Tesla reported production numbers on its flagship Model 3 sedan, although it warned that new Chinese tariffs will crimp sales in Asia.
The Silicon Valley-based electric-car maker, which, is struggling to emerge from months of turmoil around its Chief Executive Elon Musk, delivered a record 83,500 cars, above Wall Street estimates of 80,000.
That included 55,840 deliveries of the mass-market Model 3 sedan, whose ramp-up is widely seen as crucial to the company’s drive to become profitable. Wall Street had expected 55,600.
Still, Tesla’s stock sank more than 3 percent after spooking Wall Street with its warning that new Chinese tariffs will force it to accelerate investment in its factory in Shanghai.
“The fact that they hit their operational guidance is a positive, but some their commentary around China raised questions about their sales,” CFRA Research analyst Garrett Nelson told The Post. “It appears that their margins are under severe pressure there.”
Tesla said it was speeding up construction of its Shanghai factory as it seeks to combat a huge competitive disadvantage against other producers and even other imported cars, which it said are carrying a lower 15 percent tariff.
“Tesla is now operating at a 55 percent to 60 percent cost disadvantage compared to the exact same car locally produced in China,” the company said.
China gloom aside, CFRA raised its target price for Tesla to $285 from $225 following Musk’s settlement with the SEC last weekend that removed him as chairman of the board but kept him on as CEO.
“The stock trades with an Elon Musk premium, in our view,” Nelson said. “It’s valued much more like a high-growth software company than an auto manufacturer.”
“Clearly, it’s a reflection of the value that Musk can bring to a company, given that he is a visionary,” he added.
Tesla produced over 5,300 Model 3 cars in the last week of September, falling short of its target of 6,000.
Overall in the third quarter the company produced 53,239 Model 3s in the third quarter, in line with its target of 50,000 to 55,000 Model 3s, and delivered 55,840 of the vehicles to customers.
Tesla first met a long-held target of 5,000 vehicles per week at the end of June after a series of production bottlenecks and delays. Since then the company has been striving to sustain and increase that level.
Tesla shares ended the day at $301.02, down 3.1 percent.


