Tesla (TSLAInventory fell on Tuesday as weekly vehicle registration data from China indicated that the global EV giant’s year-end incentives weren’t enough to support Tesla deliveries.
Insurance data indicated that total sales of new energy vehicles (NEV) in China from December 19 to December 25 were about 182,000 units. That’s 48% higher than a year ago and a 12.6% increase from the previous week, CnEVPost reported Tuesday. However, despite year-end discounts, Tesla registrations fell to an estimated 8,915 per week. Tesla’s registrations for the first three weeks of December were 11,670, 12,977, and 10,254, respectively.
With China easing Covid restrictions, there have been reports of widespread virus outbreaks across the country. Tesla China and other automakers in China have warned that deliveries and production will likely drop due to Covid disruptions.
On Tuesday, Reuters reported that Tesla halted production on December 24 at its Shanghai facility. Workers are scheduled to return on January 1, 2023. Tesla will run production for 17 days in January between January 3 to January 19 and halt electric vehicle production from January 20 to January 31 for the extended Chinese Lunar New Year holiday, accordingly. to Reuters.
The year-end production outages have been widely reported in recent weeks. Tesla’s Shanghai plant had already slowed production earlier in the month, with inventories building rapidly despite price cuts in late October and big incentives at the end of the year.
Tesla, which previously denied suspending production, said the shutdown was for planned annual maintenance.
Tesla stock fell more than 11% to 109.10 inches Tuesday trade. Last week, Tesla stock fell 18% to 123.15 after falling 16.1% in the previous week. These are the worst weekly losses since the Covid crash in March 2020. TSLA stock has fallen to a 27-month low, down 73% from its November 2021 peak.
China EV Recordings
Despite Covid, BYD still posted huge weekly deliveries of electric vehicles last week, even as Tesla and Neo dropped from week to week.
In the week ending December 25, BYD vehicle registrations were 51,636 compared to 50,462 and 44,817 in the previous two weeks. BYD said last week that Covid cases among workers are cutting production by 2,000 to 3,000 cars per day.
Nio’s enrollment estimate fell to 2,690 from 3,464. On Tuesday, Nio cut guidance on deliveries in the fourth quarter, citing the Covid outbreak.
The EV startup now expects to deliver 38,500-39,500 vehicles in the fourth quarter, off prior guidance of 43,000-48,000. That would mean December sales of 14,263 to 15,263 — which would still be a record.
The company said in a statement that it “faces challenges in delivery and production operations, along with certain supply chain restrictions, caused by the outbreak of the Omicron coronavirus variant in major cities in China.”
China has lowered the state of emergency for the coronavirus outbreak, despite reports that infections are increasing at a rapid rate. China is also ending quarantine rules for inbound travelers, as well as easing airline capacity and international travel restrictions, on January 8.
Fellow EV company in China Lee Otto (L.IRegistrations improved to 5,155 from 4,558 and 3,013 last week. XPeng (XPEV), another company trying to challenge Tesla in China, had 2,536 versus 3,257 in the previous week.
Tesla Stock: Looking Ahead
Tesla will likely release fourth-quarter and full-year deliveries on January 2nd. It is expected to submit its own report in early January.
Over the weekend, Nio unveiled the EC7 coupe SUV, which will likely rival the Tesla Model Y in the high-end market. Shipments of the EC7 will begin in May 2023. Nio also unveiled a refreshed ES8 SUV, now on the NT 2.0 platform like its all-new models. Deliveries begin in June.
As analysts ring warning bells for the auto industry in 2023, electric vehicle manufacturers in China have announced new models and outputs while Tesla has maintained its model approach in China.
Along with Tesla stocks, electric vehicle manufacturers in China posted losses on Tuesday. Nio stock fell 8.2%. LI and XPeng shares fell more than 1%. BYD stock, which is traded OTC, was trading slightly lower.
Please follow Kit Norton on Twitter @employee for more coverage.
You may also like: