Tesla shares are set for their lowest open since August of last year following a report that suggests another day of production delays at its Shanghai gigafactory.
Updated at 7:56 am EST
Tesla (TSLA) – Get Tesla Inc Report shares pared earlier pre-market gains Monday following a report that suggested the carmaker will delay the return to full capacity at its Shanghai gigafactory by at least another day.
Reuters reported Monday that Tesla won’t return to its full daily output of 2,600 vehicles in Giga 3, the group’s lynchpin Shanghai factory, until Tuesday, as it continues to struggle with staffing and parts availability linked to the city’s recent Covid lockdown. The plant had expected to be back to full-speed as early as today.
Shanghai’s improving Covid case rate, however, suggests Tesla could be up-and-running at its full weekly capacity of 16,000 units fairly soon, as new infections in China’s biggest city fell to a two-month low of 622 on Monday.
Tesla said last month that current quarter deliveries should be flat when compared to the first three months of the year, even with the multi-week shutdown of its Shanghai gigiafactory — which made around half of the group’s cars last year — amid China’s ‘zero Covid’ crackdown. The full-year delivery estimate stands at 1.47 million units.
The China Passenger Car Association (CPAC) said Tesla produced just 10,757 cars last month, selling just over 1,500 and exporting none, thanks to a 22-day closure of its Shanghai facility, which makes the Model 3 sedan and Model Y crossover, during the city’s Covid lockdown. The April tally is the lowest in 2 years and compares to a sale total of 65,814 in the month of March.
Tesla shares were marked 1.5% lower in pre-market trading to indicate an opening bell price of $653.85 each, the lowest open since August of last year.
Tesla closed at a fresh 2022 low on Friday even as CEO Elon Musk promised that the clean-energy carmaker’s fortunes were on his mind ’24/7′ as lurid headlines continue to dog the world’s richest man.
Musk said he was only spending around 5% of his time on his planned $44 billion takeover of Twitter, and noted that the bulk of his focus was on hits SpaceX and Tesla responsibilities as he looked to ease investor concerns that he’s become too distracted.
Tesla shares have fallen around 37% since Musk made his 9.1% stake in Twitter public on April 4 as investors have counted the cost of both Musk’s margin loans, his sale of around $9 billion in Tesla shares and the billionaire’s growing leadership portfolio, which includes space exploration group SpaceX, The Boring Company construction company and neurotechnology specialists Neuralink Corp.
Musk also dismissed reports, which surfaced late Thursday, that he had sexually harassed a flight attendant on a private jet in 2016 as “utterly untrue”, saying it was a “politically motivated hit piece” and adding there was “a lot more to this story.”