Tough China competition hits Tesla sales
Tesla reported an 8.5 percent drop in first-quarter auto deliveries, missing estimates from leading analysts and weighing on shares. Elon Musk's auto giant reported 386,810 deliveries over the period, partly reflecting weak sales in China, where it faces heavy competition from local electric vehicle (EV) makers. The automaker's production slipped about 1.7 percent to 433,371. Analysts have been bracing for a tough first quarter for the high-flying Tesla, which has reportedly cut production in China the face of the rise of BYD and other Chinese automakers. Tesla was also hit in the quarter at its lone European factory in Germany, which was targeted in a suspected arson attack on nearby power lines in early March, denting production. At the same time, an increase in EVs in other markets including the United States has led Tesla to enact price cuts, dimming the company's profit outlook. Still, the latest figures from Tesla disappointed market watchers. "While we were anticipating a bad 1Q, this was an unmitigated disaster," said Wedbush analyst Dan Ives. "We view this as a seminal moment in the Tesla story for Musk to either turn this around and reverse the black eye 1Q performance. Otherwise, some darker days could clearly be ahead that could disrupt the long-term Tesla narrative." Shares closed almost five percent lower. (AFP)