Tesla China Sales Reportedly Rise Following January Price Cuts: Has Momentum Returned To Robust Q4 Levels?

Tesla Inc.’s TSLA recent price cuts in China have boosted sales but not by as much as it would have desired.

What Happened: Tesla’s electric vehicle sales nearly doubled in the week ended Feb. 20 to 10,703 units compared to the previous week, data from China Merchants Bank International showed, Reuters reported.

CMBI tracks vehicle sales based on car insurance registration.

See Also: Everything You Need To Know About Tesla Stock

The weekly numbers were the highest since the week of Jan. 9, when Tesla sold 12,654 vehicles in China, shortly after announcing price cuts.

The average daily sales rate for the year-to-date period was 1,016 vehicles, lower than the 1,317 for October and November, Reuters said. The lower daily sales rate in the first quarter relative to the fourth quarter of 2022 raises doubts over whether the discounts are luring enough buyers to take sales past fourth-quarter levels. In the fourth quarter, Tesla’s domestic sales in China totaled 121,619 units, and including exports, its wholesale China sales came in at 120,576 units.

Why It’s Important: China is Tesla’s key market, both from a demand and supply perspective. Although Tesla is now regionally diversified in terms of production, the company continues to rely on its Giga Shanghai for about half of its vehicles.

Things could change over time. On Monday, the company reported that Giga Berlin production ramped up to 4,000 Model Y vehicles per week ahead of schedule. The company targets a ramp-up to 10,000 cars a week or 500,000 vehicles per year.

Price Action: In premarket trading on Tuesday, Tesla shares were rising 1.93% to $211.64, according to Benzinga Pro data.

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