Did a big Tesla price hike help the world’s biggest maker of only electric vehicles get back on track with sales and growth?
The short answer by the numbers appears to be: yes and no.
Tesla on Sunday reported that it delivered 422,875 vehicles over the first quarter of 2023. While that total was 4% higher than the previous quarter and 36% higher year-over-year, in weighing production and delivery numbers, there’s a concerning trend.
For the second quarter in a row, Tesla has produced significantly more vehicles than it has delivered to customers. And adding up the past four quarters, Tesla has built about 78,000 more vehicles than it’s sold, based on Tesla's quarterly disclosures.
This follows an across-the-board Tesla price cut of up to 20% made in January, and an additional Model S and Model X price cut of up to $10,000 in March. It’s quite an about-face from 2022, when Tesla made the last of several sudden price hikes of thousands of dollars each time.
2023 Tesla Model X - Courtesy of Tesla, Inc.
The recent price cuts have already led to some downward adjustment—or at least a pause on the markups—for the rest of the EV market. The Ford Mustang Mach-E, for instance, saw a price cut of up to $5,900 in January. And in February, market analysts suggested that the EV market will only get more competitive, with automakers needing to crank out as many profitable gasoline trucks as they can to afford EV development and carve out EV growth.
In 2022, Tesla deliveries grew 40% year-over-year, to 1.31 million vehicles, while production grew to 1.37 million.
Tesla has claimed, for years, that it’s looking for 50% year-over-year long-term growth, and in a January’s investor call looking at Q4 results, CEO Elon Musk suggested that the automaker might do better than that and deliver two million vehicles in 2023 (although its official guidance was at 1.8 million).
The numbers could be an indication of a weakening economy, stronger competition from other automakers, internal issues with Tesla getting cars out to customers, or all of the above. Look for more detail from Tesla later this month.