The electric car maker saw a record decline in Model 3 deliveries in the first three months of 2019, with 63,000 vehicles delivered, down from 90,966 in the fourth quarter of 2018, reports Bloomberg. Tesla shares sank as much as 11 percent to $260.59 as of 9:30 a.m. Thursday in New York.
As many as four brokerage firms have cut their price targets on Tesla’s stock, citing profitability and revenues after deliveries of the high-priced luxury cars more than halved as compared to fourth-quarter deliveries.
RBC analysts called deliveries of the Model S/X “very disappointing.” They are estimating this will translate into more than a $1 billion shortfall in revenue compared to previous estimates. Tesla has said in February it would post a first-quarter loss as it focused on the launch of the cheaper version of its Model 3.
“Tesla continues to struggle as a ‘real car company,’ with demand collapsing for the tired Model S/X platforms and higher priced versions of the Model 3,” said Cowen analyst Jeff Osborn in a note Thursday.
However, Tesla is reaffirming its full-year forecast of 360,000 to 400,000 vehicle deliveries in 2019, and this should reassure investors, especially with the first-quarter miss. Tesla also said about 10,600 vehicles were in transit to customers – a reflection of the strong demand for the less-pricier Model 3 in China and Europe.
The company also pointed out that one of the big challenges is trying to deliver cars around the world when they are all being made at one factory in the San Francisco Bay Area. This is an indication that production could outpace deliveries for a while longer, reports CNBC.
