Cybertruck arrived more significantly in 2024, but slow growth was one of the factors behind the drop in annual sales (Brandon Bell)
By AFP - Agence France Presse
Tesla reports lower car deliveries in 2024, missing forecast
John BIERS
Tesla reported a drop in full-year car sales on Thursday, missing a company forecast, in a sign of growing competition from electric vehicles in China and other markets.
Elon Musk's electric vehicle company recorded 495,570 deliveries in the fourth quarter. Although this represented a quarterly record, it fell short of Wall Street estimates and resulted in full-year sales of just under 1.8 million vehicles.
This was about one percent lower than 2023 sales, even though Tesla said in October that it expected “slight growth” in vehicle deliveries for the year.
In addition to increased competition from producers such as China's BYD and traditional car companies, analysts pointed to a slow increase in production of the futuristic Cybertruck.
Tesla's shares fell sharply after the announcement, reducing the company's huge gains since the November 5 presidential election in the US.
The sales figure caps a mixed 2024 for Tesla, a year in which Musk plunged headlong into US electoral politics.
He helped deliver the presidency to Republican Donald Trump through massive contributions and the amplification of Trump's anti-immigration and other rhetoric on Musk's X platform, the former Twitter.
But Tesla's profits in the first three quarters of 2024 fell 31% compared to the equivalent period in 2023, a reflection of measures to reduce prices in the wake of slowing demand.
Tesla called the current period of subdued sales a reflection of its position “between two major waves of growth,” with the next period of volume increases due to advances in autonomy and the introduction of new vehicle products.
The company has faced pressure to launch new vehicles, with Wall Street particularly eager to see a lower-priced model. Currently, the Model 3 costs around US$30,000.
Investors applauded a statement by Musk in July that he plans a new, more affordable model in the first half of 2025, but the company provided few details.
CFRA Research analyst Garrett Nelson pointed to lukewarm deliveries of the Cybertruck, which customers began receiving in November 2023.
Tesla's press release on Thursday did not detail sales of the vehicle, which was a component of “other models.” Deliveries in that category stood at just 85,133 for the year.
Musk has previously described the Cybertruck's challenges as production-related, characterizing demand as robust. He said he expects annual sales of 250,000 Cybertrucks in North America.
But current production appears to be well below Cybertruck's current installed capacity of over 125,000 per year, according to Tesla literature.
“Acceleration has been disappointing,” said Nelson, adding that the figures raise doubts about demand for the vehicle.
Although not yet common on US roads, the massive and brutal-looking Cybertruck has become perhaps Tesla's most iconic vehicle, generating both adoration from Tesla fans and derision from critics on social media.
Authorities were investigating the explosion of a Cybertruck on Wednesday outside the Trump Hotel in Las Vegas, which killed one person.
- Autonomous drive
Tesla shares rose more than 60% between Trump's election as president on November 5 and the end of 2024, with the market certain that Musk's influence in the new government will benefit Tesla's initiatives in autonomous driving and artificial intelligence.
“The next step in this broader Tesla strategic vision begins with the autonomous and AI era, which will be accelerated under a Trump White House,” said Wedbush analysts, who considered Tesla's car sales in 2024 a secondary issue compared to Tesla's growth story.
Tesla skeptics point to progress on the ground by Alphabet-owned Waymo, which currently operates robotaxis in three US cities. A much-praised launch event in October in Los Angeles showcasing Tesla's autonomous robotaxi vehicles received lukewarm reviews.
But Tesla experts point to the company's progress in driver assistance technologies, which is providing the company with data that it believes will ultimately lead to full autonomy.
“We're still buying the stock,” said Nelson, who also predicts a recovery in sales next year. “2025 will be a year in which there will be significant progress in the development of the autonomous driving framework. So that's positive for the stock.”
Tesla shares fell 6.9% in early afternoon trading.
jmb/dw
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