In a first, Tesla deliveries expected to dip 6% for second straight quarter

Tesla's June-quarter deliveries likely fell 6 per cent, the first time the top EV maker is set to post two straight quarters of decline, as it deals with stiff competition in China and slow demand due to a lack of affordable new models.
 

The company is expected to deliver 438,019 vehicles for the April to June period, according to an average estimate based on forecasts from 12 analysts polled by LSEG, seven of whom slashed their expectations in the past three months. The EV maker is expected to announce the results on Tuesday.
 

Tesla has hit a speed bump after years of rapid growth that helped make it the world's most valuable automaker. It warned in January that deliveries growth in 2024 would be "notably lower" as a boost from months-long price cuts wanes.
 

 

Adding to these problems is a consumer shift to cheaper gasoline-electric hybrid vehicles, which has left Tesla with a growing inventory of vehicles that it is trying to move with price cuts and incentives including cheaper financing options and leases.
 

Earlier this year, CEO Elon Musk shelved plans to make an all-new, cheaper electric car and shifted Tesla's focus to robotaxis, a concern for some investors who fear that autonomous technology will be hard to perfect. Still, investors overwhelmingly voted in favor of his record $56 billion pay package at the annual shareholder meeting last month.
 

Barclays analyst Dan Levy predicted an 11 per cent drop in second-quarter deliveries, Tesla's biggest ever. He said "a soft delivery result could turn attention back to the currently challenging fundamental environment for Tesla".
 

Tesla's stock has lost a quarter of its value this year, making it one of the worst performers on the S&P 500, despite Musk's forecast in April that Tesla would be able to increase sales this year. He has slashed costs including through mass layoffs that gutted Tesla's supercharging team.
 

Tesla shares ended up 6.1 per cent on Monday after Chinese automakers such as BYD posted strong second-quarter sales.
 

Old designs

Some analysts expect the company to post its first annual sales drop this year. In the January-March period, deliveries had dropped by the most in nearly four years and missed Wall Street expectations.
 

Tesla sales have been especially weak in Europe, with sales down 36 per cent in May, due to waning EV subsidies and poor demand from fleet operators, who accounted for nearly half its sales in the region last year.
 

Reuters reported in May that Tesla was working to appease some European leasing firms after its repeated retail price cuts tanked their fleet's value and its slow service and expensive repairs alienated their corporate customers.
 

As rivals in China have rolled out cheaper models, Tesla has been slow to bring new designs to market. In April, Musk said Tesla would introduce "new models" later this year, including affordable vehicles, but offered no details about pricing.
 

Tesla refreshed its Model 3 sedan late last year, but without a major revamp in design. Its best-selling Model Y SUV, its Model S premium sedan, and the Model X SUV have not seen major changes in years.
 

The company started deliveries of its Cybertrucks late last year, but Musk does not expect to mass produce the vehicle until 2025. The pickup has been plagued by recalls and quality issues.
 

In May, Tesla left out its goal of delivering 20 million vehicles a year by 2030 in its latest impact report, a big change after touting for years a long-term annual growth target of 50 per cent for EV deliveries.
 

Tesla expects to unveil robotaxis on Aug. 8, as it seeks to boost adoption of its "Full Self-Driving" software. But it is not clear when production will begin or how many of them will be made.