EV stocks rose in morning trading, as sales strong. Li surged 8%. Li Auto reported May deliveries of 4,323, up 101% from the same period last year, but down 22% from April.
Tesla sales in China rebounded in May, amid growing government scrutiny and global chip and battery shortages. Tesla stock rose Tuesday.
China Passenger Car Association data shows Tesla sold 33,463 EVs in May, up 29.5% from 25,845 in April. Tesla sales were 35,478 in March.
Tesla China wholesale sales were 33,463 in May, including 21,936 in domestic sales and 11,527 for export. That's according to the China Passenger Car Association.
In May, Tesla exported 11,527 vehicles from China. Tesla's local sales surged 88% vs. April to 21,936.
April's shipments declined 27% from March, but excluding 14,174 vehicles that were shipped to Europe, domestic sales was actually 67% month over month. Prior reports excluded Tesla exports.
The May sales rebound in China follows weeks of state media coverage regarding customer complaints and increased government oversight. Last week, a report said that Tesla orders nearly halved in May. But Tesla orders from last month may not be filled until this summer.
"Tesla appears to have handled the shaky China PR issues and turbulence well as demand rebounded well ahead of expectations," said Wedbush analyst Daniel Ives in a note to clients Tuesday.
China EV Sales Strong
Meanwhile, Tesla's China-based rivals reportedstrong May saleslast week. Nio(NIO) deliveries rose 95% to 6,711 electric SUVs in May. But month-over-month deliveries fell about 6%.
Xpeng(XPEV) deliveries leapt 483% year over year to 5,686 EVs in May, and 10% from April. Li Auto(LI) reported May deliveries of 4,323, up 101% from the same period last year, but down 22% from April.
China's new electric vehicle sales, which include EVs, hybrids and fuel cell vehicles, surged 177% to 185,000 cars in May from a year earlier, CPCA said. EV sales alone leapt 186% to 162,000.
Overall passenger vehicle sales, however, rose just 1.1% to 1.66 million cars.
Despite a recent rough patch that includes Autopilot safety concerns and the chip shortage, Ives is confident in Tesla's long-term ability to lead in the region.
"Only 5% of auto sales in China are EV driven today, and we believe this transformational consumer demand will see a doubling of EV deliveries in this key region over the next two years with Tesla a major beneficiary along with domestic pure plays NIO, Xpeng, Li Auto and others," he said.
Ives has an outperform rating on Tesla stock and a price target of 1,000.
Tesla Stock
Shares rose 0.9% to 610.66 on thestock market today. Tesla stock has regained support at the 200-day line. It is still below its 50-day line,MarketSmithchart analysis shows. Its relative strength lineis rebounding.
Nio stock advanced 1.4% Tuesday. Xpeng stock rose 4and Li Auto climbed 8.3%.
China accounts for 30% of Tesla's sales. It is the second-largest market for the EV maker, behind the U.S.
Beijing officials warmly welcomed Tesla early on, as it facilitated the opening of its Giga Shanghai plant in 2019. But recent consumer complaints about Tesla vehicle safety and the company's response to criticisms have irked Chinese officials. The strained relationship has resulted in bad PR for the U.S.-based electric carmaker.
Global chip and battery shortages have also stymied Tesla's growth plans. Most recently, the companyscrapped plans to make a Plaid Plusversion of its luxury Model S vehicle. While CEO Elon Musk tweeted the decision was made because the Plaid was "good enough," some industry observers have said the reversal could be due to battery supply issues.
The Plaid Plus, along with the Cybertruck, Tesla Semi and some future Model Y vehicles, were all slated to use 4680 battery cells, which are supposed to offer a big advance in range and cost. But Tesla has said mass production of the 4680 battery cells may not occur until well into 2022.
Meanwhile, long-term executive Jerome Guillen has stepped down, Tesla announced late Monday. Guillen, who helped launch the Model 3 and Model Y, had transitioned to head up the Tesla Semi development in March.