Tesla Stock Plunges on Weak Delivery Data and Political Concerns
Tesla (TSLA) shares have endured a tumultuous week, with the electric vehicle (EV) giant set to lose nearly 9% in the past five trading days. This decline follows a report indicating a significant slump in Tesla's China deliveries.
According to data released by the China Passenger Car Association, Tesla's China sales plummeted by 11.5% year-over-year in January. Meanwhile, Chinese rival BYD witnessed a surge of 47% in its annualized sales. Notably, deliveries of Tesla's Model 3 and Model Y produced in China saw a 32.6% drop from December.
Tesla, in an attempt to boost sales, implemented a 0% interest rate plan throughout January. Additionally, the company has been lowering vehicle prices in China and other markets over the past year.
These developments follow separate registration data revealing that Tesla's sales in Germany reached their lowest point since 2021. Sales also experienced declines in other European markets, raising investor concerns about whether CEO Elon Musk's political involvement is alienating potential buyers.
Tesla's stock had emerged as a major beneficiary of the "Trump trade" following the 2020 presidential election, as investors anticipated advantages from Musk's close ties to President Donald Trump. Despite the current downturn, Tesla shares remain over 45% higher since November 5, 2020, the day of the election.
In further news, the Department of Transportation announced the suspension of federal funding for the rollout of EV charging stations across the United States. The agency intends to review existing policies, with new guidelines expected this spring. This decision has impacted charging station makers such as ChargePoint (CHPT), Blink (BLNK), and EVgo (EVGO), with their shares dropping by more than 7%. Tesla has reportedly received an estimated $31 million through this program, highlighting the critical role of charging infrastructure for the widespread adoption of EVs.