Tesla share price fall to two-year low on US-China trade tensions
Tesla closed Monday’s session lower by 5.22% or US$12.51, to US$227.01.
Shares of automotive firm Tesla plummeted to a two-year low on Monday, falling as much as 6.3% to US$224.50, the lowest intraday decline since January 2017 as the escalating trade war between the United States (US) and China affected automakers.
Tesla closed Monday’s session lower by 5.22% or US$12.51, to US$227.01. Pre-market trading on Tuesday had the stock lower by 0.33% or US$0.76.
Tesla brought the 27-member Bloomberg World Auto Manufacturers Index down as much as 1.6% to the lowest intraday since January 7.
In January, Tesla broke ground on a battery and vehicle factory in Shanghai and according to the firm’s chief executive Elon Musk, production at the plant could reach a rate of as much as 2,000 cars a week there by the end of the year.
On Monday, China slapped a 25% tariff on US$60 billion worth of US goods. Although Tesla was not included in the tariff list, the move tightens the grip on any relief from US cars from Chinese taxes.
China’s latest tariffs hike was a retaliation from the US which hiked tariffs on US$200 billion worth of Chinese goods to 25% from 10%. The hike affected 5,700 categories of Chinese products, including internet modems and routers.
Other automotive stocks such as Germany’s Daimler and BMW also saw their shares close lower by 3.3% and 1.2%, respectively. The carmakers are the biggest importers of vehicles made in the US to China. Ford Motor fell as much as 3.3%.
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