It appears that Tesla is headed even further into turbulent territory with China, as the EV maker’s orders in the communist country fell sharply in May.
According to The Information, which cited a source familiar with the data, Tesla’s monthly net orders to China fell from 18,000 in April to approximately 9,800 last month. “The electric car pioneer grappled with public outcry and government criticism over its handling of consumer complaints. Taken together, the developments put in doubt Tesla’s vaunted position and success in the world’s biggest electric vehicle market,” the San Francisco-based tech news company added.
This caused Tesla’s shares to tumble even further on Thursday, especially after a US regulator also on Thursday revealed that over 5,500 Model 3 and Model Y vehicles were being recalled over seat-belt concerns.
China has been one of the EV maker’s largest consumer base, as well as its most critical one. Tesla’s Shanghai factory has been the main driving factor that has allowed it to meet Wall Street’s optimistic expectations, particularly with respect to production and sales targets.
However, as the number of disgruntled Chinese Tesla owners continue to grow, the EV maker may soon face an even bigger crisis. The company’s market share in the world’s largest car market is receding— and fast. Tesla’s market share fell from 19% in March to 8% in April, while legacy automaker General Motors saw its market share jump to above 20%.
Information for this briefing was found via the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.