During intraday trading, Tesla plummeted by 7.5%, with a market value evaporating over $40 billion. It has already dropped by about 25% year-to-date.

On Monday, Tesla's stock price opened low and continued to decline, falling more than 7.5% during the day, marking the largest single-day drop since the earnings report was released on January 25th. It was the worst-performing stock among the S&P 500 components that day, with a market value loss of $40 billion.

Some analysts pointed out that Tesla's sharp drop on Monday was related to its latest sales data in China. Additionally, the price cuts in January and the new incentive measures introduced last week in China by Tesla have highlighted the intense market competition.

On March 4th, the China Passenger Car Association released the estimated wholesale sales data for major new energy passenger car manufacturers in February 2024: BYD's wholesale sales were 121,748 vehicles, while Tesla's wholesale sales in China were 60,365 vehicles. Tesla's sales decreased by 19% year-on-year, hitting the lowest level since December 2022. It is worth noting that February coincided with the Chinese Lunar New Year holiday, leading to reduced car buying activities.

BYD and Tesla, the top new energy vehicle companies, kicked off a new round of price cuts on March 1st, intensifying the "price war" in the Year of the Dragon car market. This may further accelerate market reshuffling, with the "smoke of war" in the new car price war:

• XPeng announced that until March 31, 2024, all models of the XPeng G6 will be reduced by 20,000 yuan, with a discounted starting price of 189,900 yuan. An XPeng spokesperson mentioned that this is XPeng's first price cut in 2024, aligning with the trend and the overall situation.
• In addition to XPeng, GAC Aion announced a price cut on March 3rd.
• Previously, on March 1st, BYD, Tesla, and 9 other car companies had already announced price cuts or limited-time discounts, with the highest reduction reaching 47,000 yuan.

Due to the impact of the Spring Festival holiday, the delivery volume of new forces in the automotive industry generally did not meet the levels of January. The delivery volume of new forces in the automotive industry in February decreased compared to the previous month, with the "price war" continuing to heat up. Except for AITO Aito and Li Auto, the sales of other new car manufacturers did not exceed ten thousand units.

Citing Ouyang Minggao, academician of the Chinese Academy of Engineering, Securities Daily reported that from an industry perspective, the new energy vehicle market is transitioning from incremental development to stock competition. According to Shanghai Securities News, industry experts believe that 2024 is a crucial year for new energy vehicle companies to establish themselves, with fierce competition expected.

Tesla also experienced a dismal stock price decline at the beginning of last year, but quickly turned the tide and eventually doubled its value for the whole year. So far this year, Tesla's stock price has fallen by about 25%, significantly underperforming the broader U.S. stock market, with the S&P 500 rising nearly 8% year-to-date.