China’s EV Growth Is Stagnating. Is That Another Nail in the Coffin for Tesla Stock?

Core Insights - A slowdown in China's electric vehicle (EV) sales has raised concerns for Tesla, with October sales growth dropping to 7.3% from 15.5% in September [1] - Tesla's sales in China have been weak, with a reported decline of 36% year-over-year in October, marking a three-year low with only 26,006 vehicles sold [2] Group 1: Sales Performance - Overall car sales in China decreased by 0.8% year-over-year in October, contrasting with a 6.6% increase in the same month [1] - Tesla experienced a year-over-year sales decline in six out of the first ten months of 2025 [2] Group 2: Strategic Initiatives - Tesla is not abandoning the Chinese market; instead, it is implementing strategies to counteract declining sales [3] - The introduction of a longer-range rear-wheel-drive Model Y variant in November 2025 resulted in a 9.9% increase in registrations compared to November 2024 [4] - Tesla is developing a more affordable version of the Model Y, aiming for production costs approximately 20% lower than the refreshed Model Y introduced in 2024 [5] Group 3: Manufacturing and Supply Chain - The Shanghai Gigafactory is a strategic asset for Tesla, producing all vehicles sold in China, which provides cost and supply-chain advantages over imported competitors [6] - Local manufacturing allows Tesla to quickly adjust production in response to demand changes and facilitates vehicle exports to other regions, helping to manage global inventory and sales fluctuations [6]