Tesla Model 3 boldly defies sales slump in world’s largest electric car market

Joey Klender

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Posted on December 20, 2019

Tesla is reportedly coming off of one of its most successful months in November 2019 as Chinese registrations of the company’s electric vehicles skyrocketed 14x compared to their numbers in October. The news of the dramatic spike in new-car registrations gives Tesla plenty of momentum as the first deliveries of its Gigafactory 3-produced Model 3 sedan are set to begin soon.

In November, Tesla registered a total of 5,597 cars in China, the highest monthly registrations it recorded since June. It should be noted that the company reportedly sold less than 400 cars in the country in November 2018, according to China Automotive Information Net. New vehicle registrations may not necessarily reflect Tesla’s exact sales numbers, but they do provide a valuable metric in tracking the company’s performance in the local electric car market.

Auto analyst for Bloomberg Intelligence Steve Man believed tariffs on U.S. manufactured vehicles set to take effect in December may have helped spike sales for Tesla. These tariffs are no longer set to take effect because the United States and China agreed to the initial phases of a trade agreement in mid-December.

(Credit: Bloomberg Intelligence)

Despite a slowing Chinese electric car market, Tesla continues to thrive. The next step for the company and its CEO Elon Musk is to begin deliveries of Model 3 vehicles that have been manufactured at its Shanghai production plant. The Made-in-China Model 3 will cost around $50,000, though government subsidies could knock about $3,500 off the price of the vehicle, according to the Chinese Ministry of Industry and Information Technology.

Demand for the Model 3 in China is recognizably high according to Musk. However, he sees the vehicle’s price will need to come down slightly for the company to be successful there. “It’s important to appreciate, the demand for Model 3 is insanely high. The inhibitor is affordability. It’s just that people literally don’t have the money to buy the car. It’s got nothing to do with desire. They just don’t have enough money in the bank account. If the car can – if we made it more affordable, the demand is extraordinary,” Musk said back in May 2019.

Tesla’s potential in China is significant because of the overwhelming presence of battery-powered cars in the country. China is responsible for around 45% of the world’s electric car market, as per data from the International Energy Agency. This accounts for about 2.3 million battery-powered cars in the country in 2018. China’s growth in the electric car market is evident as well. In comparison, the second-largest global fleet of electric cars in the world last year was Europe, which accounted for 24% of the worldwide EV market. The United States follows with 22%.

Musk has stated he expects Gigafactory 3 to produce around 3,000 vehicles a week and recognizes the advantages his company holds in China. “If you’re in the automotive industry you understand how significant this is, but maybe it’s not as obvious to everyone. Tesla has the first wholly-owned manufacturing facility in China of any automotive company. So, this is profound. And we’re very appreciative of the Chinese government allowing us to do this,” Musk said.

Tesla Model 3 boldly defies sales slump in world’s largest electric car market

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Tesla (TSLA) closes in on $420 as shorts choke on $2 billion loss

Simon Alvarez

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Posted on December 19, 2019

Tesla stock (NASDAQ:TSLA) has set new records once more, with shares breaking the $400 barrier on Thursday’s opening bell. Together with a new record market cap of $72 billion, TSLA stock’s recent displays of strength have given yet another massive blow to short-sellers. 

That’s a blow worth over $2 billion and a step towards the proverbial $420 per share mark that CEO Elon Musk quoted during a brief attempt at taking Tesla private last year. 

S3 Partners Managing Director of Predictive Analytics Ihor Dusaniwsky noted in a recent update that as of Thursday, TSLA shorts have swallowed $2.16 billion in 2019 mark-to-market losses. As per the executive’s previous statement, levels beyond $390 per share could signify the start of short covering for TSLA stock. This could result in even more gains for the electric car maker. 

Tesla remains a heavily shorted company, but short interest in the electric car maker has been at a decline. This means that while there are still a significant number of short-sellers pushing for Tesla’s failure, their numbers are already decreasing, and more may be on the way out as the company continues its rise. Even on Wednesday, for example, Dusaniwsky remarked that there was already a slight squeeze happening. 

