5 Auto Companies Facing Worst Declines Amid Global Chip Shortage

2. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 60    

Tesla, Inc. (NASDAQ:TSLA) is placed second on our list of 10 auto companies facing the worst declines amid global chip shortage. The firm engages in the development and sale of electric vehicles and is headquartered in California. In the second quarter earnings call, Elon Musk, the chief of the firm, said that the company had halted production of electric vehicles at the factory in Shanghai due to the chip shortage. The firm has made tweaks to software and is looking to source chips from alternative suppliers to keep up the production and sales of EVs. 

On September 17, investment advisory Wedbush reiterated an Outperform rating on Tesla, Inc. (NASDAQ:TSLA) stock with a price target of $1,000, noting that the demand story for the EVs manufactured by the company was just starting to play out. 

At the end of the second quarter of 2021, 60 hedge funds in the database of Insider Monkey held stakes worth $9 billion in Tesla, Inc. (NASDAQ:TSLA), down from 62 in the previous quarter worth $10 billion.

Here is what Baron Partners Fund has to say about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2021 investor letter:

“Tesla, Inc. designs, manufactures, and sells fully electric vehicles, solar products, energy storage solutions, and battery cells. The stock fell during the quarter as a result of general market dynamics and a potential production slowdown due to parts shortages. A refreshed S/X and China Model Y ramp could also have a negative impact on margins in early 2021. We anticipate strong growth and improved margins driven by new production capacity, manufacturing efficiencies, localization of its manufacturing and supply chain, and maturation of Tesla’s full self-driving technology.”