TechnologyTesla has been experiencing its first difficulties in 4 years, is this...

Tesla has been experiencing its first difficulties in 4 years, is this really worrying?

Model deliveries fell significantly in the first quarter, and the outlook is not very encouraging. The manufacturer is preparing to experience a few difficult months.

Tesla delivered 386,810 vehicles in the first quarter of 2024, down 20% from the fourth quarter of 2023 (484,507 vehicles), and 8% from the first quarter of last year — an annual decline which marks a first since 2020. The car manufacturer is therefore disappointing, and even more so given the expectations of Wall Street which had bet on almost 450,000 deliveries during the first three months of the year!

Brake on deliveries

The company had warned that growth would be “ significantly lower » in 2024, in particular due to high interest rates which limit the borrowing capacities of buyers. The Chinese market is always more competitive, and analysts do not rule out the “pushback” phenomenon of Elon Musk’s behavior and positions with certain customers.

Does this drop in deliveries sound the death knell for Tesla? Not so fast! The manufacturer faced headwinds in the first quarter, starting with an arson attack at its Berlin Gigafactory, forcing the factory to put production on hold for several weeks.

There have also been problems with the delivery of spare parts linked to armed attacks in the Red Sea. In the United States, the Gigafactory in Fremont, California, encountered difficulties in launching large-scale production of the new Model 3. A vehicle which, with the Model Y, represents 96% of deliveries during the quarter.

Read Test Model 3 (2024): the best electric sedan on the market gets even better

The situation has therefore not been kind to Tesla, especially since the results of the first quarter traditionally suffer when compared with those of the previous fourth quarter. More worrying, the group produced 46,561 units more than the volume of deliveries in the first quarter, which did not help matters: in addition to production concerns, Tesla could well have a demand problem on its hands and inventory management.

Last January, during the financial results, Elon Musk explained that the manufacturer was at the bottom of “ two major waves of growth »: the Model 3 and Y sales boom has now passed, and Tesla is now waiting for 2025 and the launch of its “cheap” model at less than €25,000.

Read Tesla Model 2: see you in 2025 for the cheapest Tesla?

This trough could be quite complicated to maneuver. Because at the same time, European manufacturers have finally woken up, and several models – like the electric Scénic – are riding proudly on Tesla’s lawns. What is Tesla’s real room for maneuver? Can the Californian manufacturer afford a lackluster second half or will it shake up the market again with a new price cut? The next few weeks will be crucial for Elon Musk’s firm, which will attract attention, and not just those of its shareholders.

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Daily Global Times
Daily Global Times
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