Tesla Shares Tumble After Company Cuts Model S, X Production

Elon Musk and Tesla stock are facing gale force headwinds today, so to speak.

Shortly after we reported that the SpaceX "Starship Hopper" space ship had been blown over by a 50mph gust of wind - reportedly the kinda space ship will never encounter as it enters low earth orbit - and which has since been unofficially renamed to the Starship Potemkin, moments ago TSLA stock tumbled following a Bloomberg report that, confirming the bulls worst fears, demand for the Model S and X is simply not there, and as a result the company has reduced production of the two key products:

“We recently announced that we are no longer taking orders for the 75 kWh version of Model S and X in order to streamline production and provide even more differentiation with Model 3,” Tesla said in an emailed statement. “As a result of this change and because of improving efficiencies in our production lines, we have reduced Model S and X production hours accordingly”.

As Bloomberg adds, Tesla "reduced the amount of hours it’s producing Model S sedans and Model X crossovers after getting rid of the option for customers to order the vehicles equipped with entry-level batteries, according to a spokeswoman."

Chief Executive Officer Elon Musk announced earlier this month that Tesla would no longer take orders for the 75 kilowatt hour version of the Model S or Model X starting Jan. 14. At that time, there was at least a $15,000 difference between the 75D and 100D versions for the two models.

The news also comes just hours after we reported that Porsche has decided to double production of its "Tesla Killer" model, the Taycan.

We have a sinking suspicion that the two events are linked.

The news sent Tesla stock tumbling over 5%...

(Click on image to enlarge)

... to the lowest price since October.

Finally, adding insult to 50mph wind gusts, RBC this morning downgrading TSLA to Underperform, with a new price target of $245 down from $290 previously, with analyst Joseph Spak noting that "the company seems to be more tactful with messaging which is a long-term positive, but means downward pressure to growth expectations - which in our view are too high to justify current levels, let alone to add to positions."

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