Tesla Inc (TSLA: NSD) has significantly reduced production of its popular Model Y electric vehicle at its Shanghai factory, according to a Reuters report. The exact reason for the cut remains unclear, but it comes amid signs of slowing demand for Tesla vehicles in China, the company’s second-largest market after the United States.
Double Digit Decline in Model Y Production:
The report suggests a “double-digit percentage” decrease in Model Y production since March 2024. This follows data showing a 19% decline in Tesla’s overall EV production in China during February compared to the same period in 2023.
Potential Reasons for the Production Cut:
While Tesla hasn’t officially commented on the reasons behind the production cut, several factors could be at play. A slowdown in Chinese electric vehicle demand, increased competition from domestic Chinese EV manufacturers, and ongoing COVID-19 lockdowns disrupting supply chains are all possible contributing factors.
Impact on Deliveries and Sales:
The production cuts could have a ripple effect on Tesla’s deliveries and sales in the coming months. Investors are closely watching the situation, as any significant delays in deliveries could impact Tesla’s stock price.
