Tesla's China Factory Shipments Down 19% YoY... Stock Price Drops 7%

February shipments approximately 60,000 units, lowest performance in 14 months
Factors include Spring Festival, intensified price competition, and weakened demand in China

The shipment volume from Tesla's Shanghai factory, an American electric vehicle company, has dropped to its lowest level in over a year. This is attributed to a sales lull during the Chinese Lunar New Year (Chunje) holiday period and intensified price competition.

According to preliminary data from the China Passenger Car Association (CPCA) reported by Bloomberg on the 4th (local time), Tesla's China factory shipped 60,365 units last month, marking the lowest performance in 14 months. This represents a 16% decrease compared to January shipments and a 19% decline year-over-year.

[Image source=Yonhap News]

In China, vehicle sales typically slow down in months that include the Chunje (Lunar New Year) holiday, but the communication pointed out that the overall slowdown in China's new energy vehicle market is also a factor behind this poor performance. According to CPCA's latest estimates, total sales of 'new energy' vehicles, including electric vehicles and plug-in hybrids, reached 450,000 units last month, down 9% from the same month last year.

CPCA analyzed that competitive price cuts by major electric vehicle manufacturers may have led consumers to postpone purchases. To survive competition with local electric vehicle companies like BYD, Tesla is offering various incentives such as insurance subsidies worth $1,110 (approximately 1.5 million KRW) and preferential installment programs to buyers of certain vehicle models. Amid Tesla's aggressive price cuts, BYD's sales also fell by 37% year-over-year to 122,311 units last month, down from 193,655 units in the same month last year.

Troy Teslike, an analyst in the electric vehicle industry, recently downgraded Tesla's estimated global deliveries for the first quarter of this year to 450,000 units, analyzing that "Tesla's poor performance despite price cuts suggests that there is a problem with demand itself in China."

On the same day, Tesla's stock price on the New York Stock Exchange closed at $188.14, down 7.16% from the previous session. Tesla's stock price has fallen 24% so far this year up to that day.