4 October 2022 | Other

Tesla falls on supply and production gap

On Monday, shares of Tesla Inc fell 8.6%. Such a fall was caused by the fact that the company faced logistical problems in the delivery of cars, accordingly, their number did not match Wall Street forecasts. In turn, slowing economic growth caused doubts about demand.

Despite a record number of deliveries during the quarter, Tesla fell short of market expectations as the gap between production and delivery was particularly large as the company struggled to produce enough vehicles at peak times at a reasonable price.

Along with the supply gap, investors are also worried about demand amid rising prices for the company's vehicles, rising borrowing costs and meager global economic growth prospects.

Ryan Brinkman, an analyst at JP Morgan, said that while the electric-car maker continues to insist that supply constraints are limiting its supply, there remains a wide potential for demand to fall.

Still, analysts expect Tesla's production margins to remain strong in the fourth quarter because of its pricing power and its ability to use China as an export hub for many countries.

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