Please ensure Javascript is enabled for purposes of website accessibility

Why Tesla Stock Moved Higher on Monday

By Daniel Sparks – Feb 10, 2020 at 11:24AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The electric-car maker's factory in China is reportedly up and running again.

What happened

Shares of Tesla (TSLA -6.32%) popped on Monday, rising as much as 9.6%. As of 12:00 p.m. EST, however, the stock was up about 2%.

The stock's move follows a report over the weekend that the electric-car maker's factory in Shanghai will resume production on Monday with the help of the Shanghai municipal government.

A red Tesla Model 3

Tesla's Model 3. Image source: Tesla.

So what

Tesla previously delayed the reopening of its factory in China following a pause in production for the Chinese Lunar New Year, citing concerns about the coronavirus outbreak in the country. But Tesla's new factory will resume production on Feb. 10, Reuters reported on Friday evening.

"In view of the practical difficulties key manufacturing firms including Tesla have faced in resuming production, we will coordinate to make all efforts to help companies resume production as soon as possible," Shanghai government spokesman Xu Wei told Reuters.

Now what

Tesla's new factory in China is critical to the company's growth plans in 2020. The new factory is building vehicles specifically for the local market, allowing the automaker to bypass a costly import tax.

By being able to price the Model 3 competitively in China, Tesla is positioned to capitalize on strong growth in the world's largest auto market.

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Tesla, Inc. Stock Quote
Tesla, Inc.
$223.07 (-6.32%) $-15.06

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/07/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.