The share prices for Tesla have suffered a major dip in the latest trading session. On Thursday, Tesla’s shares dipped 9% as analysts and shareholders are growing concerned about the company’s outlook.
Tesla Shares Dipped over Outlook Concerns
On Thursday, Tesla’s shares experienced a major dip and it happened as analysts grew concerned about the outlook of the electric vehicle maker.
The company has been facing major supply and demand issues and that is because of the Chinese lockdowns. As a result, analysts are concerned that the company may fail to achieve its earnings targets.
Since the start of the year until now, the company’s share prices have suffered a major dip. As per the records, Tesla’s shares had dipped almost 70% since the beginning of the year.
Share Price Targets are being reduced
One of the major blows dealt to Tesla’s shares was due to the action taken by the analysts at Canaccord Genuity. The analyst at the particular firm decided to lower their price target for the EV maker on Wednesday.
They had set the share price target for the EV maker to $304 per share. Given the current situation and problems being faced by Tesla, Canaccord Genuity has lowered the target to $275 per share.
In addition to the above-mentioned concerns, the analysts have also cited the distraught and cosmically bad shareholder base behind their decision.
The company is constantly losing the interest of the investors in its shares. The major problem is the CEO of the company himself who has become very controversial in recent months.
Musk started facing a lot of backlash from the shareholders after what he did to the executives and employees at Twitter. He went on a firing spree and that has cost Twitter tremendously, which he owns.
As a result, the shareholders have started to grow concerned about the future of the companies Elon Musk is handling. He even shared millions of shares that he owned at Tesla.
According to estimates, in the year 2022 alone, Elon Musk has sold over $15 billion worth of Tesla shares. Since November 2021, he has sold over $39 billion worth of Tesla shares.
According to Musk, he has done this to save the company from facing financial problems. The Canaccord Genuity analysts are very concerned about the latest activities of Elon Musk.
Tesla is Giving Discounts
Another major drawback for Tesla is the latest announcement that the company had to make in terms of its high-price vehicles.
The company made an announcement on Thursday that they have introduced $7,500 discounts on the vehicles they have been selling at a high price.
By reducing vehicle prices, they have attempted to increase their incentives. The company wants to double the incentives that it generated in the past quarter.
Due to the macroeconomic downtrends, the demand for Tesla vehicles has started to lower. However, due to COVID-19 in China, long-term lockdowns have been placed in the country.
As a result, several companies with production plants are facing supply chain issues. With the delays being in place, Tesla is trying its best to lower the prices of their vehicles.
By introducing discounts, the company is trying to encourage as many customers as possible to take deliveries and not cancel their orders.
In addition to the United States, Tesla has also offered credits to customers in Mexico and Canada, who waiting for a long time for their vehicles to be delivered.
Tesla had already cut down the vehicle prices in China amidst the huge delays in deliveries to Chinese customers due to massive lockdowns.
Additionally, Tesla is also offering free charging to customers for 10,000 miles who buy their vehicles in December.
The company is making all of these attempts to ensure that they end up meeting its targets. However, the situation is still looking bad for Tesla as more investment companies are losing their trust in its performance.