Tesla sales slumped nearly 7% during the third quarter, the automaker confirmed Monday – although the news raises concerns about slumping demand, analysts cautioned not to take the rare downturn too seriously as the automaker could bounce back as it readies an assortment of new and updated models.
All told, Tesla said it delivered 435,059 battery-electric vehicles during the third quarter, down from 466,000 between July and the end of September. The automaker had previously posted record numbers, driven by both growing consumer interest in EVs and the sharp price cuts it had taken earlier in the year, according to various industry observers.
One of the questions being raised is whether CEO Elon Musk might follow with further price cuts to revive momentum. The automaker has already touched off something of a price war in the EV market. Ford, for one, trimmed the MSRP of its F-150 Lightning pickup by as much as $10,000 over the summer. Some other competitors, including Audi, Hyundai and Kia, have responded with short-term incentives.
When down is still up
Going into the final weeks of the third quarter, analysts following Tesla were expecting sales to increase about 34% year-over-year, according to a consensus forecast from FactSet. Still, the numbers were up 26% from a year earlier, the carmaker delivering 344,000 EVs during the same period in 2022.
Even with the third-quarter slump, Tesla maintained its forecast for the full year calling for it to deliver 1.8 million vehicles worldwide. While further price cuts might help, the automaker appears to be putting more weight on the product plan it is set to implement.
New product rollout begins
In China, it recently put production on hold as it began retooling for the launch of an upgraded Model 3 sedan. China has become a hotbed of competition in the EV space as more local manufacturers gain traction. Tesla aims to keep players like BYD and Great Wall from gaining traction.
It also plans to roll out the revised Model 3 — marking the nameplate’s first major update since it went on sale in July 2017 — in the U.S. and Europe.
At home, Tesla has been ramping up the production program at its Austin, Texas plant, with an increasing flow of Cybertruck pickups being spotted on car carriers heading out to dealers across the country.
After repeated delays, Musk set a goal of delivering the first of those EV pickups during the third quarter. While some have been spotted driving in California and other parts of the country it does not appear they were privately owned.
Requests for clarification sent to Tesla were ignored. The automaker no longer maintains a communications department.
Investors shrug it off
The third-quarter shortfall initially appeared to worry investors, shares briefly dipping by nearly 1% in early trading.
But TSLA shares quickly rebounded and, as noon approached on the Nasdaq exchange it had rebounded, rising to more than $252, a nearly 0.8% gain.