Any time a company improves its business in a major (and highly competitive) market is cause for celebration. That was the case on Thursday with electric vehicle (EV) pace-setter Tesla (NASDAQ: TSLA), which revealed that it’s getting its product to market more quickly in a key foreign country.
As a result, investors traded the company’s stock up by almost 5%, a figure much higher than the S&P 500 index’s 0.3% bump on the day.
Tesla wait times in China are coming down
As reported by stock market website StreetInsider.com, Tesla’s Chinese website updated its expected delivery time frames for its popular Model 3 sedan and Model Y crossover. Previous to those updates, Tesla last updated its projected times in November.
For the former model’s Long Range version, the EV company expects to deliver it from two to six weeks. That’s well down from the previous anticipated period of six to nine weeks. As for the Model Y Long Range, eager customers now only need to cool their heels for the same two to six weeks. Previously, they would have had to hold steady for six to eight weeks.
China, given its size and still-growing economy, is a key market for nearly every type of company. That goes double for EV makers like Tesla, as the government continues to push for greener vehicle solutions given historically high levels of air pollution.
The country is not an easy market
That’s why Tesla built and operates one of its “gigafactories” in the country, namely in the Shanghai area. While China is a country with vast potential, it’s also challenging for a relatively high-end foreign manufacturer. The government clearly favors domestic vehicle makers like Nio (NYSE: NIO), plus Tesla’s pricing can put its wares out of reach of many Chinese consumers. Any honing of the company’s competitive edge there is welcome.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nio and Tesla. The Motley Fool has a disclosure policy.
Why Tesla Stock Triumphed Today was originally published by The Motley Fool
