Tesla has sluggish start to the year with first annual sales decline since
Tesla posted its first annual sales drop in more than a dozen years on Thursday, sinking a stock that has soared since Donald Trump’s victory on optimism that CEO Elon Musk’s close relationship with the president-elect will help the company.
Tesla’s global vehicle sales rose 2.3 per cent in the final quarter thanks to zero per cent financing, free charging and low-priced leases. But that was not enough for billionaire Musk’s most valuable holding to overcome a sluggish start to 2024.
The company, based in Austin, Texas, sold 495,570 vehicles from October through December, boosting deliveries to 1.79 million for the full year. But that was 1.1 per cent below 2023 sales of 1.81 million, as overall demand for electric vehicles in the United States and elsewhere slowed.
The year-over-year global sales drop is Tesla’s first since 2011, according to figures from analytics firm Global Data. The company sold 1,306 vehicles in 2010, but that dropped slightly to 1,129 the following year.
The fourth-quarter boost came with a cost. Analysts polled by data provider FactSet expected Tesla’s average sales price to fall to just over $41,000 US in the quarter, the lowest in at least four years. That doesn’t bode well for Tesla’s fourth-quarter earnings, which the company said it would announce on Jan. 29. Tesla’s stock fell more than seven per cent on Thursday.
Musk donated more than $250 million to Trump’s re-election campaign and is a regular guest at the president-elect’s Mar-a-Lago resort in Florida.
Tesla investors have pushed the stock up more than 50 per cent since November’s election on hopes the new administration will streamline electric vehicle regulations and address other Musk policy priorities.
More competition, aging models
In 2022, Tesla predicted that its sales would grow by 50 per cent most years, but the prediction ran into an aging model lineup and increased competition in China, Europe and the U.S.
In the U.S., analysts say most early adopters of technology already have electric vehicles, and more mainstream buyers have concerns about range, price and the ability to find charging stations on longer trips.
The fourth-quarter deliveries fell short of Wall Street estimates. Analysts polled by FactSet expected sales of 498,000 vehicles.
The company made headlines this week when a Cybertruck — one of its signature models — caught fire and exploded outside of a Trump hotel in Las Vegas. Firework mortars and camp fuel canisters were found stuffed into the back of the vehicle, according to law enforcement, and Musk said in a post on X, formerly Twitter, that the explosion was unrelated to the Cybertruck itself.
One person died and seven others were injured on Wednesday when a Tesla Cybertruck that appeared to be carrying fireworks caught fire and exploded outside a Trump hotel in Las…
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