Tesla vehicle insurance registrations in China surged 28% last week, as the global EV giant's performance is closing the gap to third-quarter levels while it attempts to reach record Q4 output and the 1.8 million vehicle deliveries the company targeted for 2023. Meanwhile, preliminary deliveries of the Cybertruck are set to begin at the end of November. TSLA advanced Tuesday.
Tesla insurance registrations in China totaled 16,300 last week, up 28% from 12,700 the prior week and a 36% vs 2022, according to data compiled by CnEVPost. These numbers represent the third full week since Tesla began delivering its revamped Model 3 in China. Currently the numbers are not broken down to show Model 3 vs. Model Y registrations.
Tesla also raised the starting price of the Model Y Long Range in China by $344, the fourth consecutive weekly price increase on a Model Y trim going back to the end of the third quarter.
Meanwhile, Tesla begins deliveries of its Cybertruck in the U.S. at the end of November. On Monday, an analyst wrote that canceling the Cybertruck would "probably be positive" for TSLA shares.
Tesla stock gained 2.4% to 241.23 Tuesday during market action as Bloomberg reported India and Elon Musk are close to a deal to import Tesla vehicles to the country next year and set up a plant in two years.
On Monday, TSLA dropped early before adding 0.6% to 235.60. Tesla stock has gained more than 20% in November ahead of Cybertruck deliveries, planned to begin on Nov. 30.
Tesla Targets Record Q4
Tesla is looking to meet its goal of delivering 1.8 million vehicles in 2023. Seven-weeks into Q4, Tesla China insurance registrations, a rough gauge for vehicle deliveries, totaled 71,800 for the quarter, down around 2% compared to the same point in Q3.
With the first Cybertrucks coming at the end of November, the EV company unveiled its new Model 3 in China on Sept. 1 with official sales beginning on Oct. 19. Tesla started delivering the Model 3 on Oct. 26. The global EV giant also launched a slightly updated Model Y in China earlier in October.
Through the end of Q3, Tesla delivered about 1.3 million vehicles globally for the year, meaning the company needs to deliver 480,000 in Q4 to reach 1.8 million. That's 3% more than its record 466,000 deliveries in the second quarter. Tesla reiterated its 1.8 million vehicle delivery goal in its third-quarter earnings.
However, since Oct. 18, analyst projections have dropped. Wall Street consensus has Tesla vehicle deliveries in 2023 totaling 1.79 million, just below that 1.8 million target, according to FactSet. Meanwhile, Wall Street is currently expecting 473,000 deliveries in Q4.
Analysts' average 2023 EPS estimate has also fallen 7% since Q3 earnings. Wall Street is predicting 2024 earnings will now undercut 2022, with analysts expecting EPS of $3.87 — down 14% vs. the $4.50 view before Q3 earnings.
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Cybertruck And Tesla Stock
TSLA has surged about 90%, broadly outperforming the broader S&P 500 index, in 2023 as investors bet that the EV maker's growth story was intact, despite near-term growth woes. Tesla stock is building the right side of a double-bottom base giving it a 278.98 buy point, according to MarketSmith analysis.
On Monday, Jefferies analyst Philippe Houchois lowered his firm's price target on TSLA to 210, down from 250, while maintaining a hold rating on the shares. The analyst then added a few words on the Cybertruck.
"However unlikely just a few days before first deliveries, canceling Cybertruck would probably be positive for shares," Houchois wrote Monday. "With 2024 already a lost year for growth, it would help Tesla refocus on an edge that was built on simplicity, scale and speed."
This follows Morgan Stanley analyst Adam Jonas writing on Nov. 6 that Tesla must stop missing consensus EPS estimates while successfully launching new vehicles, including, but not limited to, the Cybertruck.
"The Cybertruck bar has been significantly lowered," Jonas wrote. "While we continue to view the model as relatively insignificant within the grand scope of Tesla's future portfolio, we would not underestimate the impact of launch/ramp execution on sentiment."
The Cybertruck will be the EV maker's first new passenger vehicle since the Model Y launched in early 2020.
Tesla stock ranks sixth in the 35-stock IBD automaker industry group. The S&P 500 component has a 90 Composite Rating out of a best-possible 99. Tesla stock also has a 89 Relative Strength Rating and an 88 EPS Rating.
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