Tesla vehicle insurance registrations in China last week jumped sequentially and increased vs. a year earlier, as China EV registrations broadly picked up steam at the end of May. TSLA shares angled lower Tuesday.
Tesla insurance registrations in China totaled 15,200 for the week of May 27-June 2, up 16% from 13,100 the previous week, according to data reported by CnEVPost Tuesday. Vehicle registrations in China tend to pick up toward the end of the month, according to local reports.
Tesla also has stepped up incentives in China in recent weeks, including 0% interest offers.
Through nine weeks in Q2, Tesla China insurance registrations are up around 18% compared to the seasonally slow first quarter and down 4% vs. the same time frame in 2023.
Meanwhile, Tesla China deliveries in May came in at 72,573, down 6.6% vs. a year earlier and up 16.7% vs. April, according to figures released by the China Passenger Car Association (CPCA) on Tuesday. The deliveries include both local sales in China and exports.
Through the end of May in 2024, Tesla China deliveries are down 7.1% compared to the first five months in 2023.
Most of Tesla's China rivals, including BYD, Nio, Li Auto and Zeekr, have reported solid year-over-year gains so far in 2024.
Meanwhile, Reuters reported in late May that Tesla planned to reduce Model Y production in China by around 20% between March and June.
Q2 Delivery Outlook
Analysts predict global Q2 Tesla deliveries will total 445,000 vehicles, according to analyst consensus. That would be down 4.5% compared to last year's 466,140 deliveries. Tesla hit a record 484,507 deliveries in Q4 2023.
Tesla reported in early April that global first-quarter deliveries totaled 386,810 while it produced 433,371 vehicles. The deliveries included a combined 369,783 Model 3 and Model Y units along with 17,027 "other" vehicles.
Tesla's 386,810 deliveries tally in Q1 undercut even the lowest estimates and marks the lowest quarterly deliveries since 344,000 in Q2 2022. Since then, analysts have been revising lower delivery estimates.
Tesla ended the first quarter with a global vehicle inventory of 28 days, up 87% compared to Q1 2023. Auto gross profit margins, excluding regulatory credits, came in at 16.4%, above expectations of 15.9%.
Chief Executive Elon Musk said on the first-quarter earnings call he expects 2024 vehicle deliveries to grow compared to 2023. The EV giant saw deliveries in 2023 hit a record 1.81 million. However, EV demand appears to be slowing this year.
"We think Q2 will be a lot better," Musk added on the earnings call.
Tesla Stock Performance
TSLA shares fell 0.9% to 174.77 during market trade on Tuesday. Tesla stock dropped 1% to 176.29 on Monday. TSLA shares dropped 2.8% in May and have sunk around 30% so far this year.
News reports circulated early Friday that Tesla reduced vehicle prices in Denmark.
Meanwhile, Reuters reported last week that Tesla is preparing to register Full Self-Driving, or FSD, with China regulators.
After registration, Tesla can have employees test FSD on public roads in China. The company can then offer it as an upgrade to customers in the coming months, according to Reuters.
Tesla has rallied since reporting first-quarter earnings and revenue on April 23, finding support at its 50-day moving average, according to MarketSurge analysis. On April 22, Tesla stock hit a 52-week low of 138.80.
Tesla holds its annual shareholder meeting on June 13. Shareholders are voting in the run-up the meeting on whether to reapprove Musk's 2018 $56 billion compensation package.
The EV giant will report second-quarter earnings in mid-July.
Tesla stock ranks seventh in the 35-member IBD Auto Manufacturers industry group. The stock has a weak 40 Composite Rating out of a best-possible 99. Shares have a 16 Relative Strength Rating and a 62 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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