The start of the year hasn’t been great for electric-vehicle enthusiasts. The cold in Chicago stranded some unlucky EV drivers. Tesla has cut prices in China and Europe. Ford Motor is scaling back production of its F-150 Lightning electric truck in the U.S.
Worst of all, the stocks of EV producers have just been terrible in January, and Friday trading is no exception.
Tesla stock was down 1.6% in midday Friday trading at $208.51. That’s left shares down 16% so far in January. The S&P 500 and Nasdaq Composite were up 0.5% and 0.6%, respectively.
Tesla is on the cusp of an ignominious record. If shares clos lower on Friday, it will be the 10th trading day of losses out of the first 12 — the worst start of any year in Tesla’s history. Shares fell nine out of the first 12 trading days to start 2015 and 2016.
Still, Tesla’s recent performance looks absolutely glowing compared to some peers. Shares of Chinese EV makers NIO, XPeng, and Li Auto were off 4.5%, 4.1%, and 3%, respectively, in Friday trading. For January so far, NIO shares were down 34%, while XPeng dropped 35%, and Li shares were down 25%.
There isn’t much new to pin Friday’s declines on. Instead it’s a continuation of a significant theme: Chinese EV price wars that have weighed heavily on investor sentiment.
U.S. EV producers haven’t been spared investors’ ire. Rivian Automotive shares were down 1.2% in Friday trading leaving them off 34% year to date. Fisker shares were down 2.2% despite catching an upgrade on Thursday evening to Hold from Sell. Its stock was down about 55% year to date through midday trading Monday.
Downgrades, production cuts from Ford, and even disappointing delivery numbers from EV start-up VinFast Auto, along with controversial tweets by Tesla CEO Elon Musk asking for some $30 billion in more Tesla stock have contributed to recent weakness. There are a lot of reasons why investors are selling.
Figuring out when, or why, the selling will stop is another matter, but earnings could help. Tesla will report fourth-quarter earnings on Wednesday, Jan. 24 after the market closes. Wall Street is looking for earnings per share of 73 cents. Along with an earnings beat, any commentary from Musk about stable pricing or improving profit margins would go a long way to helping sentiment.
Then there are stock market technicals. Market technicians will look at stock charts to get a sense of where any stock can go over the short or medium term.
Tesla stock, for instance, is oversold — a term technical traders use to describe a stock that has gone down a lot, quickly. Oversold stocks are typically due for a bounce because all the bad news is reflected in shares. That’s one item Tesla bulls can take some solace in. What’s more, Fairlead Strategies founder Katie Stockton sees some support for Tesla stock at $208 — right around where shares were trading on Friday.
Write to Al Root at allen.root@dowjones.com