Tesla’s June-quarter deliveries likely fell 6%, the first time the top EV maker is set to post two straight quarters of decline, as it deals with stiff competition in China and slow demand due to a lack of affordable new models.
The company is expected to deliver 438,019 vehicles for the April to June period, according to an average estimate based on forecasts from 12 analysts polled by LSEG, seven of whom slashed their expectations in the past three months. The EV maker is expected to announce the results on Tuesday, reports Reuters.
Tesla has hit a speed bump after years of rapid growth that helped make it the world’s most valuable automaker. It warned in January that deliveries growth in 2024 would be “notably lower” as a boost from months-long price cuts wanes.
Adding to these problems is a consumer shift to cheaper gasoline-electric hybrid vehicles, which has left Tesla with a growing inventory of vehicles that it is trying to move with price cuts and incentives including cheaper financing options and leases.
Earlier this year, CEO Elon Musk shelved plans to make an all-new, cheaper electric car and shifted Tesla’s focus to robotaxis, a concern for some investors who fear that autonomous technology will be hard to perfect. Still, investors overwhelmingly voted in favor of his record $56 billion pay package at the annual shareholder meeting last month.
Barclays analyst Dan Levy predicted an 11% drop in second-quarter deliveries, Tesla’s biggest ever. He said “a soft delivery result could turn attention back to the currently challenging fundamental environment for Tesla”.
Tesla’s stock has lost a quarter of its value this year, making it one of the worst performers on the S&P 500, despite Musk’s forecast in April that Tesla would be able to increase sales this year. He has slashed costs including through mass layoffs that gutted Tesla’s supercharging team.
Tesla shares ended up 6.1% on Monday after Chinese automakers such as BYD posted strong second-quarter sales.
