While Tesla was working hard to ramp up production of Model 3, the EV maker faced challenges in deliveries and its total vehicle deliveries in the first quarter slumped by 31 percent from the previous quarter and were well below analyst estimates.
Tesla delivered around 63,000 vehicles in Q1, up by 110 percent compared to the first quarter of 2018, but 31 percent lower than the vehicles delivered in Q4 2018, the EV maker said in a statement.
Of the total 63,000 vehicles delivered in Q1 2019, some 50,900 were Model 3 and 12,100 were Models S and X.
“Due to a massive increase in deliveries in Europe and China, which at times exceeded 5x that of prior peak delivery levels, and many challenges encountered for the first time, we had only delivered half of the entire quarter’s numbers by March 21, ten days before end of quarter. This caused a large number of vehicle deliveries to shift to the second quarter. At the end of the first quarter, approximately 10,600 vehicles were in transit to customers globally,” Tesla said.
The carmaker warned that the lower-than-expected deliveries will impact its bottom line in Q1, but tried to appease the market that it ended Q1 “with sufficient cash on hand.”
“Because of the lower than expected delivery volumes and several pricing adjustments, we expect Q1 net income to be negatively impacted. Even so, we ended the quarter with sufficient cash on hand,” Tesla said.
Analysts had expected Tesla’s total Q1 deliveries to be upwards of 70,000 vehicles at the very least and were quite disappointed with the delivery numbers.
“Tesla’s 1Q19 vehicle production & deliveries report was substantially worse than expected,” CNBC quoted J.P. Morgan analyst Ryan Brinkman as saying in a note to clients.
The market was also disappointed, with Tesla shares sinking nearly 9 percent at 10:33 a.m. EDT.