Tesla (NASDAQ: TSLA) stock tumbled over 7% on Monday after the company saw a decline in February China sales.
Tesla (TSLA) saw a notable dip in its February sales in China. The China Passenger Car Association data revealed that Tesla sold 60,365 electric vehicles. This figure showcases an 18.87% decline compared to the previous year and a 15.51% drop from January’s 71,447.
The dip in sales comes as China celebrated its Lunar New Year holidays, leading to a slowdown in car purchasing activities. Concurrently, Tesla responded to intensifying competition from local rivals like BYD by implementing several price cuts and incentives.
Last week, Tesla introduced new incentives, including insurance subsidies, to entice consumers in the world’s largest auto market.
Meanwhile, in the United States, the company announced an offer of 5,000 free Supercharging miles to customers purchasing new vehicles before March 31. In addition, the EV giant temporarily slashed prices on select Model Y cars in the U.S. during February.
Analyst Troy Teslike recently revised his estimates for Tesla’s global deliveries in the January to March period to 450,000. He cautioned that weaker-than-expected China sales might indicate a broader “demand problem, ” even with the price cuts.
In January, Tesla had already signaled expectations of “notably lower” sales growth for the year as it shifted its focus towards ramping up production of its more affordable electric vehicles.
Tesla (NASDAQ: TSLA) Stock Reaction
TSLA stock plunged 7.16% to close at $188.14 on Monday. The traders had exchanged hands with 133,095,898 (133.09 million) shares compared to the average daily trading volume of 108.54 million.
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