Tesla Inc (NASDAQ: TSLA) is trading down on Monday after Bloomberg said the electric vehicles manufacturer planned on cutting production of its small SUV – the Model Y.
Tesla says it’s ‘false news’
At its Shanghai factory, the report suggests, the EV giant will lower production of the Model Y by more than 20% (month-on-month) in December due to softening demand.
So, there’s still at least some confusion since we don’t know if the company meant it’s not lowering production in the first place or is it just that the cut is not related to weakening demand.
Last week, Tesla had to recall as many as 435,000 of its electric vehicles in China to fix a rear light issue. Versus the start of 2022, Tesla shares are down nearly 60% at writing.
Tesla delivered record China-built EVs
On the flip side, the China Passenger Car Association says Tesla Inc delivered a record 100,291 China-built cars in November – up 40% sequentially and about 90% versus a year-ago.
Put together with Tesla denying plans of lowering production, it’s an opportunity to buy Tesla shares on the pullback, said famed investor Jim Cramer this morning on CNBC’s “Squawk on the Street”:
Look, that number is pre the reopening. I’d like to buy Tesla on that. I think that’s a great opportunity to buy Tesla because the opening will do well.
His constructive view matches Wall Street that also rates Tesla Inc at “overweight”. The average price target on “TSLA” is $288 a share – more than a 50% upside from here.
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