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Originally Posted by Idaho2018GTPremium
This news made me happy: "The Austin, Texas, company said Tuesday that it delivered 386,810 vehicles worldwide from January through March, almost 9% below the 423,000 it sold in the same quarter of last year. It was the first year-over-year quarterly sales decline in nearly four years.
The company blamed the decline in part on phasing in an updated version of the Model 3 sedan at its Fremont, California, factory, plant shutdowns due to shipping diversions in the Red Sea, and an arson attack that knocked out power to its German factory.
Tesla dramatically lowered U.S. prices by up to $20,000 for some models last year. In March it temporarily knocked $1,000 off the Model Y, its top-selling vehicle. Those price cuts narrowed the company’s profit margins and spooked investors.
Analysts polled by FactSet expected the average selling price for Model Y to be $41,000 last quarter, $5,000 less than a year ago and $15,000 lower than the peak of $56,000 in June of 2022."
Tesla makes stupid excuses like it's due to ramping up refreshed Model 3, but the fact is they made way more than 386,810 vehicles in this last quarter. Despite Tesla forcing massive price drops, they are selling less than when they were more expensive last year.
I don't like Teslas. A friend just bought a brand-new Model Y Long Range. I drove it on Sunday when it was 2 days old. Made me like Teslas even less. I hated the spartan and uninspiring interior. The exteriors and proportions always look silly except for the Model S, which looks good from the outside. While it drove nice enough, I would not buy one.
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I just got some new information yesterday that might put some of this in a different light.
At the end of the day, most of the issues with Tesla’s Q1 sales fall mainly on the supply side not the demand side. I usually get inventory data from our researchers the first week of each month. Because Tesla and Rivian have a direct-to-customer sales model and so no dealers to hold inventory stock, we’ve been unable to measure and report their days on hand inventory. Well, apparently that has somehow changed. Not sure how our research wizards have figured it out, but this month we got reporting n Tesla and Rivian vehicles in inventory.
Getting to the point, Tesla’s inventory on Model Y at the end of March is less than 5,000 units and amounts to a 4 day supply. Rivian R1S is around 1,000 units and about a 10 day supply. Model 3 inventory is about 3 days. Because they use the direct-to-customer model, the typical 60 days measure for days inventory on hand is not a good comparator.
So the point is, Tesla (and Rivian) are having more of a problem producing than selling. In Tesla’s case, whether we want to believe it or not, changing over two models simultaneously (Model 3 and Model Y) while launching a completely new model (Cybertruck) is like playing 3-dimensional chess. There’s only so many ways you can split your attention. Model 3 is new in all sales regions. Model Y is transitioning to a new design in China right now, eventually transitioning in Europe then the Austin plant in the next few months.
Top that off with an arson fire at the Berlin plant and components impacted by the Black Sea turmoil and yeah, it’s been a tough quarter.
By the way…what ever happened to all the “BEVs are piling up on dealer lots” clickbait videos? They seem to have gone quiet lately. I’m not surprised. Other than Mach E and Lightning there really was no volume of BEV inventory on lots to begin with. And Ford has ironed those problems out. Mach E was at over 400 days inventory at one point and is now down to a respectable 78. Ford wisely cut a shift at Rouge Assembly and slowed down capacity installation at Blue Oval and inventory appears to be in line. Hard for us to tell because Ford intentionally lumps Lightning in with all F150 volume.
Ironically, Ford has thousands of F150 trucks stockpiled in company lots around Dearborn. I don’t categorize this as evidence that F150 sales are falling off the cliff anymore than I gave an ounce of merit to the “sky is falling, EV inventory is out of control videos”. There’s a technical problem keeping Ford from shipping those trucks.