To The Moon

Let's look at Tesla production in China for what it is.

Back in Sept 2022, they were making 82000 model 3/Ys a month. Then demand started slowing down due to competition. Inventories rose. Tesla cut back production and lowered prices. BYD deliveries outpaced all others including Tesla for the quarter and year. The government incentives ran out. Tesla still had inventory on its hands. They lowered prices again in January fearing further drop in demand due to competition, COVID spread, government incentives expiring and Chinese new year shutdown.

In December they cut production about 30% through shortened work shifts and a 10 day Christmas shutdown.

So production was drastically cut back.

In January, Chinese car buyers who missed out on the govt incentives started considering not only Tesla but all Chinese car makers because they also cut their prices in a price war to grab customers. Also, some buyers wanted to buy before Chinese new year shutdowns.

So there was a bump up in demand, but Tesla was still operating on scaled down production which they had extended from December.

So orders of course would outpace production if production was at a crawl.

Ramping up production over the next 2 months of the quarter to 80k per month is still less than what they had been producing last September. And they need to play catch up for the Chinese new year production.

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