That’s a roughly 20% drop from the previous quarter and down more than 8% from the same time last year.
It’s the first time since 2020 that Tesla has seen a year-over-year drop in quarterly deliveries. Tesla shares were down more than 5% following the news and have plummeted nearly 30% over the past year.
“Let’s call this as it is: While we were anticipating a bad 1Q, this was an unmitigated disaster 1Q that is hard to explain away,” Wedbush Securities’ analyst Dan Ives wrote. “We view this as a seminal moment in the Tesla story for Musk to either turn this around and reverse the black eye 1Q performance. Otherwise, some darker days could clearly be ahead that could disrupt the long-term Tesla narrative.”
In a press release, Tesla attributed the drop in deliveries to its production ramp for its updated Model 3, an arson attack at its Gigafactory in Berlin, and supply chain issues stemming from the Red Sea conflict.
Ives, however, remains bullish on Tesla in the long term and maintains an outperform rating. He joined CNBC’s “Squawk on the Street” on Tuesday to talk about what it would take for Tesla to turn things around.
“You have to weigh out the strategy,” Ives said. “What are price cuts going to look like, when are the new models coming, what could software be as a percent of revenue, what’s the AI roadmap? Right now, it’s essentially playing darts blindfolded.”
Softening electric vehicle demand has contributed to lower EV sales for many automakers, including Tesla, which is also struggling to fend off competition in the Chinese market from BYD.
Tesla has repeatedly cut prices in an attempt to drive up sales, and Musk is now mandating Tesla employees give new customers test drive demos of its latest Full Self-Driving software, which car owners can buy as an add-on for $199 per month or $12,000.
In the US, Tesla is also losing potential customers over Musk’s polarizing behavior. In a recent report from market intelligence firm Caliber, the number of respondents who said they’d consider buying a Tesla fell to 31% in February, down from a high of 70% in November 2021.
