Tesla China registrations decrease, focus shifts to Full Self-Driving as Cathie Wood continues to invest

Tesla China registrations decrease, focus shifts to Full Self-Driving as Cathie Wood continues to invest

You’re here (TSLA) auto insurance registrations in China are down compared to last quarter and the same period in 2023, as first-quarter vehicle deliveries likely appear well below Wall Street consensus. However, Tesla stock rose Tuesday as the electric vehicle giant announced it was offering one-month free trials for its full self-driving service.




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Tesla insurance registrations in China totaled 13,700 last week, up 11.4% from the previous week but down about 14% from a year ago, according to the data reported by CnEVPost.

One week into the first quarter, Tesla insurance registrations in China totaled 116,400, down more than 5% from the same period in 2023. The latest data from China is further evidence that Tesla appears to be heading towards a delivery failure in the first quarter.

The Wall Street consensus still calls for first-quarter deliveries of 474,000 units, according to FactSet. However, this figure is expected to decline sharply after many analysts downgraded their forecasts in recent days.

Forecasts appear to be more around Tesla’s Q1 2023 figure of 422,875. The global electric vehicle giant hit a record 484,507 deliveries in the fourth quarter of 2023. The previous record for quarterly deliveries was in the second quarter with 466 140.

Tesla announces its deliveries for the first quarter of 2024 in early April.

Meanwhile, Bloomberg reported on Friday that Tesla was reducing production at its Chinese factory from 6.5 days to five days a week. Production cuts began earlier in March and could continue into April, according to Bloomberg.

The move comes amid slowing electric vehicle growth in China and the fact that Tesla’s Shanghai facilities are already not producing at full capacity. Tesla watchers have repeatedly said in recent weeks that global inventories appear high.

Adam Jonas, an analyst at Morgan Stanley, wrote Monday that if Bloomberg’s report was accurate, “it would be another sign of oversupply in the world’s largest electric vehicle market.”

The analyst added that Tesla could “witness consumer fatigue with price cuts (buyers’ strike) and could test profitability levels that the company may not find acceptable.”

“However, we prefer production cuts over price cuts to help balance supply and demand,” Jonas wrote.

Fully autonomous driving excites the market

Over the weekend, Tesla began rolling out its latest Full Self-Driving (FSD) update to Tesla customers.

Then on Monday, several emails from CEO Elon Musk were leaked on social media platforms, showing that he was making it mandatory in North America to install and activate the latest version of FSD on vehicles and that he gave customers a “short test before handing over”. the car.”

“I know this will slow down the delivery process, but it is nevertheless a strict requirement,” Musk wrote to Tesla employees.

Tesla then announced Monday evening that it would offer a free one-month trial of FSD in the United States with the purchase of a new vehicle. The free trial is available for new Model Y, Model S and Model X orders.

“All U.S. cars capable of running FSD will be enabled for a month-long trial this week,” Musk said on X, formerly Twitter, Monday evening.

Tesla Stock Performance

TSLA shares jumped 4.2% to 179.77 in market action Tuesday. On Monday, Tesla stock gained more than 1% to 172.63. Meanwhile, Cathie Wood and her Ark Invest funds invested in Tesla stock on Monday, purchasing 163,421 shares, according to the company’s daily trading disclosures.

Wood’s Tesla transactions were made through the ARK Innovation ETF (ARKK) And Next Generation Internet ARK (ARKW). Cathie Wood spent $28.21 million on TSLA on Monday, based on Tesla’s closing price of 172.63. Ark and Cathie Wood recently bought Tesla as it hovers around lower.

Tesla shares gained 4.4% over the week, recording their first weekly gain in three weeks. Two weeks ago, Tesla stock fell 6.7% to 163.57, hitting new 2024 lows and levels not seen since May 2023. TSLA is down more than 15% in March and THE the biggest loser in the S&P 500 index so far in 2024.

With 2023 in the rearview mirror, analyst consensus now estimates that Tesla’s 2024 earnings are below the 2023 level. This signals another year of declining earnings for this growth stock. Wall Street expects Tesla earnings per share to be just $2.95 in 2024, according to FactSet. That would represent a drop of more than 5% from last year’s $3.12.

The electric vehicle giant ranks eighth in the 35-member IBD. Automotive Manufacturers Industry Group. The stock has a 33 Composite score on a best possible 99. Tesla stock also has an 11 Relative Strength Rating and a 68 EPS rating.

Please follow Kit Norton on X, formerly known as Twitter, @KitNorton for more coverage.

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