Elon Musk, the CEO of Tesla and SpaceX, has seen a fall in Tesla shares after the company reported a decrease in vehicle deliveries for the first quarter – the first such decline since 2020 when global pandemic had disrupted production.
Key data points revealed are:
– Total deliveries for Q1 2024 were 386,810.
– Total production for the same period was 433,371.
The production of vehicles fell by approximately 1.7% from the previous year and 12.5% sequentially for Tesla. This wasn’t as steep as the 8.5% annual drop in deliveries.
It reported that it produced 412,376 Model 3/Y cars and delivered 369,783. It made 20,995 of its other models and managed to deliver only 17,027.
Last year, during the same time-frame, the electric car manufacturer reported 422,875 deliveries and production of 440,808 vehicles. In the fourth quarter of 2023, Tesla reported 484,507 deliveries and production of 494,989 vehicles.
Deliveries reported by Tesla are the company’s closest approximation of sales, but not precisely defined in the company’s shareholder communications.
Analyst expectations fell significantly short for Tesla’s deliveries in the quarter. The mean of 11 estimates compiled by FactSet showed analysts predicted around 457,000 deliveries for the period ending March 31.
Several challenges were faced by Tesla in the first quarter. Attacks by Houthi militia disrupted Tesla’s component supply and temporarily suspended production at its German factory outside of Berlin in January. In March, environmental activists set fire to infrastructure near the same factory, causing a pause in production.
Tesla faced increased competition in China from domestic EV makers, including BYD and newcomers such as phone maker Xiaomi. Persistent sluggish sales numbers for its China-made cars resulted in the company reducing production of its Model 3 and Model Y at its Shanghai plant and slashing workers’ schedules.
In the US, Tesla’s newest model, the Cybertruck, received mixed reviews leading to less sales volume. Tesla’s shares plummeted 29% in the first quarter, marking the biggest decline since the end of 2022 and the third-steepest quarterly plunge since the company’s IPO in 2010.
Tesla has scheduled an earnings call for April 23 to discuss quarterly results.
Shares of Tesla fell following the company’s report of a decline in vehicle deliveries for the first quarter of 2024, with a total of 386,810 vehicles delivered and 433,371 produced. This represents the first annual decline since 2020, with production down 1.7% from the previous year and 12.5% sequentially. The company cited challenges such as Houthi militia attacks disrupting component supply and environmental activists causing temporary production halts at its German factory.
Further, in China, Tesla faced strong competition from domestic EV makers, including BYD and Xiaomi, and reduced production of its Model 3 and Model Y at its Shanghai plant. In the U.S., the company’s newest model, the Cybertruck, received mixed reviews.
It is also reported that a series of discounts and incentives were less effective in driving sales volumes than in the past. Prospective Tesla customers in the U.S. were fewer in the first quarter of 2024, partly due to CEO Elon Musk’s controversial persona.
Tesla’s shares dropped 29% in the first quarter, the biggest decline since the end of 2022 and the third-steepest quarterly plunge since the company’s IPO in 2010. Tesla stock closed down about 5% on Tuesday at $166.63 per share. The company has scheduled an earnings call for April 23 to discuss quarterly results.
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