Actions of You’re here (NASDAQ: TSLA) Shares of the leading electric vehicle (EV) maker have been on a recent rally, and that trend continued into the first day of trading in July. Shares of the leading electric vehicle (EV) maker were up 5.5% as of 11:10 a.m. ET Monday morning. The stock is now up about 18% over the past month.
Today’s jump comes just a day before Tesla releases its electric vehicle delivery numbers for the second quarter. Although estimates are trending lower, delivery reports from Chinese electric vehicle makers released today are making investors more optimistic about what the U.S. company will say.
The important Chinese market for electric vehicles
The Chinese electric vehicle market has been crucial for Tesla, whose most productive factory is in Shanghai. Today, several Chinese electric vehicle makers reported strong deliveries in June and the second quarter. That could bode well for what Tesla will have to share tomorrow.
Nio, Li Auto, XPengand the biggest BYD all showed year-on-year growth Battery Electric Vehicle (BEV) Sales for the quarter. The period appears to have ended on a positive note, as Nio delivered a monthly record of 21,209 vehicles in June. This is almost double what it delivered in June 2023.
Many EV watchers have been keeping a close eye on the larger BYD, whose BEV volume is more in line with Tesla’s. BYD sold more than 426,000 fully electric vehicles in the second quarter, up about 21% year over year.
Tesla analysts have lowered their sales estimates for the second quarter, with the most recent projections calling for an average of about 420,000 electric vehicles. That would be down from 466,000 vehicles delivered in the same period a year earlier. It would also be the second quarter in which BYD surpasses Tesla to become the world’s largest seller of electric vehicles.
China’s electric vehicle market appears to be recovering, and Tesla could beat estimates. But even after that data is released, shareholders will want to continue paying attention to what’s happening. Tesla talks about its profit margin when it releases its full second-quarter financial report. If sales in China come from lower prices, the stock rally could be short-lived.
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Howard Smith holds positions in BYD Company, Nio, Tesla, and XPeng. The Motley Fool holds positions in and recommends BYD Company, Nio, and Tesla. The Motley…
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