Electric vehicle stocks fell across the board for a second straight week as risk aversion intensified on Wall Street after the December consumer price inflation report set off worries that the Federal Reserve could delay rate hikes. Market leader Tesla, Inc. (NASDAQ:TSLA) declined in all but one session of the week.
Here are the key events that happened in the EV space during the week:
Tesla’s Model 3 Refresh Launch In North America, China Price Cuts And More: About four-and-a-half months after Tesla launched its revamped Model 3 EV in China, the refreshed model made its way into North America this week. Two variants of the refreshed Model 3, namely the dual-motor long-range and rear-wheel drive, are now available for sale. The former has an estimated EPA range of 341 miles, up from the 333-mile-range for the comparable legacy model, and is priced at $38,990, while the RWD variant has a price tag of $45,990.
The Elon Musk-led company, meanwhile, spooked investors by downwardly adjusting prices in China even as investors began to discount stable prices in the new year. The company took down the prices of its Model 3 electric vehicles by 2% to 5% despite sales momentum picking up in the country. Future Fund’s Gary Black said that analysts may decrease their estimate of Tesla’s 2024 earnings by $1 billion or 25-30 cents per share in response.
In another negative headline, Hertz Global Holdings, Inc. (NASDAQ:HTZ) made a U-turn by shifting its allegiance back to gas-powered vehicles. In a filing with the SEC, the company said it decided to sell about 20,000 EVs from its U.S. fleet, or about one-third of the global EV fleet and reinvest a portion of the proceeds to buy ICE vehicles. This is an about-face from its stance in 2021, when it agreed to add 100,000 Tesla Model 3s to its fleet. Tesla went on to add Model Y to the order earlier this year.
Also, Tesla reportedly said it was suspending production in the Gigafactory Berlin-Brandenburg as the strife in the Red Sea resulted in considerably longer transportation times and created a gap in the supply chains. ”Due to a lack of components, we are therefore forced to suspend vehicle production,” the company reportedly said in a statement.
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