Why Record Tesla Deliveries Were A Flop

Tesla announced its record fourth-quarter deliveries, although the figure fell short of analysts' forecasts due to the company's inability to meet its target for a year-over-year increase in vehicle deliveries.

Tesla announced on Thursday that it manufactured 459,445 vehicles in fourth quarter and shipped 495,570 units worldwide. The company also installed 11 gigawatt-hours of energy storage products for the quarter. In total for the year, Tesla's energy storage deployments reached 31.4 gigawatt hours. In terms of vehicles alone, Tesla delivered 1.789 million vehicles while producing 1.773 million units last year.

Tesla reported that it anticipates "little" growth in vehicle deliveries in 2024, following a significant 38% increase in 2023 to 1.81 million vehicles delivered. Noting sluggish sales in the U.S. and Europe, the company has been exploring ways to boost demand by offering various discounts and incentives to customers. While China experienced a surge in demand in the fourth quarter, the U.S. and European markets have seen a weaker performance.

Check out the video at Investors.com to find out if Elon Musk's high-risk bets on artificial intelligence and Trump's presidency will pay off for Tesla in 2025.

To surpass 1.81 million deliveries in 2024, Tesla must achieve 514,925 deliveries in the fourth quarter, a significant increase from the previous quarterly record of 484,507 set in 2023. Analysts had previously forecasted a quarterly total of approximately 498,000 vehicles and 1.79 million deliveries for the year, based on information from FactSet. Some other estimates also predicted a fourth quarter total of around 506,000 units.

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"Tesla's ailing stock reflects a product that's overdue for an update, and the growing number of affordable alternatives available worldwide are pressuring prices ahead of the expected release of a new lower-cost model, the Juniper, as early as mid-2025, which will likely outweigh the benefits of pre-hype buying and promotional efforts," said Morgan Stanley analyst Adam Jonas, a well-respected Tesla bull.

Tesla Stock Performance

Tesla's stock price fell 6% to $379.28 during trading on Thursday.

The new dual-motor Tesla Cybertruck is now eligible for the $7,500 tax credit, which will likely increase demand at least through the start of 2025.

Tesla stock dropped 3.25% to $403.84 on Tuesday, marking a fourth straight decline and its first close below the 21-day moving average since October 24th. The stock has been holding steady since hitting a peak of $488.54 on December 18.

Tesla's stock jumped up 62.5%, almost all of it in the fourth quarter, following the news of Donald Trump's election as the next US president.

Tesla stock is on the Investors' Business Daily (IBD) market watchlist.

Tesla leads the IBD Auto Manufacturers industry group, which consists of 35 members. The company's stock boasts a 90 out of a maximum 99 IBD Composite Rating. Additionally, Tesla's shares possess a 96 Relative Strength Rating and an EPS Rating of 78.

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