- Tesla deliveries fell 20.2 percent compared to the last financial quarter
- Wedbush analyst described Quarter as “a train wreck against a brick wall” for Musk
Tesla sales fell 7 percent this morning after the electric vehicle maker reported its biggest ever decline in deliveries.
The world’s most valuable automaker delivered 386,810 vehicles in January, February and March, down 20.2 percent from the previous quarter.
Wall Street, on average, expected Tesla to deliver about 460,000 vehicles, but some analysts began lowering their expectations to the low 400,000s in recent weeks.
“While we expected a poor first quarter, this was an unmitigated first-quarter disaster that is difficult to explain away,” Wedbush analyst Dan Ives said in a research note on Tuesday.
“For Musk, this was a train wreck against a brick wall,” he added.
Tesla sales fell 7 percent this morning after the electric vehicle maker reported its first drop in deliveries since the pandemic. In the photo: CEO Elon Musk
Deliveries were significantly lower than Wall Street expected as the company faced increasing competition in China and declining demand for electric vehicles in the US.
More bad news for Tesla, whose stock price has taken a big hit this year. The latest plunge has sent shares down 33 percent since the start of the year – the biggest decline of any S&P 500 company.
Quarterly deliveries are an important measure of Tesla’s health and can be viewed by investors as a proxy for revenue.
It also reported on Tuesday that it produced a total of 433,391 cars during the quarter. The Model 3 and Y make up the vast majority of sales and deliveries.
The automaker produced 412,376 Model 3/Y cars and delivered 369,783.
Musk has previously hinted at a period of poor sales, saying the company is “between two big waves of growth.”
He claimed that the first wave was caused by the introduction of affordable models such as the Model 3, which launched in 2017, and later the Model Y, which launched in 2022. The two vehicles are among the best-selling electric vehicles in the world.
The next wave will come when the company launches its next-generation affordable electric car. It is expected that it will not go into production until next year.
On average, Wall Street expected Tesla to deliver about 460,000 vehicles, so Tesla fell short by more than 15 percent
“We view this as a pivotal moment in the Tesla story for Musk to turn this around and reverse the Black Eye performance in the first quarter,” Ives said. “Otherwise, there could clearly be dark days ahead that could disrupt the Tesla story in the long run.”
He predicted Chinese deliveries would fall 3 percent year-on-year.
Chinese automaker BYD has emerged as an increasing threat to Musk, overtaking Tesla in deliveries in the fourth quarter of last year.
Other setbacks in the first quarter included the closure of the factory near Berlin, Germany, due to a fire, and the slowdown of production at a factory in California as it switched to producing an upgraded Model 3.