month decline to about 15%.
Late last year, Elon Musk said the Model S Plaid, their high performance luxury sedan, will become available in China around March.
The cost of the Plaid is $140,000, and it has a charge range of about 520 miles and it has been reported to have speeds up to 200 mph.
“With China being the largest EV market, Tesla’s determined production plans in the U.S. turned out to be productive. Growth in production of the Model y and 3 from its gigafactory in Shanghai is helping top-line increase,” said Nanda Sai, Crisp Idea analyst, who has a ‘buy’ rating with a twelve-month cost target of $1,087.00 on Tesla stock.
“The Shanghai gigafactory factory is growing in production and has a large market share in the China electric vehicle market and the business stays focused on more improvements that will raise production rates,” he said.