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Tesla has lamented damaging world events and internal pressures as factors responsible for its smallest delivery of cars to customers since 2022.?
The electric vehicle (EV) giant experienced a sales slide in the first quarter of 2024. Just under 387,000 cars were shipped, representing an 8% year-on-year drop after 484,507 EVs were dispatched in the final quarter of 2023.
Based on these results, the company’s share price fell more than 5%.
Production has also hit a downturn, but the change has also been impacted by events outside the control of the Austin-based automotive multinational.
Tesla had already acknowledged the switch to production of the new Model 3 would change its numbers. Still, an alleged arson attack on its factory in Germany was an unwanted setback, further exacerbated by supply disruption in the Red Sea due to attacks by Houthi rebels.
Tesla and EV Competitors
Against this backdrop, the company has cut prices in line with rival competitor BYD, the biggest-selling EV maker in China. Moreover, it has to contend with the arrival of Xiaomi into an already crowded market.
Last week, the Chinese smartphone brand made a high-profile launch of its first EV, the flagship SU7,? boasting tens of thousands of orders in less than an hour.
The SU7’s attractive pricing is likely to pique consumer interest. It beats the starting price of Tesla’s introductory Model in China, at 245,900 yuan ($34,603). The company has claimed its car beats the Model 3 in most of its specifications, except in a few aspects that could take up to five years to match Elon Musk’s organization.
Analysts on Tesla’s Q1 Report
Wedbush Securities analyst Dan Ives described the headline Tesla update as an “unmitigated disaster, that is hard to explain away”.
He continued, “This is a fork in the road; time to get Tesla through this turbulent period; otherwise, troubling days could be ahead.”
Pressure and scrutiny will now fall on Musk, who will likely meet criticism in his usual forthright, bullish manner. He will need to steer the company to calmer waters when he is making plenty of headlines for his activity with X, the social media platform.
Tesla needs to ensure it remains on course to meet the challenges ahead at the cutting edge of the evolving EV market. It will strive to position the new Model 3 as the next big innovation.
