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Tesla tumbles as coronavirus disrupts Shanghai deliveries

The Chinese facility is set to restart production on 10 February after closing as a precaution

Tesla Inc - Tesla drops 17% as coronavirus hits Shanghai deliveries

Tesla Inc (NASDAQ:TSLA) hit switchback mode as the company announced coronavirus preventive measures will hit deliveries from its new Shanghai factory.

The Chinese facility is set to restart production on 10 February, a month after the first Model 3 sedans were first delivered to employees.

READ: Tesla stock goes into reverse in pre-market after Canaccord downgrade

The Shanghai plant is the first outside the US and is a key part of founder Elon Musk's plan to produce 500,000 cars annually.

The news initially wiped out 17% off the electric vehicles (EVs) maker’s share price, which closed at US$734 though there was a modest rally in pre-market trading to US$750.

Tesla shares have been stunning performers recently rocketing four-fold since last summer and topping a US$100bn market capitalisation just last month.

According to analysts, volatility is to be expected as a stock going parabolic.

Neil Wilson from Markets.com said US$600 is a “more realistic” price as there are execution risks such as EVs demand in China and debt.

“The shape of the chart now looks very intriguing and investors may find more attractive entry points before long,” he commented.

“Fundamentally overvalued, but that doesn’t mean it can’t go up again.”

Quick facts: Tesla Inc

Price: 835 USD

Market: NASDAQ
Market Cap: $154.78 billion

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