Tesla stock declines over 5% on sharp fall in Q1 sales
Electric vehicle (Ev) maker Tesla Inc. stock declined more than 5 per cent on Tuesday on sharp fall in sales in March quarter.
Shares of the Elon Musk-led company were 5.3 per cent down at USD 165.98 at midday on Tuesday. The company lost about USD 30 billion in market value.
Austin-based Tesla said that it delivered 386,810 vehicles worldwide from January through March, almost 9 per cent below the 423,000 it sold in the same quarter of last year.
Tesla’s sales dropped as competition increased worldwide, global electric vehicle sales growth slowed, and price cuts failed to lure new buyers.
The company blamed the decline in part on phasing in an updated version of the Model 3 sedan at its Fremont, California, factory, plant shutdowns due to shipping diversions in the Red Sea, and an arson attack that knocked out power to its German factory.
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During the quarter, Tesla lost production time in Germany after a suspected arson attack cut its power supply.
Deliveries of the Models 3 and Y, dropped 10.3 per cent year-on-year to 369,783. Sales of other models, the aging X and S and the new Cybertruck, rose almost 60 per cent to 17,027.
Tesla produced 10.7 per cent more vehicles than it sold during the first quarter.
In January, the Ev maker had predicted “notably lower” sales growth this year.
Tesla is between two big growth waves, one from global expansion of the Models 3 and Y, and a second coming from the Model 2, a new, smaller and less expensive vehicle with an unknown release date, it had said.
Last year, Tesla had cut US prices by up to USD 20,000 for some models.
In March, it temporarily knocked USD 1,000 off the Model Y, its top-selling vehicle. Those price cuts narrowed the company’s profit margins.
Tesla’s sales numbers also dragged down shares of its US EV rivals. Rivian shares fell over 5 per cent, while Lucid dropped 4.4 per cent.
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Published: 02 Apr 2024, 10:59 PM IST
