Tesla Q3 sales up 27% YoY, down sequentially due to factory timing

The Elon Musk-led company sold 435,059 vehicles in the third quarter of calendar year 2023, compared to 343,830 units sold in the corresponding period of 2022, according to data shared by FactSet Research on October 2.

Quarter-on-quarter, sales declined by nearly 7 percent, as they stood at 466,140 units in the April-June period. Analysts point to a slowdown in lubricants demand as well as the company’s scheduled factory upgrades.

The Texas-based automaker’s total production in Q3 came in at 430,488 units, which is slightly lower than the volume of vehicles sold in the same period.

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The company will need a major finish until 2023 to meet CEO Musk’s stated goal of increasing its sales by 50 percent annually. To reach that goal, Tesla will have to sell 1.97 million vehicles this year. Through the first nine months of the year, Tesla has delivered more than 1.3 million vehicles. Analysts expect Tesla to sell 1.84 million vehicles for the full year.

Tesla has been cutting prices more this year to continue attracting buyers who now have a wider selection of electric vehicles as more automakers move away from gasoline-powered cars and trucks. The rebates range from $4,400 on Tesla’s best-selling vehicles to $20,000 on its most expensive models.

Just how much the latest round of cost-cutting has eroded Tesla’s profit margins will be detailed Oct. 18 when it plans to release its third-quarter earnings.

Tesla shares fell 2.5% immediately after the opening bell on Monday. Despite the squeeze that has already occurred on Tesla’s profits, the company’s stock price has nearly doubled so far this year. Part of the move comes from an agreement to allow rivals General Motors and Ford to join its payments network.

Tesla could also be a direct beneficiary of the labor strike that began last month and continues to close factories operated by GM, Ford and Stellantis. The United Auto Workers union is demanding a huge wage increase that could raise the price of their cars and trucks — something Tesla isn’t facing with its non-union workers.

The UAW is also fighting for higher wages and union representation at factories that make batteries for electric cars, claims that U.S. auto companies oppose in a battle they say they need to win to remain competitive with Tesla and foreign companies.

(With AP inputs)

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Updated: 02 Oct 2023, 09:07 PM IST