Gordon Johnson: Tesla Just Posted Its Second Straight Sequential Decline In Shanghai Sales Numbers
December 8, 2021 |Gordon Johnson: Tesla Just Posted Its Second Straight Sequential Decline In Shanghai Sales Numbers
Gordon Johnson of GLJ Research is out with a note on Wednesday morning stating that Tesla missed the consensus estimate of 57,800 sales in China for November.
His note says that CPCA data reported that Tesla posted sales of 52,859 units, which break down to 31,732 domestic deliveries and 21,127 vehicles made in China and exported to the rest of the world.
Johnson notes that this is the second consecutive month sales out of the Shanghai plant declined.
The sequential decline comes "despite higher production in each of the past two months – and this is despite rebates TSLA offered at the beginning of Nov. to move cars," Johnson wrote.
Tesla also lagged in gaining market share behind the "Big 3" in China, his note says: "While TSLA did see 411bps of share gains in the domestic Chinese NEV auto market month-over-month, the 'Big 3' saw their market share jump by 495bps MoM."
The miss in total numbers Johnson attributes to a "big miss in exports", where Tesla saw 21,100 cars exported versus estimates of 28,200 vehicles.
Johnson said that these numbers have caused one sell side analyst to adjust his Q4 delivery model:
One forecaster (the pundit many sell-side analysts model their forecasts after) informed us this morning that these numbers were a disappointment vs. his Nov. 2021 forecast; in fact, this forecaster told us this numbers mean he’ll have to adjust his 4Q21 delivery est. lower from 281K due to “sub-280K” due to lower than expected sales in Europe (we are maintaining our 4Q21 delivery est. of 280K vs. the current Consensus est. of 262K – i.e., we expect a “beat”).
Johnson still predicts growth of 38,609 vehicles for Q4, down from unit growth of 40,141 in Q3.
Johnson takes this data and turns a critical eye to comps that Tesla is going to have to meet in 2022, stating:
"Why is this important? Well, given Consensus is modeling TSLA’s 2021 sales at around 890K, jumping to 1.3mn in 2022, the expectation is TSLA sells ~400K more cars sold 2022E vs. that sold in 2021E, or ~100K incremental cars sold in each quarter through 2022E.
"Thusly, to jump from ~39K incremental units sold in 4Q21 to ~100K units/qtr incrementally sold in 2022E, TSLA will have to aggressively ramp its Texas/Brandenburg facilities, and see a stair-step increase in demand globally," Johnson wrote.
"Yet, with Nov. 2021 China figures missing the Consensus est., and TSLA’s incremental sales at a fraction of what’s necessary to meet the Consensus est. next year, it may be time for bulls to start worrying about the big increase in sales necessary for TSLA next year vs. how things are trending currently (i.e., how do you sell out a new factory in Germany, when your Shanghai plant can’t sell out its existing capacity?)."