The first quarter of 2024 went much worse for Tesla than anyone could have imagined.
The Elon Musk-fronted EV maker announced a shocking drop in quarterly sales on Tuesday, according to The New York Times. The company said it delivered 383,000 vehicles globally through the first three months of the year, which is 8.5 percent less than it moved in the same period last year.
The delivery figure, which is the closest thing we have to sales data for Tesla, caught both industry analysts and investors off guard. Not only did the number of deliveries decrease by 36,000 vehicles—something that happened since the first months of the pandemic—but it was 74,000 short of the 457,000 vehicles Wall Street expected the company to deliver last quarter, according to CNBC, and Tesla also had the first year-over-year drop since 2020. If that wasn’t bad enough, some of the company’s biggest rivals, including China-based BYD and South Korea-based Hyundai and Kia, have seen EV sales increase during the first part of the year.
Tesla Cybertruck
Tesla
Tuesday’s announcement comes during a time of industry-wide unease about the viability of EVs. Over the last few months, we’ve seen a number of legacy automakers, like General Motors and Mercedes-Benz, pump the brakes on their electrification strategies. Tesla also seems to be struggling to expand its reach past the early adopters that helped the company create the EV market in the first place.
While there is no one clear answer for Tesla’s struggles, several factors appear to be contributing to the downturn. Tesla has proven it can make practical EVs, but a truly affordable model remains years off. Its unorthodox exterior and interior designs (which are all but devoid of buttons) also have put some drivers off. The company still doesn’t have the service infrastructure to compete with more established automakers.
Tesla’s very vocal leader, Musk, may not be helping matters either. A study by market intelligence firm Caliber showed that the executive’s “polarizing persona” has begun to turn off would-be buyers, according to Reuters. Musk, who also acts as the company’s one-man marketing and public relations department, has yet to address the disappointing delivery figures, but he did spend the day crowing about the death of “legacy media,” reposting voting conspiracies, and criticizing Disney for being too “woke.”
For its part, Tesla says the decrease in deliveries has more to do with supply chain, delivery, and production issues. The company blamed a chips shortage at its German factory, continued attacks on ships in the Red Sea, and the introduction of a refreshed Model 3 in the U.S. for its unexpectedly poor first-quarter performance.
Unsurprisingly, Tesla share prices fell nearly five percent on the back of Tuesday’s announcement, according to Bloomberg. This isn’t the first time the company’s stock has struggled in 2024. The EV giant’s stock price has fallen by 33 percent for the year, making it the worst performer in the Nasdaq 100 Index and the second-worst in the S&P 500.
