TESLA INC. (NASDAQ:TSLA): Price Cuts, Among Other Things, Put Pressures on Tesla's 4Q22 Gross Automotive Margin

 


Tesla stock gapped up 10.75% at the opening on Thu, just above the key trendline resistance, despite that the company reported "beat and miss" 4Q22 results. The stock has gained bullish momentum since early Jan and may be heading higher to test $165.80. Beware that a dragonfly doji candlestick pattern has emerged, signaling a potential reversal in price.

From the conference call, price cuts seem to be working as YTD orders came in at the highest level they have seen in company history. Tesla is now prioritizing sales over profits and demand seems not to be a problem at the moment. Nonetheless, one may want to keep an eye on the decline in the gross automotive profit margin, which sunk from 31% in 4Q21 to about 26% in 4Q22, the lowest in two years.

Let's hope there will be no further price cuts in the near future as it might turn into an EV pricing war.... "How Tesla’s price cuts could spur an EV pricing war", per CNBC.

This note contained herein is not and should not be construed as a recommendation to buy or sell. Click here to view the latest update!


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