Tesla is struggling at the moment.
All after news of recalls. “One recall covers 5,530 vehicles, comprising 2018-2020 Model 3 and 2019-2021 Model Y cars, because fasteners that secure the front seat shoulder belt to the b-pillar may not be properly attached. The other recall covers 2,166 Model Y vehicles from 2019-2021 because fasteners that secure the left and right second-row seat belt retractors may not be properly attached,” says Reuters.
The other recall has to do with brake caliper bolts, which could come loose on the 2019-2021 Model 3s and the 2020-2021 Model Ys. The company will inspect and replace the bolts. It also doesn’t help that China sales declined by nearly half in May 2021.
In fact, according to The Information, “Tesla vehicle orders in China fell by nearly half in May compared to April, according to internal data, as the electric car pioneer grappled with public outcry and government criticism over its handling of consumer complaints. Taken together, the developments put in doubt Tesla’s vaunted position and success in the world’s biggest electric vehicle market.”
At the moment, investors seem to be shrugging off the bad news.
However, that may be a mistake, seeing that the company expected for China to make up 40% of its global sales by 2022. In addition, TSLA rivals are all showing big signs of life.
NIO, for example, nearly doubled its sales in May 2021. “NIO delivered 6,711 vehicles in May 2021, representing a solid 95.3% year-over-year growth. The company maintains and reiterates the delivery guidance of 21,000 to 22,000 vehicles in the second quarter of 2021,” says NIO.
Even the XPEV stock is soaring. All after strong delivery numbers. In May, the company delivered 5,686 vehicles, which was 500 vehicles higher than the 5,147 delivered in April. Helping, Citi analyst Jeff Chung just raided his price target to $50.30 with a buy rating. In addition, “Nomura analyst Martin Heung initiated coverage of XPeng with a Buy rating and $47 price target, calling the company the best China electronic vehicle player,” as reported by The Fly.