Tesla's Delivery Dilemma: A Tough Quarter Ahead

Tesla's Delivery Dilemma: A Tough Quarter Ahead

As the second quarter of the year draws to a close, Tesla (TSLA) braces for another challenging period for electric vehicle deliveries. The automaker, which plays a pivotal role in the EV industry, is expected to see a drop in its delivery numbers.

A Rough Ride
The previous quarter was particularly tough for Tesla. The company delivered 386,810 vehicles, marking a 20% decrease quarter-over-quarter and an 8.5% drop year-over-year. This slump in Tesla's performance had a ripple effect on the entire EV sales, especially in the US.

Production Woes and Demand Issues
Tesla faced significant production challenges, including the ramp-up of the new Model 3 at the Fremont factory and shutdowns due to supply chain issues at Gigafactory Berlin. However, these production issues alone can't explain the entire 46,000-vehicle discrepancy between production and deliveries last quarter, hinting at potential demand issues.

Q2 Expectations: A Downward Trend
As Tesla wraps up its second quarter, all eyes are on the upcoming results. The Wall Street estimate consensus stands at 450,000 deliveries, down from the 466,000 vehicles Tesla delivered during the same period last year. However, as analysts adjust their expectations throughout the week, these estimates are expected to drop even further.

Regional Challenges: Europe and China
Europe seems to be a problem area for Tesla this year. According to registration trackers, Tesla is more than 60,000 deliveries off from its record year in 2023 so far in 2024, with most of the difference occurring over the last few months. On the other hand, China, Tesla’s most important market, shows promising signs thanks to strong new incentives like reduced interest rates.

The US Market: A Mixed Bag
Data is more opaque in the US. While Tesla has implemented incentives there, and the Model 3 Long Range recently gained access to the federal tax credit, it remains to be seen whether these measures will help close the gap.

As Tesla navigates through these challenges, the EV industry watches closely. The upcoming results will not only impact Tesla but could also set the tone for the entire EV market.



Source: Electrek