By
Svetlana Soroka
April 18th, 2024
Tesla is looking for alternative markets to cushion losses experienced in the sales in California in April and May. Despite this drop, TSLA stock managed to hit a new record high of $1,000 in June
Tesla Inc (NASDAQ: TSLA), one of the most promising companies today is seeking an alternative market to boost sales as the sales in the company’s hometown plunges. While there was a halt in the general supply of the company’s electric car products during the pandemic, Tesla Registrations, a major index for sales fell in April and May in California, the company’s stronghold forcing the company to look to markets in China.
Tesla (TSLA) stock opened at $1,002.00 in the pre-market today representing a 1.03% increase to the closing price of $991.79 (+0.98%) yesterday. This sustained performance can be attributed to investors’ confidence in TSLA stock based on its precedents.
Tesla Market Diversification Plan and Interests in China
There is a huge market for electric vehicles in China and Tesla through its Shanghai factory began the production and sales of Chinese built electric cars. The company’s model for attracting Chinese customers includes the earlier announced price slash strategy.
Dan Ives, an analyst at Wedbush Securities, stated:
“Right now the key to Tesla’s stock remains the staggering China growth rebound which is paramount to the company’s overall goals to hit one million delivery vehicles annually in a few years.”
“We continue to believe EV demand in China is starting to accelerate with Tesla competing with a number of domestic and international competitors for market share with Giga 3 remaining the linchpin of success which remains the prize that Musk and Tesla are laser focused on capturing,” added he.
With this strategy in place to subsume the Chinese market, the 14% decline recorded in April plus the 70% drop in May will have no damning effect on the company’s performance for the rest of the quarters in the year.
Probable Regional Expansion for Tesla
The majority of Tesla products are concentrated in the United States, Europe, and Asia with good power to charge up the cars. The average cost of Tesla’s electric cars is about $41,000, a major question borders around the possibility of expanding the products into regions like Africa. While Africa and some parts of Asia have the population that can drive the market, limitations including purchasing power of the masses may prevent these environmentally friendly cars from permeating the African continent.
Tesla can step ahead of the game by proliferating its factories in key African regions to build cars to suit the African economy and landscape just as it’s doing for China. This way, the company’s future growth can be sustained while making the world more environmentally sustainable.
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