After setting a record for deliveries in the previous quarter, Tesla reported downtime at its factories caused a downshift in production in the third quarter.
Tesla (TSLA) said it delivered 435,059 vehicles worldwide in the third quarter, in line with analysts’ expectations, but lower due to factory downtime and weaker demand. Tesla shares were down about 1.8% in early trading Monday.
KEY TAKEAWAYS
Tesla delivered 435,059 electric vehicles in the third quarter, lower than analyst estimates.
The number was lower than in the second quarter as its Shanghai and Austin gigafactories experienced some downtime as they were being upgraded.
Wedbush expects a strong fourth quarter, while Deutsche Bank cut its price target.
The Austin, Texas-based automaker said its deliveries of electric vehicles in the third quarter were down from 466,140 in the previous quarter. Analysts had expected the figure to be around 455,000. Production for the quarter was also lower at 430,488 versus 479,700 in the second quarter.
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Tesla Quarterly Deliveries
In Tesla’s second-quarter analyst call, Elon Musk said that production was expected to be lower this time around due to shutdowns at plants in Texas and China.
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The automaker’s plants are being upgraded in preparation for the redesigned Model 3 sedan and the Cybertruck. The company reiterated that its year-end target of delivering 1.8 million vehicles by the end of the year has not changed.
Some analysts believe the retooling could help the company to a stronger fourth quarter performance. Ahead of the release, Wedbush analysts said Tesla was on course to deliver around 460,000-465,00 units, but the extended downtime shifted around 20,000 deliveries to the fourth quarter.
While they were disappointed by the numbers released, they maintained their outperform rating for the stock in a note Monday.
“Even when factoring in the shutdowns with no rose-colored glasses, Tesla clearly missed Street estimates this quarter with bulls left disappointed, although we see better days ahead for 4Q and 2024,” said Wedbush analysts.
Others are not convinced about Tesla’s outlook with Deutsche Bank downgrading its stock price target on the company last week, citing downside risk to earnings.
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Tesla suffered a 9.6% year-over-year drop in operating margins for the second quarter due to a price-cut strategy that launched in January.
