GLJ Research Explores Report Tesla (TSLA) Dumped 1,000 Model 3s at 20% Discount to CATL Employees in Q1
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GLJ Research analyst Gordon Johnson weighed in on Tesla (NASDAQ: TSLA) related to a report the company offered a 20% discount to move 1,000 Model 3s in China to CATL employees in Q1. CATL is a major partner of Tesla in China.
Commenting on why a move like this would be so important, Johnson said, "Well, there would be NO reason for TSLA to sell 1,000 cars at a 20% discount IF they had orders for those cars that had no discount. Thus, at the end of 1Q21, TSLA ran out of orders for its cars, and thus had to give 20% discounts on cars that had already seen price cuts of 19-30%."
This is a problem for Tesla if they have to cut prices in its high growth market, Johnson added.
The analyst states that companies such as VW only open offers to employees when all backorders of new models are done and capacity possible.
"Thusly, you have one car company offering LARGE, end-of-quarter, discounts to its suppliers, in return for fleet sales to its suppliers employees (i.e., inorganic demand, and a company that is NOT production constrained) – this company being TSLA; and, you have another car company that is truly production constrained, and thus doesn’t have discounted cars for even its own employees (this company being VW)," the analyst noted.
Separately, Johnson knocked Tesla CEO Elon Musk for another "lie" on Model S/X production. In its recent Q1 delivery production report, the company stated it didn't produce any S/X models in the quarter. However, the company made a statement in the recent past that it would be producing Model S Plaid as of 01/27/21.
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