Tesla’s Weak First-Quarter Deliveries An ‘Unmitigated Disaster’ For Musk

Tesla’s quarterly deliveries declined for the first time in nearly four years and fell short of Wall Street analysts’ estimates amid a challenging competitive landscape in the EV market and questions regarding the company’s direction.

The Elon Musk-led automaker’s stock declined by 4.9% during Tuesday’s trading session and slid a further 0.28% in after hours trading, with the stock down nearly 33% on the year. That followed Tesla’s announcement that it delivered roughly 387,000 vehicles in the first quarter – well below expectations of about 443,000 and an 8.5% decrease compared to the first quarter of last year.

“Let’s call this as it is: While we were anticipating a bad 1Q, this was an unmitigated disaster 1Q that is hard to explain away,” Dan Ives, managing director and equity analyst of Wedbush Securities, wrote in a note to investors.

He added that the firm remains “bullish on the long term story given the prospects for growth” but described the delivery figures as a “train wreck into a brick wall quarter” for Tesla.

Tesla faced an escalating price war in China, a key market for the EV maker, as low-cost competitors like BYD forced it to reduce prices and cut into its margins.

High interest rates in the U.S., a byproduct of the Federal Reserve’s fight against inflation, have also made it more expensive for American car buyers – a dynamic Tesla has sought to counteract with temporary discounts to entice customers.

Read full story at Fox Business.