Tesla Inc.'s (TSLA) Model 3 registrations in California are down 37% in April and May combined compared with April and May 2019, Dan Ives of Wedbush said in a note Wednesday. "The Street was bracing for bad news around US Model 3 sales during the height of the lockdown in April and May and this morning the band-aid got ripped off," the analyst said. The state is Tesla's "core sweet spot" and expectations of a decline in deliveries have been reflected in Wall Street reducing Tesla delivery forecast to roughly 400,000 from around 550,000 before the coronavirus pandemic. Investors turn to "the trajectory in the month of June and especially into the core summer months heading into fall in hopes of a rebound as (the Tesla factory in Fremont, Calif.) enters 2H," Ives said. Growth in China is offsetting some doom and gloom in California numbers, the analyst said. Strong Model 3 demand in China "remains a ray of shining light for Tesla in a dark global macro and appears to be on a run rate to hit (100,000) unit deliveries in the first year" of Tesla's Shanghai factory, he said. Tesla shares were higher Wednesday amid broad market weakness and are 137% higher this year, contrasting with losses of 3.4% and 8.2% for the S&P 500 index and the Dow Jones Industrial Average .
-Claudia Assis; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
June 17, 2020 11:37 ET (15:37 GMT)
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