Tesla stock drops 5% on report saying China orders halved in May
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- Tesla shares extended early losses to as much as 5% on Thursday after reports of a China sales drop.
- The Information reported Tesla sales in China fell to roughly 9,800 in May, down from more than 18,000 in April.
- China sales accounted for 29% of Tesla's global sales in the first quarter.
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Tesla shares extended earlier losses to as much as 5% on Thursday after a report from The Information said China orders halved in May.
Citing a person with knowledge of internal data, The Information said Tesla's monthly net orders in China dropped to roughly 9,800 in May, down from more than 18,000 in April. The figures reveal a continued slide in demand for Tesla's electric vehicles in China after March saw 21,000 net orders.
China accounted for 41% of the world's EV sales in 2020, according to research firm Canalys, and Tesla raked in 29% of its global sales in the first quarter from the country.
Tesla has faced persistent public-relations issues in China that are hampering its progress in the nation and even resulting in the company halting its Shanghai factory expansion.
The trying situation started when Chinese regulators summoned Tesla execs for a meeting about quality issues like unintended acceleration and battery fires in February. Then, in March, Chinese officials restricted the use of Teslas among government personnel citing security concerns over cameras installed in the vehicles.
A woman's protest at the Shanghai auto show added to PR issues for the firm. The protestor stood on top of a Tesla vehicle wearing a t-shirt with the phrases "Invisible Killer" and "The Brakes Don't Work," according to The Wall Street Journal.
Despite recent issues with sales in China, Tesla stock is still up over 225% in the past year.
Shares of the EV maker traded down 4.40% as of 3:06 p.m. ET on Thursday after news of the falling China sales broke.
Markets Insider