Business
Tesla Sales Fall Again As More Automakers Crowd Electric Vehicle Market
Tesla sales declined for the second consecutive quarter. It is the first time in the company’s history that revenues have fallen from the prior year for two consecutive quarters.
Tesla’s sales for the quarter totaled over 444,000, a 5% decrease from the previous year. That is less than the 8.5% dip the corporation experienced in the first quarter. However, Tesla’s share price, which has made CEO Elon Musk one of the world’s wealthiest individuals, is based on a track record of increasing auto sales.
The sales reduction reflects growing competition in the electric vehicle sector. While total EV sales continue to increase, the growth rate has been slower than projected, leaving investors begging for each car sold to be more profitable than previously.
Tesla | PixaBay Image
Tesla Sales Fall Again As More Automakers Crowd Electric Vehicle Market
Before this year, Tesla only reported a year-over-year sales loss once, during the peak of the pandemic when plants were closed due to stay-at-home orders.
The sales figures contained some good news, however. Sales exceeded some analysts’ forecasts of 436,000, which was enough to keep the lead in global sales of all-electric vehicles over Chinese automaker BYD.
On Monday, BYD reported EV sales of 426,000. That is 21% higher than a year ago as BYD continues to close the gap with Tesla. In the fourth quarter, BYD briefly surpassed Tesla in global EV sales.
However, Tesla’s (TSLA) sales exceeded expectations, causing shares to rise by more than 4% in early trading. Despite Tuesday’s gains, shares are still down more than 10% yearly.
Tesla has been progressively lowering pricing for over a year in response to increased competition from major automakers transitioning from petroleum-powered vehicles to EVs, including BYD in China and Volkswagen, General Motors, and Ford in Europe and North America. These price cuts have boosted sales but reduced company margins. Tesla stated Tuesday that it will release its second-quarter financial results on July 23.
GM did not publish global sales data on Tuesday, but it did report US sales data. US EV sales were up 40% from a year ago and 34% from the first quarter total to roughly 22,000, a record for the carmaker. Overall sales were practically unchanged, up 0.6%, owing in part to the CDK platform hack that affected many of its dealers’ operations. A modest decrease in sales of regular gasoline-powered vehicles offset the robust EV sales.
Even as it withdrew its best-selling American EV, the Bolt, sales fell 90% from 14,000 a year earlier. However, increases in sales for its Blazer EV and Cadillac Lyriq more than compensated for the lost Bolt sales. It continues to release new EV models and will have ten in US showrooms by the end of the year.
Tesla | PixaBay Image
Tesla Sales Fall Again As More Automakers Crowd Electric Vehicle Market
However, dropping sales indicate that rising competition is influencing its sales. The majority of its car lineup is somewhat ancient. Since its premiere in 2012, Tesla’s flagship automobile, the Model S, has not undergone a complete redesign. The Model Y, its best-selling model, has seen little alteration since its debut in 2019. The Model Y is one of its most recent models.
Last week, Tesla announced the third and fourth recalls of the Cybertruck, citing issues with its massive single windshield wiper and a piece of plastic trim around the side of the truck bed that can detach while driving. The recall applies to virtually all of the 12,000 Cybertrucks sold to consumers. Another recall was issued in April due to an accelerator pedal that could stick down.
SOURCE – CNN
