Tesla’s China Sales Take A Pounding As Covid Lockdown Drags On

Musk sought to downplay concerns about the electric-car maker's operations in China last month after a three-week shutdown of its Shanghai plant.

The China Passenger Car Association said this week that there were 1,512 Model 3s and Ys sold in April, down from 65,814 in March. It was the lowest sales volume in China since April 2020 when the company began producing cars. China's new passenger vehicle sales fell 34% from March and 36% from April 2021.

The industry association said in a statement that the epidemic spread in 29 provinces and cities across the country.

China's demand for electric vehicles, combined with lower parts and labor costs, quickly turned its Shanghai plant into its top source of production, less than two years after it opened. During the company's first-quarter results call, when it posted record profit and vehicle deliveries, Musk said the company might still make up production losses in China in the second quarter.

The company's billionaire CEO said on the April 20 earnings call that they would see a record output.

The production resumed at the plant in late April with workers living round the clock, though output doesn't seem to be back to normal levels. There are shortages of parts, according to the report.

The easier part of the equation is to get your own plants up and running and your people back to work, says Michael Dunne, a long-time specialist on China.

For the first time in its history, the top production source for the company was the Giga Shanghai factory, which built Even as Covid restrictions continue, the company opened plants in Berlin and Austin to help offset challenges in China.

China is a very significant market, but it is probably 25% to 30% of our market, long-term, according to Musk at the Future of the Car conference on Tuesday. There is a hiccup with the Covid restrictions in Shanghai.

On Wednesday, the company fell 8.3% to $734. The stock is down 39%.