DETROIT (AP) — Tesla shares fell more than 12% on Tuesday in the first full day of trading since the company announced shipment figures for 2022 that fell short of targets.
Shares in the electric vehicle and solar panel maker closed at $108.10, down just under 70% since the start of last year. The stock hit its lowest level since August 2020, and Tesla’s market value fell to $341 billion, down from more than $1 trillion in April, according to FactSet.
Tesla said Monday that it sold a record 1.3 million vehicles last year, but that number falls short of CEO Elon Musk’s promise to increase shipments by 50% nearly every year.
The figure for 2022 surpassed the previous record of 936,000 vehicles delivered in 2021, but fell short of the 1.4 million needed to meet the company’s 50% growth target. Sales were up 40% year-over-year and production increased 47% to 1.37 million.
The shortfall came despite strong sales growth at the end of the year, which included rare US$7,500 discounts on the Model Y and 3, the company’s best-selling models. Analysts say Tesla has also offered discounts in China, leading some to wonder if demand for the company’s vehicles is declining.
Tesla Inc., based in Austin, Texas, has also faced a growing number of cases of the novel coronavirus in China, which has hampered production at its Shanghai plant.
Analyst at Cowen and Co. Jeffrey Osborne had expected investors to focus on missing the supply target, but he saw only modest backlash “after acute weakness in the last few weeks due to Chinese production cuts and discounting.”
For stocks to receive further support, investors will need to see a solid rate of return despite falling prices, as well as demand and order trends suggesting a rebound in gains this year, Osborne wrote in a note to investors early Tuesday.
Apparently looking to bolster its stock price, Tesla announced on Monday that it would be hosting an Investor Day event at its plant near Austin on March 1st. Investors will be able to view Tesla’s production line, discuss expansion plans, and see the platform that will underpin Tesla’s next generation vehicles.
The drop in Tesla shares also cost Musk billions, robbing him of his position as the richest man in the world, according to Forbes.
Also driving the stock down was Musk’s $44 billion purchase of Twitter and his sale of Tesla shares to help fund the purchase. Musk sold another $2.58 billion worth of Tesla shares last month and has sold nearly $23 billion worth of shares in his car company since April, when he began gaining ground on Twitter.
Many investors are concerned that Musk has become too distracted as CEO of Twitter and is not paying enough attention to the electric car company. Musk has said he will step down as CEO of Twitter when he finds someone to run the social media platform.
