Elon Musk’s Tesla reported an 8.5 percent year-over-year decline in deliveries for the first quarter of 2024, marking the company’s first such drop since the pandemic-affected second quarter of 2020.
CNBC reports that on Tuesday, Tesla published its first-quarter vehicle production and delivery report, revealing that the company delivered 386,810 vehicles in the first three months of 2024. This figure fell short of analysts’ expectations, which ranged from 414,000 to 511,000 deliveries, according to a FactSet compilation of 11 estimates. The disappointing results sent Tesla’s shares tumbling by around seven percent in premarket hours and five percent in late-morning trading.
Elon Musk and Cybertruck (Ringo H.W. Chiu/AP)
The drop in deliveries was partially attributed to various challenges faced by the company during the quarter. These included the early phase of the production ramp of the updated Model 3 at Tesla’s Fremont factory in California and factory shutdowns. Houthi militia attacks on shippers in the Red Sea disrupted Tesla’s component supply and temporarily suspended production at its German factory outside of Berlin in January. Environmental activists also set fire to infrastructure near the German factory in March, causing a pause in production due to insufficient operating power.
In China, Tesla faced intense competition from domestic EV makers such as BYD and newcomers like phone maker Xiaomi. Sluggish sales numbers in January and February led the company to reduce production of its Model 3 and Model Y at its Shanghai plant and slash workers’ schedules.
The mixed reviews for Tesla’s newest model, the goofy Cybertruck, which began selling in small numbers in December last year, also contributed to the company’s challenges. Furthermore, a series of discounts and incentives appeared to be less effective in driving sales volume than in the past.
Despite the setbacks, Tesla CEO Elon Musk remains confident that customers and shareholders will stick with the brand and company regardless of his politics and incendiary rhetoric on social media platforms like X, which he owns.
However, a recent survey by market intelligence firm Caliber suggests that the ranks of would-be Tesla buyers in the United States are shrinking, partially due to Musk’s polarizing persona. Caliber’s “consideration score” for Tesla fell to 31 percent in February, less than half its high of 70 percent in November 2021. The survey also shows that 83 percent of Americans connect Musk with Tesla, indicating that his actions and reputation may be impacting the brand’s perception.
Several marketing, polling, and car experts spoke to Reuters, suggesting that controversies surrounding Musk’s increasingly conservative politics and public statements are weighing on Tesla’s brand and demand. Economic fears, the lack of affordable new models, and rising competition from cheaper rivals like China’s BYD have also been cited as factors putting pressure on Tesla.
Read more at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
