Tesla delivered more than 422.8 thousand cars, which is a record for the company, but less than analysts' expectations of more than 430 thousand cars.

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Edited by |Adam Lurkade

economic section

5 April 2023- AUSTIN (United States) 

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   Tesla failed to meet its expected deliveries in the first quarter of 2023, as a bleak outlook for the economy and increased competition affected the electric vehicle maker's efforts to support demand by cutting prices.

Tesla deliveries rose 36 percent compared to last year but remained below the 52 percent growth rate sought by CEO and founder Elon Musk this year. Tesla delivered more than 422.8 thousand cars, a record for the company, but less than analysts' expectations at more than 430,000 vehicles, according to Refinitiv data.

Musk, who has missed his ambitious sales targets for Tesla in recent years, said last January that "2023 sales could reach 2 million cars, in the absence of external disruption, from 1.3 million in 2022."

The production of the largest manufacturer of clean vehicles exceeded the number of cars it sold, as it made more than 440.8 thousand cars during the first three months of this year.

The company increased the volume of its production in two factories that it opened recently in Texas and Berlin, with the recovery of Chinese production from the closure measures that were taken with the aim of cordoning off the Corona epidemic.

Investors were awaiting the outcome of Musk's risk, who said that "cutting prices would stimulate sales and compensate for the damage caused by the erosion of profit margins."

The company cut prices globally by as much as 20 percent, setting off a price war after it missed Wall Street's delivery estimates for 2022.

For example, the base Model Y, which sold for $65.9 thousand, is now on the market at a price of just $55,000, while the Model S starts at $89.9 thousand and the Model X at $100,000.

“If they hadn't done the price cuts, it would have been ugly,” said Gene Munster, managing partner at Deepwater Asset Management. I think what it tells you is that the economy is getting tougher.” "They showed acceleration, but they did not accelerate to the level that Musk suggested," he added.

In light of the recent results, some analysts expect that Tesla will have to cut prices again in conjunction with other manufacturers reducing prices and continuing concerns about the deteriorating economic situation.

Tesla's announcement to reduce the prices of its cars in China caused competition to intensify with a number of Chinese companies, including BYD and Xping, which announced price cuts to maintain their market share amid weak demand.

Leading BYD accounted for 41 percent of electric car sales in the world's largest auto market during the first two months of this year, while Tesla was only able to seize an eight percent share.

In a note to investors, Jefferies analyst Philippe Hoshua wrote that Tesla's "overproduction over-delivery" will keep the debate going over whether there is weakness in demand or whether price cuts will lead to increased demand.

During Tesla's Investor Day in early March, Musk acknowledged that affordability was still a drag on sales, but said many people still wanted to buy the company's cars. "The determining factor is their ability to pay for it," he emphasized.

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