Analysts Predict Tesla Deliveries to Drop for Second Straight Quarter

by Michael Strong | July 1, 2024

Electric vehicle sales have been pretty steady as a group, but that’s in large measure due to Tesla, the segment leader, seeing sales drop since the start of the year. Analysts predict Tesla sales will drop at least 3% during Q2 while other EV makers are making gains.

Tesla’s Q2 deliveries are expected to drop nearly 4% globally and even more in the U.S.

The news is even worse in the U.S. where Cox Automotive analysts predict sales will fall 15.3% compared to the year ago period. The company reports its results Tuesday. The company did warn investors in January it expected delivery growth would be lower in 2024.

Tesla’s been selling vehicles at breakneck speed for so long, it almost seems like sacrilege to use “sales decline” and “Tesla” in the same sentence. However, the analysts’ consensus is the company will post it second straight down quarter — ever.

The EV maker is expected to deliver 438,019 vehicles for the quarter ended June 30, according to an average estimate based on forecasts from 12 analysts polled by LSEG. Seven of those analysts cut their expectations in the past three months, Reuters reported.

U.S. EV sales

The company’s delivery numbers are expected to drop, in part, because of a lack of inventory of lower-priced models.

The EV market is expect to capture about 7.5% of share during the quarter, which is about the same as Q1 this year. Many believe EV sales are falling or stagnating, but a closer look suggest that it’s Tesla’s numbers that are sliding while other automakers selling EVs are seeing gains.

For some observers that’s a tough sell as General Motors’ U.S. EV sales fell 21% in the first quarter. But Hyundai and Kia saw EVs sales jump 100% and 151% respectively. Other makers saw EV sales jump as well.

Cox isn’t the only one predicting a tough quarter, Barclays analyst Dan Levy expects an 11% drop in Q2 deliveries. If that happens, it’ll be the company’s biggest drop ever. He said, “a soft delivery result could turn attention back to the currently challenging fundamental environment for Tesla.”

Second half uptick

Many analysts believe the second half of the year will bring an increase to the market as Tesla competitors will have new EV models in dealer showrooms in large numbers, including the Chevrolet Equinox EV, Kia EV9, and more.

Some analysts have Aug. 8 marked on their calendar as Tesla is hosting its robotaxi day then.

However, the second half may be a good one for Tesla as well. Many analysts have Aug. 8 circled on their calendars. That’s the day Tesla’s robotaxis will be revealed.

“We believe the Aug. 8 robotaxi day will be a key historical moment for the Tesla story that we see as a near-term catalyst,” Wedbush Securities analyst Dan Ives wrote in a recent note. Ives is a Tesla bull.

“The rubber meets the road as the Street anticipates Aug. 8 as a key linchpin day for the Tesla story. While delivery numbers next week are very important the Street is starting to focus on the next growth driver at Tesla now forming with the worst of the demand doldrums in the rearview mirror.”