Tesla, the American electric vehicle manufacturer, continues to see a decline in its stock price as it struggles with weak performance in the global market.
On the 7th (local time), Tesla's stock closed at $361.62 on the New York Stock Exchange, down 3.39% from the previous day. The stock started the session at $370.19 but gradually extended its losses throughout the day.
The primary factor behind Tesla's stock decline is weak sales performance in the Chinese market.
According to the China Passenger Car Association (CPCA), Tesla sold 63,238 vehicles in China in January, marking an 11.5% decrease compared to the same period last year.
In contrast, China's largest EV manufacturer, BYD, sold 296,446 electric and plug-in hybrid vehicles during the same period, representing a 47.5% year-over-year increase.
Additionally, emerging Chinese EV companies such as Xiaomi are rapidly expanding their market share, posing a threat to Tesla.
Although Tesla has been offering discounts and benefits such as interest-free loans for up to five years on Model 3 and Model Y purchases, its market share in China continues to decline.
Tesla has also experienced a sharp drop in sales across Europe. In Germany, its January sales plummeted by 59.5% compared to the same period last year. Similar declines were recorded in France (-63.4%), Sweden (-44.3%), and Norway (-37.9%), highlighting Tesla’s ongoing struggles in key European markets.
Since February 4, when Tesla's stock stood at $392.21, the price has steadily declined, recording a 10.6% drop this week alone. Bloomberg reported that Tesla’s stock saw its largest weekly decline since the U.S. presidential election on November 5 last year.
Tesla's stock had reached a high of $479.86 on December 17 last year, but has since fallen approximately 25% from its peak.
So far this year, Tesla's stock has declined by 4.7%, underperforming the S&P 500 index, which has risen by 2.7% over the same period.
Mark Newton, Head of Technical Strategy at market research firm Fundstrat, stated in a memo to investors that Tesla could hit bottom within the next two to three weeks and experience a sharp rebound. However, he also warned that the current price pattern and trading volume suggest that the short-term downtrend is likely to persist.
Meanwhile, Wall Street analysts have mixed opinions on Tesla’s outlook.
While some analysts maintain a "buy" recommendation, many others have adopted a cautious stance, issuing "hold" or "sell" ratings.
Mark Newton reiterated his view that Tesla may bottom out in the coming weeks and rebound, but also cautioned that the short-term downtrend remains intact.
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Tesla Stock Falls Amid Global Sales Slump, Struggles in China and Europe
Tesla, the American electric vehicle manufacturer, continues to see a decline in its stock price as it struggles with weak performance in the global market.On
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