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Tesla Sales Fall 31% in Q1, Stock Follows

Shares of Tesla Inc. fell by 9% following an underwhelming first-quarter sales report, but executives say they have the demand and capital they need to meet their 2019 production goals.

Tariq Kamal
Tariq KamalFormer Associate Publisher
Read Tariq's Posts
April 4, 2019
Tesla Sales Fall 31% in Q1, Stock Follows

Tesla Inc. sold 63,000 new units in the first quarter, including 50,900 Model 3 sedans. That’s more than double its Q1 2018 output but 31% fewer than Q4 2019.

Photo by Jakob Härter via Flickr

2 min to read


PALO ALTO, Calif. — Tesla Inc. stock fell 9% in premarket trading Thursday following Wednesday’s first-quarter sales report, which showed a 31% decline from the prior quarter. The electric-vehicle manufacturer sold 63,000 new units in Q1 after selling 90,966 in the last three months of 2018.

Some decline was expected following the expiration of the full $7,500 electric-vehicle tax credit offered by the federal government to U.S. car buyers on a manufacturer-by-manufacturer basis, triggered when Tesla sold its 200,000th unit last year. The credit was reduced to $3,750 in January and will be cut in half again in July.

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Tesla also began shipping Model 3 sedans to China and Europe during the quarter. Logistical challenges prevented the factory from filling more than 10,000 orders, contributing to the shortfall. Tesla customers pay full price for their vehicles when they are delivered, not ordered, so “sales” are not necessarily reflective of demand.

The news is nonetheless worrisome for Tesla, which ramped up production and sales throughout 2018 but must continue to move units to pay off its debt. The company started the new year with $3.7 billion cash in hand after repaying $230 million to creditors in Q4, then paid off a $920 million bond in Q1, and now faces a $566 million bill in November.

In a statement, executives said the company ended the first quarter with “sufficient” reserves and assured investors its production goals are unchanged.

“We reaffirm our prior guidance of 360,000 to 400,000 vehicle deliveries in 2019,” the statement read, in part.

Originally posted on Auto Dealer Today

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