According to Chinese news from tmtpost.com, market research data disclosed by JL Warren Capital on Tesla (TSLA) shows that the number of newly registered Tesla Model S cars in China decreased by 45% in February 2015, compared to January 2015 (decreased from 469 in January to 260 in February). However, Chinese New Year occurs in February (generally celebrated over 7 days) , which may have caused the slowdown in the car registration.

Tesla’s Operational Difficulties in China

We believe the month-to-month decrease in Tesla Model S car registrations is a continued indication of Tesla’s operational difficulties in China. In terms of revenue contribution, the Chinese market is still not significant, but it’s one of the biggest components of Tesla’s growth plan moving forward. Priced into Tesla’s speculative multiple is the assumption that the company is going to be able to move swiftly into China and grow uninterrupted.

Recall, at the start of the new year Elon Musk’s line was that the company’s China woes were going to correct later in the year. In February, Musk commented that the company’s problems in China had been “blown way out of proportion.”