Tesla will briefly half production of its Model Y sedan in China over the final week of the year, Reuters reported Friday.
Tesla Prepping Short Model Y Production Halt In Shanghai As China Demand Fades - Report
Tesla Prepping Short Model Y Production Halt In Shanghai As China Demand Fades - Report
Tesla (TSLA) - Get Free Report will suspend China-based production of its Model Y sedan over the final week of the year, reports indicated Friday, adding further concerns over weakening demand in the world's biggest car market.
Reuters reported Friday that the Model Y output suspension will begin on December 25 and last through January 1, according to a company memo, and ultimate reduce output of the sedan by around 30% from November levels.
The move would mark the first time Tesla has voluntarily lowered output levels since the factory was opened in 2018, although Covid restrictions and scheduled maintenance clipped production earlier this year.
The report follows shortly on the heels of a move by Tesla to offer further discounts to China-based buyers of its Model 3 and Model Y sedans, provided the purchase is completed by the end of the year, adding to price cuts unveiled in October.
The price cuts certainly provided a boost for November sales, however, with overall shipments rising more than 90% from last year to a record 100,291 vehicles, according to data revealed Monday by the China Passenger Car Association.
Tesla shares were marked 0.21% higher in pre-market trading to indicate an opening bell price of $173.80 each, a move that would still leave the stock down more than 56.6% for the year.
Short interest in Tesla shares remains elevated, as well, with bets around the group pegged at around $12 billion, according to recent data from S3 Partners, a figure that represents around 2.65% of the group's outstanding shares.
China's recent loosening of Covid restrictions is expected to boost growth in 2023, but the damage from its draconian policies has left a lasting scar on the world's second-largest economy, with data today indicating a second consecutive contraction in factory gate prices over the month of November, following on from the biggest year-on-year decline in exports in nearly three years.
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