Tesla misses delivery target and puts shares under pressure

Tesla, Elon Musk’s electric-vehicle maker, missed expectations for third-quarter deliveries on Wednesday putting its annual delivery target, and its shares, under pressure.
The Texas-based company led by the billionaire, handed over 462,890 vehicles in the three months to September 30. The sales were an increase of 6.4 per cent from the preceding quarter, and the first quarterly increase of the year, suggesting demand is improving after the carmaker reduced its financing rates in the US.
The company also received a boost from China’s government increasing an incentive for consumers to trade in older cars for electric vehicles.
However, Wall Street on average had expected the company to deliver 469,828 vehicles, according to 12 analysts polled by LSEG. The shares were trading down $9.82, or 3.8 per cent, at $248.20 during afternoon trading in New York.
Tesla will need to deliver a record 516,344 vehicles in the fourth quarter to meet last year’s delivery figure of 1.81 million. If it fails to do so, Tesla risks recording its first annual drop in deliveries.
The carmaker has faced rising competition in the electric-vehicle market, including from Chinese brands such as BYD and Xpeng, which are trying to grow market share with help from local government subsidies.
In July, BMW led the European battery electric-vehicle market for the first time, beating Tesla, which has been losing market share to domestic firms, according to a report by Jato Dynamics. BMW’s growth in Europe has been boosted by sales of its BMW i4, a zero-emission executive car regarded as the German carmaker’s “Tesla-killer”, directly competing with the American company.
Tesla has been contending with slowing growth in demand for EVs as consumers worry about swapping their petrol-engined vehicles because of higher prices and unreliable charging infrastructure.
Traditional carmakers have been scaling back EV plans in favour of hybrids, which is a faster-growing market in America than EVs. Ford scrapped plans for an electric sports utility vehicle in August at a potential cost of up to $1.9 billion and said it would instead make a hybrid model.
Tesla is expected to unveil its robo-taxi product at a closely watched event on October 10 in Los Angeles as it attempts a shift in strategy, with a focus on AI-powered autonomous technologies.
Commenting on the event on X last week, Musk said: “This will be one for the history books”.
Tesla was founded in July 2003 by Martin Eberhard and Marc Tarpenning, two American engineers with an interest in global warming. The pair were inspired to create the company after General Motors recalled all its electric cars in 2003 and destroyed them, having decided that electric vehicles occupied an unprofitable market niche.
Musk, 53, was an early investor in Tesla before becoming a board member in 2004 and taking over as chief executive in 2008, the same year it launched the Roadster, its first electric car.
Musk also heads X, the social media platform formerly known as Twitter, which he bought in 2022 for $44 billion, as well as SpaceX, the rocket manufacturer, and Neuralink, a start-up vying to implant microchips in the human brain.
Analysts at Wedbush Securities said they “remain confident” in Tesla’s ability to hit 1.8 million deliveries by the end of the year. “Overall, this was a ‘mini step in the right direction’ for Tesla although more heavy lifting is clearly ahead for Musk & Co to turn around this delivery growth story,” they said in a note.