Tesla shares fell 17.18% Wednesday after a company executive said that cars initially scheduled for delivery in early February will be delayed due to the outbreak of the new coronavirus. The huge fall comes after two spectacular days for the stock earlier this week.
Tesla shares were up nearly 20% on Monday and another 13.7% on Tuesday. Tesla on Wednesday did avoid setting a record for its biggest single-day loss, which happened in 2012 when the stock fell 19.3%. But it was still the second-worst day for Tesla.
Tesla stock down was down as much as 20% during intraday trading Wednesday. The company’s market cap stands at $132.4 billion.
The electric carmaker began rolling out Model 3 vehicles from its Shanghai Gigafactory to Chinese customers in January.
Tesla has kept its Shanghai factory closed after the Lunar New Year following government guidelines due to the outbreak of the new coronavirus, which has now infected at least 24,000 in more than two dozen countries and killed about 490 in China.
“The proposed delivery (of cars) in early February will be delayed,” Tao Lin, vice president at Tesla, announced on Chinese microblogging service Weibo, according to a CNBC translation, in response to a question from a user. “We will catch up the production line once the outbreak situation gets better.”
Tesla Chief Financial Officer Zach Kirkhorn said on the company’s quarterly investor call last week that its Shanghai factory will remain closed for an extra week to week-and-a-half.
“This may slightly impact profitability for the quarter but is limited as the profit contribution from Model 3 Shanghai remains in the early stages,” he said.
China is seen as a potentially huge market for Tesla. Its stock has been on a tear.
Tesla shares closed up 13.7% Tuesday, at $887.06, a record high for the stock. The price had climbed as much as 23% Tuesday, hitting an intraday record of $968.99 per share. That comes after Tesla shares climbed nearly 20% on Monday, which was its biggest one-day jump since May, 2013.
But on Wednesday, Canaccord downgraded the company to a “hold” from a “buy,” although it kept its price target at $750 a share. The firm said investors should wait to purchase Tesla stock after the massive price rally it’s had.
— CNBC’s Will Feuer contributed to this report.