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Elon Musk’s American company started the year with more than 422,000 vehicles sold, an increase of 36%. But the brand is below expectations and continues to disappoint shareholders.
Should we see the glass as half empty or half full? On the one hand, the American company, a pioneer in the smart car market, delivered precisely 422,875 cars in the first quarter of 2023. An increase of 36% compared to 2022. However, Tesla has not managed to achieve its goals in the first quarter, says the American channel CNN.
Indeed, the company of Elon Musk reports a growth of only 4%. A figure lower than its annual objectives, set at 50% in the long term. As a result, its share price fell by 2% this morning, before the opening of the stock market.
The main problem encountered by Tesla is overproduction. The dealer produces more than it sells, even after a series of price cuts on its cheapest range.
Production exceeds demand
Unfortunately for the brand with the big T, the numbers speak for themselves. This is the fourth consecutive quarter that it has produced more than it has sold. A few days ago, Tesla said it had delivered 422,875 cars worldwide, compared to 430,000 expected. A difference of 78,000 vehicles, which is not negligible.
This discrepancy can be explained by several factors. First of all, the significant increase in production in the two new Tesla factories in Texas and Germany, which opened last spring. In January, the carmaker also announced its desire to expand its Nevada plant, investing more than $3 billion.
Second, Tesla said in one of its press releases that it had increased production of its most expensive models, which are popular in EMEA and the Asia-Pacific region. The problem? These expensive models are less easy to sell in quantity. Two important criteria, regardless of inflation, rising raw material and energy costs.
Huge demand
But looking at the details, not all the numbers are bad. Model 3 and Model Y are the two most sold and produced models. In fact, 421,371 units of both vehicles were produced and 412,180 delivered. And the reason? The prices are lower due to a significant drop in the sales price. They therefore represent almost all of Tesla’s factory production for the first quarter of 2023. With the risk of damaging its margins and therefore its finances?
“At the beginning of the year, we had a price adjustment. After that, we generated a huge demand, more than we could produce,” Tom Zhu, Tesla’s director of global production and sales, told CNN. According to him and his boss, “as long as you offer a product at an affordable price, you don’t have to worry about demand”.
An opinion that is not shared by all, including the shareholders of the firm. In 2022, Tesla (TSLA) shares fell 65%. But last Friday, they closed up 68%.
According to a financial analyst at Wedbush Securities (a private equity firm), while Wall Street has accepted a consensus of 421,500 vehicle sales, Tesla will have to settle for more adjusted profit margins going forward.
The automaker will report its first quarter financial results in a few days, on April 19.
Read also >Tesla to invest billions to expand its Nevada factory
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Elon Musk’s American company started the year with more than 422,000 vehicles sold, an increase of 36%. But the brand is below expectations and continues to disappoint shareholders.
Should we see the glass as half empty or half full? On the one hand, the American company, a pioneer in the smart car market, delivered precisely 422,875 cars in the first quarter of 2023. An increase of 36% compared to 2022. However, Tesla has not managed to achieve its goals in the first quarter, says the American channel CNN.
Indeed, the company of Elon Musk reports a growth of only 4%. A figure lower than its annual objectives, set at 50% in the long term. As a result, its share price fell by 2% this morning, before the opening of the stock market.
The main problem encountered by Tesla is overproduction. The dealer produces more than it sells, even after a series of price cuts on its cheapest range.
Production exceeds demand
Unfortunately for the brand with the big T, the numbers speak for themselves. This is the fourth consecutive quarter that it has produced more than it has sold. A few days ago, Tesla said it had delivered 422,875 cars worldwide, compared to 430,000 expected. A difference of 78,000 vehicles, which is not negligible.
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Elon Musk’s American company started the year with more than 422,000 vehicles sold, an increase of 36%. But the brand is below expectations and continues to disappoint shareholders.
Should we see the glass as half empty or half full? On the one hand, the American company, a pioneer in the smart car market, delivered precisely 422,875 cars in the first quarter of 2023. An increase of 36% compared to 2022. However, Tesla has not managed to achieve its goals in the first quarter, says the American channel CNN.
Indeed, the company of Elon Musk reports a growth of only 4%. A figure lower than its annual objectives, set at 50% in the long term. As a result, its share price fell by 2% this morning, before the opening of the stock market.
The main problem encountered by Tesla is overproduction. The dealer produces more than it sells, even after a series of price cuts on its cheapest range.
Production exceeds demand
Unfortunately for the brand with the big T, the numbers speak for themselves. This is the fourth consecutive quarter that it has produced more than it has sold. A few days ago, Tesla said it had delivered 422,875 cars worldwide, compared to 430,000 expected. A difference of 78,000 vehicles, which is not negligible.
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