Tesla Stock Slumps on Weak China Deliveries, EV Charger Funding Suspension
Tesla (TSLA) has faced a challenging week, with shares set to decline nearly 9% after a report showed a decline in China deliveries. Data from the China Passenger Car Association revealed a 11.5% year-over-year drop in Tesla's January sales, while competitor BYD experienced a 47% surge.
Chinese deliveries of Tesla's Model 3 and Model Y produced in the country decreased by 32.6% compared to December. Tesla had offered a 0% interest plan to bolster sales throughout January, following price cuts in China and other markets last year.
Tesla's struggles extend beyond China, with registration data indicating a plunge in sales in Germany to pre-2021 levels and a downturn in other European markets. This has raised concerns among investors about whether CEO Elon Musk's political involvement may be deterring potential buyers.
Tesla gained significantly during the "Trump trade" after the 2016 presidential election, benefiting from Musk's perceived closeness to former President Donald Trump. Despite a year-to-date decline, shares have still risen over 45% since the election day.
Adding to Tesla's woes, the Department of Transportation has announced the suspension of federal funding for the rollout of EV charging stations in the US. The agency will review its policies, and new guidance is expected this spring. Stocks of charging station makers ChargePoint (CHPT), Blink (BLNK), and EVgo (EVGO) have declined by over 7%.
Tesla has reportedly received an estimated $31 million in funding through this program, highlighting the importance of charging station availability for widespread EV adoption.