Tesla shares weather SVB’s financial crash as shipments to China increase
Tesla (TSLA) insurance enrollments in China rose for a fourth straight week, as Tesla stock managed to rally since the collapse of SVB Financial began to weigh on institutions and the broader market. . Meanwhile, Moody’s has upgraded Tesla’s credit rating out of junk.
Tesla had 18,712 insurance enrollments for the week of March 13 to 19, up 10% from 17,032 in the previous week. The global EV giant had 12,478 Model Y registrations last week and 6,623 Model 3 registrations. Tesla saw its Model 3 sales increase by nearly 10% last week after increasing by 83% two weeks ago. The subscription provides a realistic measure of new car sales in China.
Tesla insurance enrollment in China has steadily increased since that number nearly doubled in the week from 20-26/2. The number of insurance registrations in China by the EV company in the past week jumped 216 percent, compared with 5,913 the previous month for February 13-19. Registrations throughout February slowed down due to the country’s Lunar New Year holiday.
Meanwhile, top competitor Tesla recorded an increase in insurance enrollment after numbers stalled for two weeks.
BYD (BYDDF) had a total of 38,414 insurance registrations, up 3% from last week. The China-based auto giant saw its insurance enrollment drop in a row in the weeks between February 27 and March 12. BYD dealers recently Discounts on many car models, join China’s massive price war started by Tesla.
Chinese electric car shares rise despite latest warning sign
Denza, a luxury EV maker 90% owned by BYD and 10% by Mercedes-Benz (DDAIF), there were 2,059 insurance registrations in the past week, an increase of 11% compared to the previous week.
China Startup-EV Automobiles (LIFE) saw registrations increase 28% to 5,438, fueled by the new L7 hybrid SUV. Nio (NIO) subscriptions drop 18% to 1,775 and XPeng (XPEV) registrations dropped 20% to 1,296.
Moody’s upgrades Tesla to investment grade
Moody’s Investors Service upgraded Tesla’s credit rating one notch to Baa3, giving it investment-grade status from its previous junk rating. S&P Global did the same in October. Investment grade from at least two major credit rating agencies is considered important.
Moody’s wrote that the outlook for the EV giant is stable and that it expects free cash flow to reach over $7 billion and debt restraint through 2025.
“Tesla will remain one of the leading battery-electric vehicle manufacturers with an expanding global presence and very strong margins,” Moody’s wrote on Monday.
Tesla shares rose 4.8% to 192.10 last Tuesday market trade. Shares rose 1.7% to 183.25 on Monday.
Since March 13, Tesla stock is up about 10% even as SVB Financial, Signature Bank of New York and Credit Suisse (CS) caused worries about broader financial instability.
Before the bank crash, Tesla sold off sharply from March 6 to 10, down 12.3%. However, TSLA stock has found support at the 50-day and 10-week moving averages.
Tesla stock is still bottoming, below the 200-day line. But that key level is now below a potential buy point of 217.75.
Shares of Nio, Li Auto and XPeng jumped between 4%-11% on Tuesday. BYD stock, which trades over the counter in the US, fell 0.4%.
Tesla China sales spiked in February
In February, Tesla sales in China increased sharply compared with a year earlier, according to data released by the China Passenger Car Association.
Tesla sold 74,402 Chinese-made vehicles last month. That’s a nearly 13% increase from January and a 32% increase in sales from last year’s 56,515. Tesla sold 51,412 Chinese-made Model Y vehicles and 22,990 Model 3 vehicles.
The majority (54%) of those vehicles are exported to Europe and elsewhere. Tesla exported 40,479 vehicles in February, up more than 3% from January and up 22% from a year ago. That means Tesla delivered 33,923 domestic vehicles in China over the course of the month. Tesla typically focuses on exports in the first half of each quarter.
Other Chinese electric vehicle manufacturers also mainly reported Sales increased significantly in February Compared with January, there is a Lunar New Year holiday.
Please follow Kit Norton on Twitter @KitNorton for more insurance.
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