Tesla, more deliveries but below Wall Street expectations: share price falls (-3.5%)

Tesla reported slightly lower than estimated deliveries in the third quarter. The Texas-based battery car maker delivered 462,890 vehicles in the three months to 30 September, an increase of 6.4 per cent compared to the previous period. This was the first plus sign this year after two consecutive quarters with a minus sign. But on average Wall Street expected the Elon Musk-led company to deliver 469,828 vehicles, according to a survey conducted by Lseg. Tesla is expected to deliver another 516,344 vehicles in the fourth quarter to reach last year's figure of 1.81 million units. Shares of the Texas-based manufacturer tumbled more than -5% in early intraday trade before retracing 3.5% at the close. Intense competition in the US, the lack of subsidies in Europe, particularly in Germany, and the economic slowdown in China weighed on demand. The market, therefore, is now very difficult even for those who have the absolute leadership in terms of capitalisation, close to USD 800 billion.

Intense competition in the US, the lack of subsidies in Europe, particularly in Germany, and the economic slowdown in China have weighed on demand. Clearly, the market is now very difficult even for those who have the absolute leadership in terms of capitalisation, exceeding USD 800 billion.

Looking at Europe, in July BMW led the continental battery electric vehicle (Bev) market for the first time, overtaking Tesla itself, which regained the lead in September, albeit with a -38% share of its best-selling model, the Model Y (the European EV market collapsed in August and September and will lose over 8% in 2024). Overall, Tesla fell in Europe from a 28% share in 2023 to less than 20%. The drop in sales, together with a policy of 'price war', has contributed to a reduction in profit margins.

Returning to the third quarter deliveries, 'expectations were for a 3,000-5,000 unit result,' commented Dan Ives, analyst at Wedbush, 'and that is why there is some pressure on the stock. Overall, however, we are looking at a clear improvement over the first half of the year. I think China showed relative strength this quarter, but it was offset by weakness in the US and Europe."

On 10 October, Tesla is expected to test the presentation of its robotaxis. It will be a crucial step for the future, because Musk has bet, at least from a timing point of view, more on the development of artificial intelligence and autonomous driving than on a new, cheaper model, whose launch has been postponed until 2025.