Tesla shares drop as Elon Musk issues warning for China and Europe
Tesla shares fell on Thursday after Elon Musk warned it had become a “little harder” for the company to garner demand amid a weakening of the global economy. Six brokerages lowered their price targets on stock.
Wedbush Securities made the biggest cut of $60 (£53.50) to bring its target to $300 (£267.51).
The news comes after Mr Musk issued a recession warning.
Speaking in a conference call on Wednesday, the Tesla CEO claimed that China and Europe are experiencing “a recession of sorts”.
He then suggested that the recession was causing demand to be “a little harder than it otherwise would be”.
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Tesla also looks set to miss out on its annual delivery targets due to limited transportation capacity.
The electric car maker delivered 343,830 between July and September.
The record number came courtesy of increased production in China.
However, the figure was still less than expected as supply chain issues and car shipping problems persisted.
Analysis by JP Morgan revealed: “The results will likely add to debates about demand destruction that ensued after 3Q deliveries tracked minus five percent below company-compiled consensus.”
Wedbush analyst Daniel Ives added: “The bullish narrative is clearly hitting a rough patch as Tesla must now prove again to the Street that the robust growth story is running into a myriad of logistics issues as opposed to demand softening.”