Tesla shares tumbled on Wednesday morning (with everything else), in part as a result of the latest data out of China which showed a stark drop in sales. Last month, the company's growth "slowed precipitously" after weeks of controversy that started with a protest at the Shanghai Auto Show calling into question the quality of Tesla's brakes. What followed was weeks of negative press in China, where state media decried the company as "arrogant" and urged it to focus on the quality of its vehicles.
Data from April shows that just 11,949 Tesla vehicles were registered in the country, down sharply from the 34,714 registrations in March, according to Bloomberg.
In addition to that data from China Automotive Information Net, additional data from China’s Passenger Car Association out last week showed that the company sold 25,845 Chinese-made vehicles in April, down from 35,478 in March. Separately, 14,174 EVs were exported, due to demand from Europe, the report notes.
Recall, before making somewhat of an about face on their recent attitude on Tesla (after Musk's rebuke of bitcoin), Chinese state media had been anything but friendly to the U.S. auto manufacturer.
We have been documenting the ongoing spat between Tesla and the Chinese Communist Party over the last month, apparently (at least publicly) catalyzed by a protestor at the Shanghai Auto Show alleging faulty breaks on Tesla vehicles. This led to intense shaming by Chinese media, who called Tesla's handling of the situation a "blunder" and suggested it could "inflict serious damage" on Tesla with the Chinese market.
The relationship between the automaker and the country was likely not helped along on Monday this week, when we posted a story detailing how a Tesla hit two Chinese policemen, killing one of them.
Broader indices were also plunging on Wednesday morning, with crypto leading the carnage, as we pointed out moments ago in our pre-market recap.
Global stocks and US index futures fell for the third straight session, led by the Nasdaq 100, bonds and commodities dropped ahead of today's release of the April Fed minutes after the ECB warned the euro-area faces elevated risks to financial stability as it emerges from the pandemic with high debt burdens and “remarkable exuberance” coupled with resurgent worries over inflation and coronavirus flareups.
The yield on 10-year Treasury notes touched a one-week high of 1.67%, driving down additional names like Apple, Microsoft and Facebook.