Tesla Temporarily Closes Stores in China Due to Coronavirus Concerns

As of February 2, Tesla temporarily shut down its stores in mainland China as the novel coronavirus worsens, according to a news report by CNBC on Thursday.

The CNBC report cites a post by a company sales employee on February 2, which wrote, “From today on, Tesla stores are all closed throughout China. But I will answer questions online, around the clock. Online orders are still welcome. We suggest all of you stay home, and take good care of your health.”

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Whether the shutdown applies to stores in Hong Kong remains unclear while Tesla’s China communications office hasn’t responded to requests for comment.

This move comes as many parts of China have been closed to contain the spread of the new coronavirus that has killed over 500 people in the country. Apple closed its stores in China over the weekend, citing public health concerns. Many other foreign brands have also temporarily suspended or restricted their operation in the virus-hit country.

Tesla’s share price dropped more than 17% on Wednesday after Tao Lin, the company’s vice president in China, announced a delay in delivery to customers that was originally scheduled in early February due to the virus outbreak.

Earlier this year, the electric car maker reported impressive fourth quarter results. “We view the China situation as critical in terms of TSLA’s ability to post a GAAP (generally accepted accounting principles) profit for Q1 and Q2 and clear the last remaining hurdle needed for the stock’s addition to the S&P 500 (four consecutive quarters of GAAP profit),” CFRA Research’s Garrett Nelson said Wednesday on Tesla’s sell rating.