To the shares of Tesla investors keep a wide berth even after Christmas. Reports of production cuts in China weighed on the shares of the electric car manufacturer on Tuesday. The Tesla will cut production at the Shanghai plant from January, reported Reuters
exclusive. This is reviving concerns about weaker demand. According to Reuters, Tesla will halt electric vehicle production Jan. 20-31 for an extended lull for the Chinese New Year. Tesla is thus continuing the production cut that began in December.
In the current year 2022, the price loss adds up to almost 70 percent. After initial losses, the paper made up some ground on the New York Stock Exchange on Wednesday and climbed above the $110 mark by 5 p.m. (CET). In March, the stock was still well over $360.
Market cap drops to $345 billion
The market capitalization, which was just over 1.2 trillion dollars in November 2021, has now fallen to almost 345 billion dollars and is thus lower than, for example, the stock market value of the retailer Walmart or the bank JPMorgan. The electric car maker’s stock fell to 16th from the S&P 500’s top 10 list of most valuable US companies.
The price drop of the former darling on the stock exchange is not only with the general one Decline in technology stocks on the Nasdaq to explain this year. Tech heavyweights like Amazon and Nvidia have also crashed since the beginning of the year, but not to the same extent as Tesla.
Three factors in particular weigh on Tesla
At Tesla, there are three main factors: First, the high valuation, second, Tesla Twitter-Trauma and thirdly, the realization that the one-time tech messiah Elon Musk (51) more and more unpredictable and thus from a savior to a risk for the company .
Investors have long criticized Musk’s new role as owner and CEO of the news service Twitter distracted for months and neglect the carmaker. In addition, the extroverted manager repeatedly had to sell Tesla shares to finance the deal, which put an additional burden on the price.