Wall Street worried about how many cars Tesla sold
Tesla Inc. may be headed for a gloomy milestone as waning demand for electric vehicles and elevated interest rates take a toll on sales.
Analysts rapidly lowered their projections for this week's deliveries report as the quarter came to a close. Some on Wall Street are braced for Tesla's first sales decline since early in the pandemic.
On average, analysts surveyed by Bloomberg estimate that Tesla delivered 453,964 vehicles in the quarter. That would be down more than six per cent from the company's record showing in the fourth quarter, which tends to be the best time of year for sales. The key will be delivering more cars than the 422,875 managed in the first three months of 2023 and avoiding a first year-over-year drop since the second quarter of 2020.
Elon Musk may not have helped matters in the final week of March.
The chief executive imposed a new directive that he acknowledged would slow the sales process, requiring that every customer in North America be taken for short drives to test out the driver-assistance feature Tesla misleadingly markets as “Full Self-Driving.”
Tesla started offering a free onemonth trial of the feature, which otherwise costs US$199 a month as a subscription or US$12,000 to purchase. This was one of several perks the company dangled to entice consumers, along with temporary US$1,000 discounts and free supercharging. Tesla also steppedup advertising on Google and X, the social media service Musk owns.
Musk warned investors in January that the company is “between two major growth waves.” The first was fuelled by the Model 3 sedan and Model Y sport utility vehicle, and the next is expected from the launch of a cheaper next-generation vehicle slated to start production late next year.
Tesla shares have slumped 29 per cent this year, the worst showing on the S&P 500 index.