Tesla insurance registrations in China nearly doubled last week after two second consecutive declines, with local China-made vehicle deliveries in February on track to increase compared to a year earlier.
Tesla had 10,705 insurance registrations for the week of Feb. 20-26, up 80% from the 5,913 in the prior. The global EV giant had 7,946 Model Y registrations and 2,759 Model 3 registrations.
The jump in insurance registrations follows two consecutive drops, but also came in below estimates. The latest figures don't answer whether Tesla demand in China is waning after an initial pop following big price cuts on Jan. 6. Those price cuts followed substantial price reductions in late October.
Tesla Shanghai exports to Europe and elsewhere may be limiting EVs for local delivery, though that constraint is likely ending. However, the company has had 32,224 insurance registrations in China so far in February. That total puts Tesla on pace for more deliveries than the 23,200 in February 2022. It's also more than the 26,843 vehicles delivered to local customers in Jan. 2023.
In February 2022, the global EV giant delivered 56,515 China-made vehicles. Those numbers comprised of 33,315 vehicles exported and 23,200 delivered to local customers in China. In February 2021, Tesla sold 18,318 vehicles in China.
The company's Shanghai plant capacity is now much higher in than in 2022, while the EV giant also started 2023 with significant inventory, even with a year-end Shanghai shutdown. China Tesla deliveries also are no longer so heavily weighted to the last month of the quarter.
Tesla China EV Rivals
Tesla competitor BYD had 39,473 total insurance registrations, up 7% compared to the week prior. But that's still well below the weekly sale pace that the EV and battery giant was setting in late 2022. BYD dealers have cut prices recently on many models, joining China's big price war.
Denza, the luxury EV manufacturer 90%-0wned by BYD and 10% by Mercedes-Benz, had 1,947 insurance registrations last week, up 5% from the previous week.
China-EV startups Li Auto registrations climbed 27% to 5,387, Nio registrations advanced 6% to 3,357 and XPeng grew 15% to 1,685.
Li Auto, Nio and XPeng will release February deliveries early Wednesday, with Nio also reporting Q4 earnings. Li Auto reported Q4 results on Monday. BYD will likely release February sales by Friday.
Futures Fall After Market Closes Poorly; Tesla Sets Up For Investor Day
Tesla Stock
Tesla stock gained 1.5% early before dropping 0.9% to 205.74 Tuesday during regular market trade. On Monday, TSLA shares surged 5.5% to 207.63. Last week, Tesla stock fell 5.5%, but shares have still more than doubled since the Jan. 6 low of 101.81.
Li Auto stock rose a fraction early Tuesday, with XPeng up modestly. Nio stock edged lower. BYD stock was not yet active. All are below their 200-day moving averages.
Tesla Investor Day
All eyes are on Tesla's investor day on Wednesday. Tesla stock appears to be forming a handle of some sort, with a 217.75 buy point. But investors also would want to see TSLA stock break above the 200-day moving average, currently just above 221.
On Wednesday, CEO Elon Musk is expected to announced his "Master Plan 3." Analyst expectations are the EV company will introduce its lower-cost third generation vehicle platform as well.
What's The Demand In China
In mid-February, Bloomberg reported Tesla would pause some output at its Shanghai plant starting Feb. 19 to retool production lines for a Model 3 upgrade coming later this year. This would be the third shutdown of the Shanghai plant in less than two months.
Tesla reportedly upgraded production lines in stages over the past two months, with deliveries of the new Model 3 sedan expected to begin later this year, according to Bloomberg. The global EV giant has not confirmed reports of a new Model 3.
Tesla planned to produce an average of nearly 20,000 vehicles a week at its Shanghai plant in February and March, according to Reuters, citing sources, but it's not clear that happened. Last year, Tesla Shanghai upgrades affected output in July and early August.
Tesla sold 66,051 China-made vehicles in January, a 10.4% increase compared to a year ago and up 18.4% vs. December. Of those deliveries, the global EV giant exported 39,208 vehicles from its Shanghai plant. Tesla tends to focus on exports from Shanghai in the first part of the year.
TSLA shares rank fourth in IBD's Auto Manufacturers industry group. Tesla stock has a 73 Composite Rating out of 99. The stock also has a 28 Relative Strength Rating. The EPS Rating is 99.
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