Tesla's China EV Sales Surge In December, Outperforming Nio, XPeng, Others

Tesla, Inc.'s TSLA China sales rose to a record in December, Reuters reported Monday, citing data released by the China Passenger Car Association.

What Happened: Tesla reported wholesales of 70,847 units in China in December, a 34% increase from the 52,859 cars it sold in November. On a year-over-year basis, the increase was about 200%.

The company exported merely 245 units in December, which left domestic sales at 70,602 units. In November, the company's exports and domestic sales stood at 21,127 units and 31,732 units, respectively.

The anemic export numbers do not come as a surprise, as CEO Elon Musk had confirmed earlier through a tweet that the company makes cars for export in the first half of the quarter and for the local market in the second half.

In October, the breakdown between exports and domestic sales in China was 40,666 units and 3,853 units, taking total wholesale sales in China to 54,391 units.

December's robust China sales statistic was widely expected after Tesla reported record fourth-quarter global deliveries of 308,600 units earlier this month. 

Tesla's December number looks commendable when weighed against overall EV sales in China. The CPCA reported that new energy vehicle sales, comprising both battery EVs and plug-in hybrid EVs, were at 505,000 units in December, about 139% higher than a year ago and up 17.8% from November.

Tesla has outperformed the industry in terms of both year-over-year and sequential growth.

Related Link: Elon Musk Calls This Tesla Model The EV Maker's 'Best-ever Car': Here's Why

Tesla's U.S.-listed Chinese peers Nio, Inc. NIO, XPeng, Inc. XPEV and Li Auto, Inc. LI all previously reported strong deliveries for December. 

Nio's deliveries rose 49.7% year-over-year but slipped modestly quarter-over-quarter to 10,878 units. XPeng, meanwhile, reported a 181% year-over-year jump and a 2.5% month-over-month increase in December deliveries, which totaled 16,000. Li Auto's deliveries climbed 130% year-over-year in the month.

Warren Buffett-owned BYD Company Limited BYDDF reported BEV sales of 48,317 units in December, up 148% year-over-year and 4.7% higher than in the previous month.

Why It's Important: China is a key market for Tesla from the perspective of both production and sales. China is among the countries that have high EV penetration and potential as well. Tesla vehicles produced in Giga Shanghai have higher margins and are therefore key to Tesla's profitability.

"The linchpin to the overall bull thesis on Tesla remains China, which we estimate will represent 40% of deliveries for the EV maker in 2022," Wedbush analyst Daniel Ives said in a late December note.

The China story is worth $400 per share to the Tesla story for 2022, the analyst added.

In premarket trading, Tesla shares were up 3.03% at $1,058.12. 

Related Link: Why This Tesla Analyst Thinks Model Y Production At Giga Austin Will Kickoff In A Week's Time

Photo courtesy of Tesla. 

Posted In: NewsGlobalMediaChinaelectric vehicles
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