Yahoo Finance's Pras Subramanian discusses the latest news from Tesla as the EV maker announced it will cut production of Model Y cars out of its Shanghai factory in December.
- We're also watching shares of Tesla this morning, TESLA. It's down, pre-market, by about 3%, following a report that the company is cutting production in its Shanghai factory. Yahoo Finance's Pras Subramanian tracking this story today, joining us now. Pras, what do we know so far?
PRAS SUBRAMANIAN: Hey, Brett, how you doing, man? So a bit of good news and bad news today for Tesla in China. Earlier today, they reported over 100,000 sales for the month, which is an all-time record for them.
But, like you said, reports coming from Bloomberg and Reuters talking about a production cut as well. They're reporting around a 20% cut that could take place as soon as this week. That would put Tesla down to on 80,000 vehicles a month production capacity at Giga Shanghai, which is nothing to sneeze at.
But the concern is that there's the demand slowing-- their demand slowing story there. We saw price cuts earlier this month. We saw them add some insurance incentives for buyers of new cars.
So while these are happening, there's concern that demand lever is sort of slowing. And then also we see BYD, their competitor in China, with even more sales, over 100,000 EV sales alone, plus another 115,000 hybrids.