Tesla Stock Melts Like Ice Under Sun

Tesla posted fewer vehicle sales than the year before, the first in the manufacturer’s history. The EV manufacturer reported a drop in yearly shipments from its Shanghai factory, the first since the facility started mass production in 2020, which caused Tesla stock to drop more than 6% at premarket trade.

 

This outcome is specifically explained by a 3–9% decrease in production impacted by temporary site closures. Sites in Texas and China were temporarily closed for modernization work, while the manufacturer’s massive factory in Germany was the target of an arson attack followed by a strike.

The increased level of competition has also hurt the company. The American automaker set a record in the three months leading up to December 31 by delivering 495,570 vehicles. LSEG polled 15 analysts, which stated that 503,269 units were needed.

The total amount of deliveries for 2024 was 1.79 million, which is 1.1 percent less than the previous year. The 19 analysts that LSEG polled had an average estimate of 1,806 million units.

However, the electric vehicle manufacturer, announced on Friday that its sales in China increased by 8.8 percent to a record high of over 657,000 cars in 2024.  This is a strong performance in a competitive market during a year in which its yearly global deliveries fell for the first time.

According to Tesla China, Tesla vehicles in the biggest auto market in the world climbed 12 percent in December compared to the same month the previous year, reaching a record high of 83,000 units.

China is Tesla’s second-largest market, and according to sales data, 36.7 percent of its vehicles were delivered to Chinese consumers in 2024. Elon Musk earlier predicted a slight increase, but worldwide deliveries fell 11%—reduced subsidies from Europe.

The move to more affordable hybrid cars and increased competition worldwide, particularly from BYD in China, hurt sales.

Tesla was still ahead of BYD, whose EV sales increased 12.1 percent to 170 million worldwide The EV giant reduced the size of its China sales team and its global workforce due to weak demand and increased competition from Chinese EV manufacturers.

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Olumide Adesina
Olumide Adesina
Financial Market Writer
Olumide Adesina is a French-born Nigerian financial writer. He tracks, analyzes, and reports changes in financial markets with over 15 years of working experience in investment trading.
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