Tesla Inc. (TSLA) short-seller David Einhorn is confident that the electric car maker’s recent share price rally will prove to be short-lived.

The Palo Alto, California-based company’s stock has risen nearly 17% since its third-quarter earnings blew away Wall Street expectations in October. However, Einhorn, one of Tesla’s most prominent bears, isn’t about to call it quits on what is turning into an increasingly expensive sell trade.

Bloomberg reported that during an earnings call for Greenlight Capital Re Ltd, the hedge fund manager said that investors have gotten too carried away with Tesla’s results. He added that that they will be "as good as it gets" for the firm because robust sales of pricier Model 3 sedans are unsustainable.

Delivering more than 56,000 Model 3s to customers at an average selling price approaching $60,000 played a key role in helping Tesla to report its third profitable quarter last month. Einhorn, who has held a short position in Tesla for over year now, claimed that demand for the cars has now been exhausted.

“We believe this will be as good as it gets for the company,” the hedge fund manager said on the earnings call. “We believe they’ve exhausted most of the demand from customers who can afford the highest-priced versions of the Model 3.”

Einhorn, who is perhaps best known for shorting Lehman Brothers in 2007 before it went bankrupt, also warned that Tesla faces several other challenges. They include rising competition from established automakers and regulatory scrutiny surrounding overly optimistic public statements that CEO Elon Musk made last year regarding Model 3 production figures. “Tesla is contending with a litany of competitive, regulatory, human-resources, vehicle-quality and capital-structure issues,” the hedge fund manager said.

Tesla’s better-than-expected results and subsequent share price rally have seen some of the company’s other short sellers run for cover, according to Ihor Dusaniwsky. In a tweet from Nov. 5, the managing director at S3 Partners said short interest in the stock had declined by 940,000 shares over the last week and by 1.4 million shares since Oct. 1.

Nevertheless, the analyst pointed out that short interest in Tesla remains high at $11.16 billion and continues to attract inflows. That said, Dusaniwsky noted that bets against the stock don't tend to have much of an impact on the electric car maker’s share price.

“I am seeing a bit of short selling today, but in all honesty, shorts do not substantially move Tesla’s  stock price — it is long selling and buying that has the largest effect,” he tweeted. 

$TSLA short interest $11.16 bn, 32.22 mm shares, 25.05$ of float. #Tesla shares shorted declined by -940k over the last week, by -1.4 million shares since Oct 1st, and by -2.5 million shares since The Tweet. Shorts are down $1.88 billion in year-to-date mark-to-market losses pic.twitter.com/TMintwzbsf

— Ihor Dusaniwsky (@ihors3) November 5, 2018