Tesla (TSLA) China Sales Up 26% in September Amid 'Massive Demand Momentum,' Total China Car Sales Down 17% on Growing Chip Frustrations
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Tesla (NASDAQ: TSLA) sold a record 56,006 China-made cars in September, the China Passenger Car Association data showed. In August, Tesla sold 44,264 units.
Sales of cars in China fell 17% in September to 1.58 million. This marks the worst drop YoY since March last year and the start of the pandemic. For the three months from July, sales fell 13%.
Carmakers have struggled to cope with the demand amid the ongoing chip shortage. Furthermore, industry experts have outlined weaker consumer confidence as one of the reasons behind the slowdown.
“The inventory level is at an all-time low,” said Guan Bolang, a Toyota dealer in Guangzhou.
Toyota Motor (NYSE: TM) said sales of its cars in China fell sharply by 35.9% to 115,000 cars due to the chip shortage. As a result, the company was forced to halt production at some factories. Similarly, Honda and Nissan reported a 28.1% and 26.2% drop, respectively, for September.
Wedbush analyst Daniel Ives said the latest CPCA numbers reflect a “massive demand momentum into year-end.”
“Selling 50k+ in the month for the key China region speaks to huge trajectory that highlights our bull China thesis for Tesla going into the next few years. We believe in the month of September alone Tesla delivered roughly 150k vehicles and is a clear indicator of this green tidal wave taking hold for Musk & Co. across the board. As evidenced this morning and in line with our thesis, China demand rebounded in the quarter and is clear indicator of the step up in EV demand taking place globally with China leading the way,” Ives said in a client note.
The Wedbush analyst rates TSLA stock with an Outperform rating and a $1,000.00 per share price target.
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