Sentiments appear to be improving in Tesla’s favor, at least for the near future. As the company closes in on the end of the year, reports suggest that Model 3 sales are as healthy as ever. With Tesla’s all-electric mass-market sedan saturating the auto industry’s biggest markets, even Wall Street analysts who have expressed reservations about the vehicle in the past are starting to become more optimistic. 

Morgan Stanley’s Adam Jonas, who has adopted both bold and cautious stances in the electric car maker in the past, recently came out with a note. Jonas included a brief anecdote in his note, highlighting the actual impact of the Tesla Model 3 and its inherent disruption, even in places that one may not expect. 

“Last night, I was walking through the streets of Madrid’s Barrio de Salamanca…passed a red Tesla Model 3 dual motor parked on side of the road, sandwiched between two compact diesels. Here I am in the middle of the Spanish capital looking at a $60k product that is manufactured in California. Not just ‘Made in the US.’ It’s made in Silicon Valley. With Silicon Valley input costs, regulations, taxes, and workers paying Silicon Valley rents,” Jonas wrote. 

If Dusaniwsky’s predictions prove accurate, an actual “Short Burn of the Century” might actually happen soon. In the meantime, Tesla seems poised to end 2019, a year that saw over two-year-lows, the strongest it has been in its history. 

As of writing, Tesla stock is trading +3.00% at $404.96 per share. 

Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.

Tesla (TSLA) closes in on $420 as shorts choke on $2 billion loss

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Tesla’s active safety features save apparent jaywalker from potential accident

Joey Klender

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Posted on December 18, 2019

Tesla’s active safety features helped save a woman’s life in Beijing, after the vehicle alerted the driver and abruptly came to a halt when approaching a jaywalker.

@Tesla__Mania recently shared a clip showing a Tesla traveling in a left, before encountering a woman in her attempts to cross a three-lane highway. 

In any other circumstance, these conditions could have easily gone south for the pedestrian. Fortunately for her, the Tesla appears to have detected her presence as soon as she stepped into the vehicle’s lane. The all-electric vehicle was still traveling at city driving speeds before the warning chimes went off and vehicle’s Automatic Emergency Braking seemingly kicked in.

Unfortunately, China has a reputation for being the country with the highest amount of road accident fatalities in the world. According to a 2016 article from the South China Morning Post, a World Health Organization study found that 700 people are killed a day in traffic-related incidents in the country. This indicates a death-rate of 260,000 people a year from traffic accidents, and 60 percent of these fatalities are pedestrians, bicyclists, or motorcyclists. If the recent incident in Beijing is any indication, it appears that Tesla’s safety features have just prevented a person from being part of this year’s grim statistic.

Tesla rolled out Automatic Emergency Braking way back in 2015 with the version 6.2 Software Update for the Model S, and the feature has since received innumerable refinements through the company’s over-the-air updates. AEB utilizes the forward-looking cameras and radar sensor to determine the distance of an object in front, applying brakes as necessary to avoid or reduce the damage from a collision. Accounts from Tesla owners suggest that objects in the vehicle’s periphery may trigger AEB in some instances as well.

Automatic Emergency Braking has made headlines prior to this incident on numerous occasions. Not only has the feature saved numerous Tesla owners from accidents, but it also contributed to the Model 3 earning a “Superior” rating in Front Crash Prevention from the IIHS and the vehicle’s stellar ratings with the Euro NCAP.

It is widely known that Tesla vehicles are some of the safest cars someone could purchase. Despite numerous awards won by its fleet of vehicles, Tesla is never one to rest on its laurels, striving towards safety and innovation with the same intensity as ever. This recent incident from Beijing shows that Tesla’s ever-ongoing push towards safety is actually making a difference, and at some point, even saving lives.

Tesla’s active safety features saves apparent jaywalker from potential accident

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