Tesla’s lackluster sales performance in the first quarter of 2024 caught many analysts off guard and signals deeper problems for both Elon Musk’s electric car maker and the EV market as a whole.
of wall street journal report Tesla’s first-quarter 2024 car deliveries are shaping up to be a major disappointment, with the company potentially falling short of the 422,875 deliveries it delivered in the same period last year. This is Tesla’s first year-over-year sales decline since the pandemic-impacted second quarter of 2020. Tesla’s poor performance has made it the worst-performing stock in the S&P 500 so far this year.
Tesla still on fire in Connecticut (Stamford Fire Department)
Deliveries in the U.S. and China, Tesla’s two biggest markets, were down about 5% in the first few months of 2024 compared with a year ago, according to third-party data. Sales in Europe rose 41% in January and February from a year earlier, but the pace slowed from the end of 2023.
The disappointing sales were due to a slowdown in EV demand despite aggressive price cuts and stronger U.S. subsidies, as well as production slowdowns related to Fremont’s three model line renewals and an arson attack at the Berlin factory. This is thought to be due to a combination of various factors. Despite Joe Biden’s claims that electric vehicles are the future of the auto industry, demand for EVs is significantly weaker.
Analyst consensus estimates for Tesla’s first-quarter deliveries have declined in recent weeks, but are still significantly higher than what the data suggests. The FactSet consensus is 457,000, but more careful analysts on both the bullish and bearish sides have lowered their forecasts to the 406,000-414,000 range based on the latest available information.
The underdelivery suggests Tesla’s earnings forecasts are too high. This poses further challenges for Tesla, as repeated price cuts around the world are shrinking the company’s profits.
Some investors are excited about Tesla’s advances in self-driving software, but this remains difficult to quantify. After all, car sales are fundamental to Tesla’s growth story, including the potential for future software revenue. The more cars Tesla sells, the larger the target market for digital subscriptions will be in the future.
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Lucas Nolan is a reporter for Breitbart News covering free speech and online censorship issues.
