Tesla, Inc.‘s (NASDAQ:TSLA) sales have stuttered in all geographies, and China, one of its key markets, hasn’t been an exception. New vehicle insurance registration data for the recent reporting week showed there is no respite yet despite the ramp-up and sales of the Model 3 refresh.
What Happened: Insurance registrations for Tesla vehicles stood at 13,000 units in the week of November 6-12 were at 12,700 units compared to 14,000 units in the previous week, CnEVPost reported. Insurance registrations so far in November totaled 22,900 units.
Future Fund’s Gary Black took to X, formerly Twitter, to note that quarter-to-date insured registrations were 7% below the same period in the third quarter. He said the numbers for the week of November 12 included 5,000 units of the Model 3 refresh.
$TSLA China reported a modest 13K insured registrations for the week of Nov 6-12, down from 14K last week, which included 5K M-3 Highlands. TSLA China 4Q remains -7% behind 3Q.
Source: @piloly pic.twitter.com/K7uj54YHyY
— Gary Black (@garyblack00) November 14, 2023
Why It’s Important: Tesla began deliveries of its Model 3 refresh in China only in late October. So, Tesla investors took the sharp decline in weekly insurance registrations in October in their stride. Following a string of price cuts in China this year, Tesla recently began adjusting EV prices in the country upwardly.
In late October, Tesla raised the price of its Model Y’s high-end, dual-motor, all-wheel-drive performance variant to 363,900 yuan ($49,738), up from the previous pricing of 349,900 yuan ($47,825). In dollar terms, the hike amounted to $1,913.
The company followed it up with modest price increases for the Model Y and 3 Long Range variants last week. The former became 2,500 yuan ($344 dearer), and the latter saw a price increase of 1,500 yuan ($206). The two trims are now priced at 302,400 yuan and 297,400 yuan, respectively.
Late Monday, the company raised prices in China yet again. This time, the company adjusted the price of the rear-wheel drive Model Y by 2,500 yuan ($344) to 266,400 yuan. The company also nudged up the price of the RWD version of the Model 3 by 1,500 yuan ($206) to 261,400 yuan.
Black has previously commented that price hikes send a “positive signal.” Reversing the price cuts would allay investor fears concerning a further erosion in the company’s contracting core auto gross margin.
The global economic outlook remains uncertain, and higher prices may ward off the cautious consumer. Black pins his hopes on an affordable Model 2 vehicle, which can disrupt the EV industry.
Photo via Shutterstock
In premarket trading on Tuesday, Tesla rose 1.67% to $227.45, according to Zenger News Pro data.
Produced in association with Benzinga
“What’s the latest with Florida Man?”
Get news, handpicked just for you, in your box.