The sales decline led to a 5.2% decrease in Tesla’s stock price on Tuesday|Ray|CC BY-ND 2.0
Tesla faced a challenging start to the year as its quarterly deliveries dropped for the first time in four years, falling short of Wall Street’s expectations.
During the first quarter of 2024, the EV giant produced 412,376 vehicles and delivered 387,000 to customers, marking an 8.5% drop compared to a year earlier.
Most of the vehicles delivered were Model 3 and Model Y cars.
Analysts who predicted 457,000 deliveries described the figures as “an unmitigated disaster.” They suggest competition in its biggest buyer China, where local players like BYD and Xiaomi are gaining traction, could be impacting Tesla’s performance.
Tesla attributed the decrease to
- Production setbacks to its next version Model 3 sedan.
- Shipping disruptions caused by the conflicts in the Red Sea.
- And a factory arson attack in Berlin.
The sales decline led to a 5.2% decrease in Tesla’s stock price on Tuesday, resulting in a loss of approximately $30 billion in market value.
The downward trend compounds Tesla’s woes, positioning it as the second-worst performer in the S&P 500 index.
The EV maker faces other challenges, including soft demand for EVs, high federal interest rates and ongoing issues, including lawsuits and investigations related to its EV Autopilot system.
Controversies surrounding CEO Elon Musk, like making statements leading to accusations of antisemitism and support of white pride and transphobia, have also impacted the company’s image.