Wall Street's expectations were too optimistic, and Tesla's Q1 sales volume recorded the biggest drop in history

Zhitong Finance ·  Apr 3 11:27

Source: Zhitong Finance

As the first quarter nears its end, Wall Street analysts are$Tesla (TSLA.US)$Delivery volumes were predicted. Many analysts have lowered their expectations for vehicle deliveries, and Wall Street's expectations are still too optimistic as the data was released.

Tesla only delivered 38,6810 cars in the first three months of this year, which is the biggest gap from the average forecast over the past 7 years. Tesla's stock price fell 4.9% on Tuesday, extending its 2024 decline to 33%, ranking second among S&P 500 constituent stocks.

Tesla warned that the growth rate would “decline significantly” this year and blamed rising interest rates. Despite Tesla's sharp price cuts, many consumers are still unable to buy Tesla cars. The company dealt with multiple outages at its factory outside Berlin. Musk's statement on X has driven away potential buyers, and competition in the Chinese electric vehicle market has become more intense.

Despite these obvious downsides, most analysts still expect Tesla to sell more cars than a year ago. But the opposite was true, and its delivery volume ended up falling by 8.5%.

Gene Munster, managing partner at Deepwater Asset Management, said, “No matter what you say, the data is hard to read. Demand is weak. Interest rates are still high. Is Musk's image hurting Tesla's sales in the US? Its direction is negative.”

Tesla blamed part of the decline in sales on the shift to an upgraded Model 3 sedan, which and Model Y accounted for 96% of the quarter's deliveries. The company also mentioned shipping delays related to the Red Sea, as well as suspected arson attacks that caused the company's production in Germany to be lost for several days.

Despite this, Tesla produced 46561 more cars this quarter than delivered to customers, which is one of the biggest mismatches in the company's history.

Deutsche Bank analyst Emmanuel Rosner said, “In addition to known production bottlenecks, there may also be serious demand issues.” Rosner rated Tesla stock as a “buy.” More than two weeks before Tesla released the data, he lowered delivery expectations twice, but still overestimated Tesla's sales volume by more than 24,000 vehicles.

Tesla did not release quarterly car sales by region, but the US and China have long been its biggest markets. The company manufactures Model S, X, 3, and Y in Fremont, California, and Model 3 and Y in Shanghai. It also makes the Model Y at plants outside of Austin and Berlin.

At the end of last year, Musk also launched a Cybertruck with a stainless steel case. The company has yet to announce how many pickups it has produced and delivered, confusing them with data from other models, including the Model S and Model X. Compared to the past few quarters, Tesla's share of car rental deliveries is still low.

Despite many challenges, Tesla has taken back the title of the world's largest electric vehicle seller from China's BYD. In the first quarter of this year, BYD delivered 300,114 pure electric vehicles worldwide. Including plug-in hybrids, BYD sold a total of 626,263 vehicles.


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