Tesla delivered a record 405,278 vehicles in the quarter but missed its target

(Bloomberg) — Last quarter, Tesla Inc. delivered fewer cars than analysts had expected, falling short of estimates despite taking the unusual step of offering significant incentives in two of its largest markets.

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In the past three months, the company has delivered 405,278 vehicles to customers, less than the Bloomberg average of 420,760 vehicles. While the total was a quarterly record for Tesla, the company opened two new assembly plants last year and still fell short of its goal of increasing shipments by 50%.

After CEO Elon Musk predicted an “epic” end to the year, Tesla continued to cut car prices and manufacturing in China, and then offered $7,500 rebates in the US. Concerns about rising interest rates, inflation and other economic headwinds, as well as concerns about Musk’s antics on the Twitter he now owns, sent Tesla shares down 37% in December and 65% last year.

“We believe Tesla is facing a significant demand challenge,” Tony Sacconaghi, a sell-ranking stock analyst at Bernstein, wrote in a report Monday. “We believe Tesla will need to either lower its growth targets (and run its factories below capacity) or maintain and potentially increase the recent global price decline, putting pressure on margins.”

Read more: Tesla stock had its worst year ever. That doesn’t make it cheap.

Tesla increased shipments by 40% to 1.31 million last year, less than the 50% compound annual growth rate the company expects to achieve within a few years. Production increased by 47% to 1.37 million tons.

The company produced 439,701 vehicles in the fourth quarter, exceeding deliveries by 34,423 units. Tesla said it is continuing its transition to a “more even regional vehicle mix,” leading to another increase in the number of vehicles on the road at the end of the quarter.

“Tesla is selling cars and the auto industry is slowing down,” Gene Munster, managing partner at Loup Ventures, said by phone. “They are still struggling with logistics and the gap between production and supply has widened since last quarter.”

Tesla’s quarterly delivery figures are widely viewed as a barometer for EV demand overall, as the Austin, Texas-based company leads the way in battery-powered vehicles.

The company has a long tradition of doing its best at the end of each quarter to get cars in the hands of customers, with top executives like chief designer Franz von Holzhausen helping out at the southern California delivery center on New Year’s Eve.

Tesla doesn’t break down sales by region, but the US and China are its biggest markets, with 95% of sales in 2022 coming from the Model 3 sedan and Y crossover.

The company manufactures the S, X, 3, and Y models at its Fremont, California plant. Its Shanghai plant makes the Model 3 and Y, and in the first half of last year it began shipping Model Y from its newest factories in Austin and just outside Berlin.

While Musk handed over to PepsiCo Inc. the first Tesla Semi trucks in December, the company did not report deliveries of the model in its quarterly report. The automaker separately announced that an investor day is scheduled for March 1, where long-term expansion plans, a platform for next-generation vehicles, capital allocation and other topics will be discussed.

–With assistance from Craig Trudell.

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