Tesla Shares Open Higher After Positive California Sales Data
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Tesla Shares Open Higher After Positive California Sales Data

Tesla stock rose 1.7% at the opening bell on Tuesday after new data revealed a noteworthy sales jump in the California market.
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Electric vehicle (EV) sales saw a significant jump in California last year, with industry leader Tesla (NASDAQ: TSLA) increasing its share in that market to 13%. Tesla’s shares rose at the opening bell on Tuesday, opening at $195.29.

Tesla Closes in on Toyota in California

Shares of Tesla opened 1.7% higher on Tuesday following the release of new sales data indicating the EV leader is gaining ground on Toyota in the California market.

Notably, Tesla’s share of all light vehicles rose to 13% in California in 2023, reinforcing its position as the second-largest automaker in the state, closing in on Toyota (NYSE: TM), which experienced a decrease in market share to 15.7% last year from 17.3% in 2022. 

In 2023, Tesla’s sales in California rose by 24.6%, starkly contrasting Toyota’s modest 2.0% increase. These figures represent a significant change in dynamics in the California market, where Toyota held a 17.2% share in 2019, compared to Tesla’s 3.8%. 

The new data could suggest that California consumers increasingly favor Tesla, possibly due to its broad range of electric vehicles. In contrast, Toyota’s EV portfolio is considerably more limited.

The EV giant’s Model Y and Model 3 emerged as the top-selling vehicles in California, leading the market significantly. The Model Y experienced a substantial 52% increase in sales, reaching 132,636 registrations, while the Model 3 saw a 4.9% rise in sales, totaling 82,786 registrations.

Vehicle sales featuring internal combustion engines (ICE), encompassing hybrids and plug-in hybrids, saw a 5.2% increase in 2023, or 69,298 vehicles. However, since reaching their peak in 2016, sales of ICE vehicles have experienced a significant drop of 30%. Meanwhile, sales of EVs surged by 46.1% last year, or 120,204 vehicles, bringing the total figure to 389,000.

Cathie Wood Counting on Tesla Despite Recent Headwinds

Although limited, Tesla’s gains at Tuesday’s market open mark a boost for the company’s share price, which has been under significant pressure since the start of 2024.

Year-to-date, Tesla’s shares plummeted over 22%, due to a myriad of challenges including recalls, analyst downgrades, supply constraints, and most notably, a gloomy outlook compared to other Magnificent Seven giants. 

Still, many investors continue to count on Elon Musk’s company to make a turnaround, including ARK Invest CEO Cathie Wood, who has been buying the recent dip. This month, the fund manager acquired around 690,000 shares of Tesla across two ETFs operated by her ARK Investment Management. 

Cathie Wood believes Tesla’s stock is poised to make a turnaround after recent challenges. Do you share this bullish view? Let us know in the comments below.  

Disclaimer: The author does not hold or have a position in any securities discussed in the article.