Tesla Tumble Reignites After Disappointing Deliveries

Short-sellers in the world’s largest EV maker continue to do well as 2023 starts with Tesla down 10% after missing expectations on new vehicle deliveries (despite actually delivering a record number).

In a press release put out midday on Monday, Tesla announced it had delivered a record 405,278 vehicles for the Q4 2022 quarter.

The number marks a record for the company, but comes in below most Wall Street estimates, even some that were revised lower. Consensus estimates for deliveries stood at 420,760 into the report, according to Bloomberg.

“In 2022, vehicle deliveries grew 40% YoY to 1.31 million,” the company’s press release says.

This falls short of the 50% growth figure the company had once projected for the year. 

Tesla commented:

“We continued to transition towards a more even regional mix of vehicle builds which again led to a further increase in cars in transit at the end of the quarter. Thank you to all of our customers, employees, suppliers, shareholders and supporters who helped us achieve a great 2022 in light of significant COVID and supply chain related challenges throughout the year.”

It’s also the third straight quarter that deliveries have missed estimates.

TSLA shares are down 10%, erasing most of the gains from last week following Musk’s commitment to ‘no more sales’ until 2025…

Bloomberg reports that while Tesla stock just had its worst month, and its worst year, since its 2010 initial public offering, the stock is still not cheap.

It’s still worth more than its big rivals combined and has a higher valuation than most big tech companies.

The short-term outlook has been pressured by the surging cost of raw materials used in batteries, competition and Elon Musk’s distraction by the Twitter takeover.

“We believe that Tesla is facing a significant demand problem,” Toni Sacconaghi, a Bernstein analyst who also has the equivalent of a sell rating on the stock, wrote in a report Monday.

“We believe Tesla will need to either reduce its growth targets (and run its factories below capacity) or sustain and potentially increase recent price cuts globally, pressuring margins.”

Additionally, Bloomberg reported this weekend that Model 3 sedan and Model Y sport utility vehicle buyers will continue to get 10,000 yuan in incentives (about $1,450) if they take delivery by February 28, 2023, per Tesla’s website.