Tesla posted weaker-than-expected fourth-quarter deliveries, leading to the company’s first year-over-year sales decline.
In the first three quarters of 2024, Tesla delivered about 1.29 million vehicles around the globe, down about 2% from the same span in 2023.
Shares were weak but investors soon will look past the deliveries figure. They are focused on a new model and self-driving cars in the new year.
Tesla on Thursday reported fourth-quarter vehicle deliveries of 495,570, up from the 484,507 delivered in the fourth quarter of 2023. Wall Street was looking for about 507,000 vehicles.
Tesla shares dropped 6.1%, closing at $379.28 apiece, while the S&P 500 and Dow Jones Industrial Average fell about 0.2% and 0.4%, respectively.
Shares finished lower for a fifth consecutive day, dropping about 18% over the span, according to Dow Jones Market Data. It’s the worst five-day stretch for the stock since the five days ended Dec. 28, 2022, when it fell 18.2%.
As of Thursday’s close, shares are down about 21% from their all-time closing high of $479.86 on Dec. 17, 2024.
Hitting the consensus probably wasn’t required to keep shares stable. Future Fund Active ETF (FFND) co-founder and Tesla shareholderGary BlacktoldBarron’sthat anything above 500,000 should be good enough. Wedbush analystDan Ivesagreed, saying the “whisper number,” the figure investors really expect, was about 500,000 vehicles.
A whisper number can be higher or lower than published estimates for any number of reasons, including that not all analysts update their estimates with the same frequency.
Tesla’s results fell short of the whisper. There was reason for optimism heading into the report. The company predicted growth in sales volume in its third-quarter earnings report in October. That implied about 515,000 deliveries for the fourth quarter.
Tesla missed growth by about 20,000 units for the full year. Tesla delivered 1,789,226 cars, down about 1% from the 1,808,581 delivered in 2023. It’s the first year-over-year sales decline for the company since the introduction of the Model S Sedan, Tesla’s first true production vehicle, in 2012. The S, Tesla’s original roadster, was built on the base of a Lotus vehicle.
The fourth quarter was still a record, up about 2% from the 484,507 vehicles in the fourth quarter of 2023.
Despite essentially no growth in EVs sales, Tesla stock finished 2024 up more than 60%. Almost all of that gain came following the Nov. 5 presidential election.
Investors certainly care about quarterly deliveries, but whether Tesla would grow deliveries in 2024 hasn’t been driving the stock. These days, investors are far more focused on two developments expected for 2025 and how CEO Elon Musk’s close relationship with President-elect Donald Trump will help the electric vehicle maker.
For starters, Tesla is expected to start selling a lower-priced EV in early 2025. Musk believes the new model will help Tesla increase sales volume by 20% to 30% this coming year.
Wall Street projects about 2.1 million units sold for 2025, up a little less than 20% compared with 2024.
Tesla is also planning to launch an artificial intelligence-trained self-driving robotaxi service in late 2025. The Trump administration could help Tesla meet that deadline by issuing favorable federal regulations on autonomous driving.
“Delivery results are likely to be a modest negative today, but Bulls likely continue to defend the AI story,” wrote Guggenheim analyst Ronald Jewsikow in a Thursday report. “Delivery results underscore, in our opinion, most if not all of 2025 vehicle growth will come from new affordable models which remain challenging to model based on limited details on pricing, features or timing.”
Jewsikow rates shares Sell and has a $175 price target for the stock. Wedbush’s Ives rates shares Buy and has a $515 price target for the stock.
“Taking a step back, over the last decade we have never viewed Tesla simply as a car company…instead we have always viewed Musk and Tesla as a leading disruptive technology global player and the first part of this grand strategic vision has taken shape over the past 5 years,” wrote Ives in a Thursday report. “The next step in this broader Tesla strategic vision begins is the autonomous and AI era which will be accelerated under a Trump White House.”
Investors will continue to focus on the new model and Tesla’s robotaxi service. Those two things will go a long way toward determining if Tesla stock can make it three strong years in a row.
Tesla shares gained 102% in 2023 after falling 65% in 2022. Since Tesla went public in June 2010, selling shares at a split-adjusted price of $1.13, the stock has suffered annual declines only twice.
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