Is the worst over for electric vehicle sales? The surge of 2023 has been over for some time, but Tesla surpassed expected second-quarter delivery figures.
Tesla is still the leader in the electric vehicle market. Several other names are rising up to challenge Tesla’s dominance, but for now, this company remains at the top. Tesla has delivered more EVs than any other automaker in the world so far. The recent decline in demand for EVs brought into question whether these alternative-fuel vehicles were more of a fad than a solution, but things seem to be looking up for Tesla and other names.
A surge in stock prices
The beginning of July brought a surge to the share price of Tesla stock. The price of this stock rose nearly 10% to start the third quarter off right. This company was able to report they had better-than-expected vehicle delivery figures during the second quarter. The estimated delivery figures of 439,000 was surpassed with a total of 443,956 EVs delivered during the quarter. While this number is still 4.8% less than the second quarter of 2023, it showed growth compared to expectations, which was a success for this brand.
Expected models bring strong sales
Which Tesla EVs would you expect to comprise the bulk of these deliveries? If you answered the Cybertruck, you’d be wrong. Although this new electric truck just hit the market and is being delivered as fast as Tesla can make them, most of the Tesla electric vehicles sold were the Model 3 and Model Y vehicles. The Model 3 is a small and affordable sedan that makes it easy to get into a Tesla, and the Model Y is a compact SUV with affordable pricing and a practical setup to be a fantastic choice for many drivers. The Cybertruck reached 21,000 deliveries during the second quarter, which is only a small portion of the total figure.
The decline is on the rise
One way that investors look at sales figures to see if a company is coming out of a decline is to measure the declined percentages compared to the previous year. If the percentage shrinks from one quarter to the next, the company should come out of the downward trend. The first quarter deliveries for Tesla resulted in an 8.5% drop compared to the same time a year ago. Now that the figure is only 4.8%, it seems this EV automaker is coming out of the funk. If the third quarter has similar results, expect Tesla’s stock price to skyrocket.
Challenges abroad for Tesla
The reported sales difference includes the challenges this company faces in China, where BYD is pushing hard to become the top automaker. This challenge, coupled with lackluster consumer demand for EVs in the United States, made the past several months difficult for Tesla. Of course every automaker with a strong EV lineup felt this lack of demand. Tesla has to focus on EVs; they don’t have an ICE division or hybrid lineup to fall back on when things get tough.
Things aren’t all roses at Tesla
Tesla electric vehicles are some of the most popular in the world, but in what is becoming a tradition, the newest models tend to have the most issues. The new Cybertruck already has two recalls. These recalls are to address the challenges with the windshield wiper and trim. Unfortunately, these aren’t recalls that Tesla can program their way out of; they are physical issues, which means owners must find Tesla service centers to have these problems fixed.
In addition to the recalls, Tesla took a little reality check and canceled its goal of shipping 20 million vehicles per year by 2030. This change was reported during the company’s annual impact report in May.
Will the third quarter continue to show positive growth?
Is Tesla truly on the rise, or were the second quarter results a fluke? Some have suggested that the automotive market embraced EVs too quickly, including Tesla’s electric vehicles. Although Tesla continues to be the world’s largest EV automaker, consumers might not be ready to commit to these vehicles.
Some consumers have waited to consider EVs until the prices dropped. Recently, Tesla dropped prices on most of its products. This, coupled with the Federal EV Tax Credit, made it easy for more shoppers to choose a Tesla model, especially with the availability of the Model 3 and Model Y. Is the electric vehicle sales slump over, or will we see another drop in the near future?
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