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Tesla shares close lower on Monday, company postpones plan to restore production in Shanghai to pre-lockdown levels

Tesla Inc (TSLA) has postponed a plan to bring back output at its Shanghai facility to levels prior to the city’s COVID-19 lockdown by at least 1 week, Reuters reported while citing an internal memo.

Initially, the US electric vehicle maker intended to ramp up production at its Shanghai facility to 2,600 cars per day from May 16th.

However, according to the recent memo, the company intends to continue with one shift at its Shanghai factory for the current week and with a daily production of about 1,200 units.

Tesla also said it would now seek to bolster daily output to 2,600 units from May 23rd.

Tesla Inc still faces challenges to double the number of its employees who will live and sleep near production lines in an attempt to maintain “closed-loop” operations, Reuters reported, citing a source with knowledge of the matter.

Companies in Shanghai can reopen only if they organize their operations in such a way that their workers remain in isolation.

Tesla shares closed lower for the sixth time in the past ten trading sessions on NASDAQ on Monday. It has also been the steepest single-session loss since May 11th. The stock went down 5.88% ($45.22) to $724.37, after touching an intraday low at $719.09. The latter has been a price level not seen since May 12th ($680.00).

Shares of Tesla Inc have retreated 31.45% so far in 2022 compared with a 15.91% loss for the benchmark index, S&P 500 (SPX).

In 2021, Tesla Inc’s stock went up 49.76%, thus, it outperformed the S&P 500, which registered a 26.89% gain.

Analyst stock price forecast and recommendation

According to TipRanks, at least 14 out of 28 surveyed investment analysts had rated Tesla Inc’s stock as “Buy”, while 9 – as “Hold”. The median price target on the stock stands at $975.39.

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