Tesla Inc. (NASDAQ: TSLA)
Shares of Tesla Inc. took a dip of more than 9% in the pre-market trading on Wednesday after Model 3 sedan deliveries missed the estimates of Wall Street analysts. Tesla also revealed it would slash prices on all its vehicles, an announcement that left investors concerned.
Model 3, the sedan that Tesla is relying on to take on the mass market, will now start at $44,000 after the company lowered its price by $2,000. According to a statement released by the company on early Wednesday, the decision to cut the price of Model 3 was partly to compensate for the reduction of federal tax incentives for the its vehicles that started phasing out from Jan. 1, 2019.
Elon Musk, Chief Executive Officer of Tesla, has been aiming at offering the Model 3 sedan at a price of $35,000 to make it more affordable as well as to amplify the adoption of electric cars. However, producing the vehicle hasn’t been easy as Musk and his team had initially anticipated. The company has no managed to keep up with its own guidance of producing 5,000 Model 3 sedans every week.
International Model 3 deliveries in China and Europe are scheduled to start next month, according to the company. Tesla also said that expansion of Model 3 sales to other markets (including with a right-hand drive variant) will occur later this year.
Increased sales and production of the Model 3 sedans lifted total vehicle deliveries from 29,870 in the fourth quarter of 2017 to 90,700 in the fourth quarter of 2018. Analysts were expecting total deliveries of 92,000 vehicles, including the Model X sport-utility vehicle and Model S large sedan, according to figures compiled by FactSet.
The company delivered a total of 63,150 Model 3 during 4Q 2018, compared with 1,550 in the same period a year ago. Analysts, though, were anticipating 64,900 Model 3 deliveries. Shares of the company were down $22.29 to $310.51 at 12:43 GMT-5 in New York.
Tesla Inc. Profile
Tesla, Inc. engages in the design, development, manufacture, and sale of fully electric vehicles, energy generation and storage systems. It also provides vehicle service centers, supercharger station, and self-driving capability. The firm operates through Automotive, and Energy Generation and Storage segments. The Automotive segment includes the design, development, manufacture and sale of electric vehicles.
The Energy Generation and Storage segment includes the design, manufacture, installation, sale, and lease of stationary energy storage products and solar energy systems, and sale of electricity generated by its solar energy systems to customers. The company was founded by Jeffrey B. Straubel, Elon Reeve Musk, Martin Eberhard, and Marc Tarpenning on July 1, 2003 and is headquartered in Palo Alto, CA. – CNN Money