Tesla shares fall after carmaker falls short on delivery estimates

Tesla shares fall after carmaker falls short on delivery estimates

Tesla buyers will now receive $3,750 in tax rebates instead of $7,500, so the company trimmed prices by $2,000 to partially offset the lost credit. The company said it delivered 13,500 Model S vehicles and 14,050 of its Model X.

With Musk having generally reigned in his own behavior and the company's Model 3 production figures much closer to weekly production targets, the alarm bells that were ringing six months ago have quieted considerably.

Tesla more than tripled deliveries of its electric cars in the last three months of the year but the news was not enough for Wall Street which sent the company's shares into a tailspin following news that sales of its first mass market vehicle were less than expected.

1,010 Model 3 vehicles and 1,897 Model S and X vehicles were in transit to customers at the end of Q4, and will be delivered in early Q1 2019.

The electric vehicle maker said it would cut the price on its cars by US$2,000, to help make up for USA buyers now being eligible for only a US$3,750 federal tax credit for the next six months, half of what they previously received.

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CFRA analyst Garrett Nelson commented on the company's sudden stock drop stating: "Tesla shares tend to a have a lot more noise and volatility than most, but we think investors who are willing to take a longer-term view of the story will be rewarded handsomely and continue to believe Tesla is on track to post one of the market's most robust year-over-year earnings increases in 2019".

The 63 150 Model 3s Tesla handed over to customers in the fourth quarter trailed the roughly 63 700 average analyst estimate.

Tesla boosted production during the quarter, churning out 86,555 vehicles, up 8 percent from 80,142 during the third quarter, the company said. Tesla announced today that it is now dropping the price of that particular Model 3 by $2,000, bringing it to $44,000. But some bearish investors are likely interpreting it as a move to stimulate demand, said Wedbush analyst Dan Ives.

There remain significant opportunities to continue to grow Model 3 sales by expanding to global markets, introducing lower-priced variants and offering leasing.

In 2018, we delivered a total of 245,240 vehicles: 145,846 Model 3 and 99,394 Model S and X. To put our growth into perspective, we delivered nearly as many vehicles in 2018 as we did in all prior years combined. The vehicle has been delivered only to North American customers and in its mid to higher priced configurations.

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