Tesla Inc. Vehicle Deliveries rose in the first quarter but missed Wall Street expectations as the company grappled with global supply chain disruptions and a brief Covid-19 shutdown at its Shanghai factory.
“It was an *unusually* challenging quarter due to supply chain disruptions and China’s zero Covid policy,” Elon Musk, CEO of Tesla tweeted Saturday morning. Tesla employees and major suppliers “saved the day,” he added.
The electric carmaker said on Saturday it delivered 310,000 vehicles globally in the first three months of the year, up about 68% from the same period a year ago. Deliveries were roughly flat from the last quarter of 2021.
Tesla is massively ramping up production capacity to meet booming demand, adding new factories while trying to keep shipments growing at an average of 50%. Wall Street expected Tesla to deliver about 317,000 vehicles in the first quarter to generate what should be a record quarterly profit when the company reports earnings in a few weeks.
Other Major Automakers announced a slowdown in US sales in the first quarter due to vehicle shortages.
Tesla’s largest factory, located in Shanghai, China, halted production for the last four days of the quarter due to an outbreak of Covid-19 in the city, raising questions about the impact this will could have on deliveries for the quarter. The factory builds Model 3s and Model Ys, and last year Tesla sold more than 470,000 cars made at the factory.
The city of Shanghai, which has a population of 25 million, has suffered a partial lockdown in recent days amid an outbreak of Case of covid19. Residents near the Tesla factory have been ordered to stay inside their homes, public transport has been halted and traffic in the area has been severely restricted.
The Chinese factory also closed for two days earlier in March as the company tested employees for Covid-19.
“I don’t think it will materially affect deliveries,” said Tu Le, general manager of Sino Auto Insights, ahead of the delivery results. “January, February and March are notoriously slow for vehicle sales in China.”
He said sales figures will continue to be watched closely as the impact of pandemic-related lockdowns on the country will be unpredictable.
Model S and Model X vehicle deliveries totaled 14,724. Tesla also delivered a set of 295,324 Model 3 sedans and Model Y compact sport utility vehicles. Tesla does not publish deliveries by region. Additionally, the company said it produced 305,407 vehicles.
The Model 3 and Model Y are Tesla’s best-selling cars and the backbone of its production. Mr Musk said the company does not plan to introduce any new vehicle models in 2022.
Tesla began delivering Model Ys from a new factory in Germany last month. The company is expected to open another factory in Austin, Texas on Thursday. It says the German plant will eventually grow to 500,000 vehicles a year, starting with the Y model.
Global supply chain issues across industries and record inflation rates could impact Tesla’s growth trajectory.
Last month, Mr. Musk tweeted that Tesla was seeing “significant recent inflationary pressure in raw materials and logistics.” Prices for the Model 3 and Model Y have jumped 30% over the past year, according to Bernstein Research.
Still, analysts predict Tesla will continue its trend of delivering more vehicles each consecutive quarter for the rest of the year, with annual totals hitting 1.5 million cars and SUVs.
Write to Meghan Bobrowsky at [email protected]