On Thursday, Tesla stock fell by more than 8 per cent by the time the markets closed. Tesla stock had entered bear territory earlier this week, due to reports that the Fremont, California plant of Tesla was shut down and weak market sentiments. On Friday, Elon Musk confirmed this news about the plant.
He posted the electric vehicle company’s Fremont plant was shut down for two days this week due to parts shortages. But now it has restarted. During the temporary shutdown, the production of Tesla’s less expensive sedan, the Model 3, was hit.
The Fremont plant can annually produce 5 lakh units of Model 3s and Model Ys. Meanwhile, last week, Tesla reduced the price of its cheaper variants of the Model 3 and the Model Y, the latest in a series of price cuts.
Last month, Tesla had stated that it might face a temporary impact from a global semiconductor shortage and logistics disruptions at ports.
Tesla is not the only company hurt by this shortage. Several automakers, including General Motors, Volkswagen and Ford are hit by the shortage of chips. This led them to scale down production.
On Friday, Tesla’s share was priced at USD 675.50 per piece during the closing session. Meanwhile, Tesla was not the only stock that was hit.
While Tesla was one of the worst-performing stocks, Apple, Amazon, Alphabet and Facebook plunged by more than 3 percent.