Tesla's Car Registrations Slumped In China In April

Data indicates Tesla Inc.’s TSLA new car registrations have declined massively on mainland China in April.

What happened

Tesla’s new car registrations, which include imported vehicles, fell to 4,633 units in April from 12,709 units in March, a 64% decline. Sales fall in the first month of each quarter for Tesla and are lower than the two following months, reported Reuters. 

Tesla’s Shanghai Gigafactory manufactured Model 3 sold 3,635 units in April. Over 10,000 such units were produced in the same month in the automaker's Chinese factory.

Why It Matters

According to LMC Automotive, a United Kingdom-based automotive forecasting and market intelligence provider, following the easing of the pandemic caused lockdown in China, a strong rebound in sales of cars was observed in March and April. An indication that Chinese commuters are choosing to drive instead of taking public transportation. 

The decline in Tesla’s registrations and sales come at a time when the wider Chinese electric auto market witnessed a 9.8% rise in sales in April after the lockdown was lifted.

The Shangai Gigafactory was shut down for production in early May due to a “component shortage.” The factory is vital to achieving Tesla’s target of producing 500,000 units for the year 2020. 

Last month, Tesla reduced the price of its Model 3 in China to qualify for a newly announced government subsidy, only available for cars priced under $42,390.

Price Action 

Tesla shares traded 2.13% lower at $811.50 in the after-hours session on Monday. The shares had closed the regular session 1.81% higher at $813.63.