Tesla tops expectations as price cuts lift deliveries to record

OAKLAND, – Tesla delivered a record 466,140 cars worldwide in the second quarter, outpacing Wall Street estimates.

The results, posted on Sunday, demonstrated that chief executive Elon Musk's vow to chase volume by cutting prices has had its intended effect.

Analysts surveyed by Bloomberg had expected Tesla to ship 448,350 cars in the quarter.

“It's a big beat,” said Mr Ben Kallo of Robert W. Baird. “People were still bracing for another round of price cuts, and this big delivery number makes that less of a risk.”

The deliveries are the most ever in a quarter for Tesla, and an 83 per cent increase from a ago.

The company also managed to trim the gap between production and deliveries – a figure closely watched by analysts – to 13,560 units in the second quarter.

In the first quarter, it produced nearly 18,000 more cars than it delivered to customers.

“Everyone was worried about inventory build, and it looks like they've normalised,” said Mr Kallo. “The delta between production and deliveries is shrinking, which is what Tesla said they would do.”

Tesla, which sells its cars directly to consumers, has a lot of levers to move vehicles.

Besides cutting prices across the line-up earlier in 2023, the company introduced perks, such as three months of free fast-charging in the United States for cars delivered before June 30, to entice buyers.

Analysts have predicted that price cuts will continue into 2024.

Tesla does not break out its quarterly delivery numbers by individual vehicle type or region. The Models 3 and Y accounted for 96 per cent of sales. Tesla also makes the Model S and X.

Tesla is easily still the largest vehicle maker in the US, but it is facing fresh competition around the world.

Its most recent vehicle – the Model Y – debuted in 2020.

In China – its No. 2 market – the company has fallen well behind BYD, which has a much fresher line-up and increasingly global ambitions.

Tesla announced last week that it was cutting prices of its premium models in China by more than 4.5 per cent, following a decision to hand out cash subsidies to some buyers of its Model 3 vehicles in June.

Tesla will report second-quarter earnings on July 19.

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