Tesla Shares Slip After Report That Company Has Lowered German Gigafactory Production Targets

Tesla shares are staring Wednesday off sliding more than 2% in the pre-market session after the company lowered the production target for its German plant to 4,350 vehicles a week in July in August.

The company had previously hit 5,000 vehicles a week, an initial report by Business Insider said, but plans to reduce its output further, with BI citing internal documents and anonymous sources. 

Tesla had previously disclosed in late March that it hit the 5,000 per month run rate at its newest plant in Gruenheide near Berlin. Business Insider and Reuters are reporting that this rate was a “one-off” and that average output since then has been “much lower”. 

The company said as recently as June that its production targets were “on track”, the report says, but new information shows that the company’s target for July had been lowered to 870 cars per day. On days like July 25 and July 28, the company only produced 692 and 806 vehicles, respectively, the report says. 

Internal targets have been moved lower to 750 cars per day, or less than 4,000 vehicles per week, the report says. In July, Tesla said it would be expanding the factory’s capacity to 1 million cars per year. 

This hasn’t been the only sign of potentially slowing demand for the EV automaker. Recall just days ago Tesla once again slashed prices of its Model S and Model X vehicles. The company posted on Weibo about one week ago that its Model S price was being cut 6.7% to 754,900 yuan ($103,477) from 808,900 yuan prior. The company’s Model X is priced 6.9% lower at 836,900 yuan, down from 898,900, according to Reuters. 

The news follows reports that Tesla was adding new, lower-range iterations of its Model S and Model X that would be priced $10,000 lower than previous base prices, Yahoo reported earlier this month. 

The new standard range Model S will start at $78,490 and will offer 320 miles of range and the standard range Model X will now be priced $88,490 and will have a range of 269 miles per charge. Tesla delivered just 19,225 Model S/X vehicles last quarter.