Tesla's `Out of Left Field' Price Cut Disappoints Street
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Tesla Inc. shares dropped as much as 10 percent on Wednesday after the company reported fourth-quarter Model 3 deliveries just below estimates and said it would lower the price of its cars, prompting at least one analyst to flag the selloff as “overdone.”
The electric vehicle maker said it would cut the price on its cars by $2,000, to help make up for U.S. buyers now being eligible for only a $3,750 federal tax credit for the next six months, half of what they previously received. The unexpected move triggered concerns about demand for Tesla’s cars, as well as the profit margin - two closely watched metrics for the company.