Tesla’s sales in China rose sharply in May, closing at a record high

Tesla’s shares, which have doubled to $176.09 billion so far this year, closed at a record close of $949.92 on Monday after opening at $919. This is partly because China’s february sales of electric vehicles were positive.

Tesla's sales in China rose sharply in May, closing at a record high

Tesla sold 11,095 Model 3 electric cars made in Shanghai to Chinese customers in May, according to the China Passenger Vehicle Association. Overall, Tesla’s car sales in China fell in April, with fewer than 4,000 vehicles sold in April, as a result of the impact of the new crown outbreak on Chinese consumers and businesses. In May, Tesla sold 11,095 models, up 205 percent month-on-month, ranking first in domestic sales of new energy vehicles.

The drop in Tesla’s sales in April is likely to be related to the launch of the Chinese-made Model 3,its long-range version, as well as price adjustments. On May 1, Tesla China announced that it would reduce the pre-subsidy price of the Model 3 standard battery life upgrade from 3238 million yuan to 2918 million yuan, a decrease of 9.88 percent, plus the existing subsidy of 20.25 million yuan, the car’s arrival price will be reduced to 271.55 million yuan. To that end, Tesla suspended delivery of the Model 3 Standard Battery Extension, delayed April delivery until May, and some intended orders were diverted to the Model 3 rear-drive renewal. In addition, the Model 3’s long-range version began delivery in late May, giving Tesla a boost in May. It is worth noting, however, that Tesla has not partnered with the ride-hailing company to provide sales data, so the union’s data can only be used for reference.

Responding to possible sales figures in China, Tesla’s Dan Ives, of Wedbush Securities, wrote: “In the context of a significant increase in electric vehicle penetration over the next 12-18 months, we believe that Tesla’s growth in China will add $300 per share to the stock.” We maintain a neutral rating with a target price of $800 and a bull market target price of $1,350. “

JL Warren Capital, a New York-based china-focused equity research firm, says sales of Model 3s made in China are being driven by discounts and subsidies. In a report to investors last week, jL Warren Capital researchers noted that demand has shifted from long-range cars to short-range vehicles, driven by pricing changes and subsidies from China: “The sharp drop in LR orders in May was due to an 11 per cent drop in the Price of the M3 SR on May 1. Chinese consumers are delaying purchases because of Tesla’s capricing changes, hoping to cut THE price of THE LR (Long Life) further after July, as the model will no longer be eligible for government subsidies. “

Tesla's sales in China rose sharply in May, closing at a record high