Tesla misses delivery estimates as weak economy overshadows price cuts

Tesla Inc. on Sunday missed estimates for first-quarter deliveries as a bleak financial outlook and rising competitors outweighed the electrical automaker’s efforts to prop up demand with worth cuts.

Tesla delivered 422,875 autos, a document excessive for the automaker however smaller than analyst expectations for 430,008 autos, based on Refinitiv knowledge.

Investors have been watching Chief Executive Elon Musk’s gamble that slicing costs would stimulate gross sales, making up for the revenue hit from eroding margins.

Tesla deliveries grew 4% from the earlier quarter and have been 36% larger than a yr in the past.

“Sequential growth continues even in the first quarter,” Martin Viecha, Tesla’s head of investor relations mentioned in a tweet.

The carmaker produced extra vehicles than it delivered, manufacturing 440,808 autos for the primary three months of this yr.

Tesla delivered 6% extra of its mainstay Model 3/Model Y autos than the earlier quarter. But the variety of deliveries for its higher-priced Model X/Model S autos slumped by 38%.

In January, Tesla slashed costs globally by as a lot as 20%, unleashing a worth battle after lacking Wall Street supply estimates for 2022.

Musk warned the prospect of recession and better rates of interest meant the carmaker may decrease costs to maintain development on the expense of revenue. In January, Musk mentioned the value cuts had stoked demand.

Shares have soared greater than 68% this yr on hopes that Tesla would win the value battle it began, though the inventory stays greater than 50% beneath its November 2021 peak.

(Reporting by Akash Sriram and Urvi Dugar in Bengaluru and Hyunjoo Jin in San Francsico; enhancing by Will Dunham, Lisa Shumaker and Bill Berkrot)