Tesla Inc. (TSLA) values plunged in trading after news it was cutting prices on the Model 3 to make up for the reduced federal tax credits in the U.S. On the other hand, Tesla confirmed receiving nearly 14,000 Model 3 orders for Europe — which has become a focus for the company. Orders are also open to China.
With 56,065 Model 3s delivered, less than the projected 63,150, Tesla was at 300.51, down 3.19% as of January 3, 2019. Aside from delivery issues, U.S. demand is down after the $7500 federal tax credit was eliminated.
The $2,000 price cut on all three models — meant to help compensate for the reduction in federal tax credits for EVs — seems to have reinforced negative sentiment, or at the least made little impact on confidence. Investor’s still don’t know if Tesla will be profitable, and may not know for some weeks, although it did build 61,394 Model 3s in the last three months.
The main focus of Tesla will be filling Model 3 orders, especially in Europe and China — in part to offset the loss of revenue in the U.S.
On the Model S and Model X, 2018 also fell slightly short of the goal of 100,000 deliveries, although it was closer with 99,394 confirmed deliveries.