Tesla Sinks as Price Cuts Signal a Ceiling for Costlier Models

Share

Shares of Tesla fell by more than 6 per cent during the first trading day of 2019 after the electric-car company released its delivery figures for the end of 2018, which modestly fell short of Wall Street expectations compiled by FactSet. The company said the remaining tax credits combined with not having to fuel up at the gas pump and lowered maintenance costs "means our vehicles are even more affordable than similarly priced gasoline vehicles".

CNBC reports that Elon Musk's Tesla has yet again run into another stumbling block, once again failing to meet its expected fourth quarter delivery estimates. Deliveries also grew to 90,700 vehicles, a number that's also 8% more than Q3 2018's all-time-high.

Specifically, the company produced 63,150 Model 3 sedans.

Its shares fell by about 8% at the start of USA trading.

Kevin Spacey is stepping slowly back into public eye
Actor Kevin Spacey has asked a MA judge to skip his arraignment in a Nantucket court next week on sexual assault charges . Spacey has scarcely been spotted since past year , when allegations against him began to emerge.

The $44,000 Model 3 is seen is the most important auto for Tesla, with founder Elon Musk touting it as a more affordable vehicle.

Tesla will cut the price of its Model 3, Model X and Model S vehicles.

Deliveries of Model 3s in the period were 63,150, a 15pc rise and in line with Tesla's guidance but slightly below the 63,700 analysts had been expecting. Actual Model 3 production averaged ~4,700 vehicles per week.

Chief Executive Officer Elon Musk said, "Probably some deliveries in March, but April is more certain", after a Twitter user asked when the deliveries in China would begin.

Flights resume at Germany's Hannover Airport after man drove into secure area
Take-offs and landings were suspended while the incident was investigated, though the airport's terminals remained open. Hanover airport in Germany is on lockdown after a man drove through the gate in an attempt to get on to the runway.

As of writing, Tesla stock is trading down 7.45% at $308.00 per share.

"The price cut is what's driving the stock lower, as it openly acknowledges the sunset of subsidy dollars is a material headwind", said Craig Irwin, an analyst with Roth Capital Partners.

The $7,500 federal tax credit for electric cars was cut in half as of Tuesday. The company announced it had delivered 63,150 vehicles in the quarter, up from 1,550 in the same period previous year but below the 64,900 analysts had been expecting.

The company says it produced almost 87,000 vehicles in the fourth quarter, also eight per cent above its previous quarterly record set in the third quarter. But some bearish investors are likely interpreting it as a move to stimulate demand, said Wedbush analyst Dan Ives.

Chinese court orders retrial for Canadian in drug case
The Chinese newspaper explained that the trafficking of drugs is a felony in China, especially when the amount is enormous. She has denied the accusations, which have not been tested in court, and has been released on bail in Vancouver.

"Longer term we think the price cut is more concerning - it suggests Tesla customers are perhaps a bit more price sensitive than you might have thought", Hargreaves Lansdown analyst Nicholas Hyett write in a client note.

Share