Tesla Sets Record Deliveries, Proves Taking Lead at the EV Arena

Jan 02, 2024 12:58 AM EST

TESLA PARKED BLACK VEHICLE — (Photo : PEXELS/Borys Zaitsev )

In 2023, Tesla appears poised to reach a remarkable milestone, potentially delivering 1.82 million vehicles globally, marking a substantial 37% surge from the previous year. An aggregate forecast compiled from 14 analysts by LSEG suggests around 473,000 units were delivered in the fourth quarter alone.

Hitting Record High, Still Short for Musk's Target

Anticipation mounts as the electric vehicle giant gears up to disclose its quarterly delivery and production figures, expected as early as Tuesday last week. Despite Elon Musk's January optimism about reaching 2 million deliveries in the absence of unforeseen events, his October cautionary remarks hinted at the impact of elevated borrowing expenses, suggesting potential pressure on demand.

As reported in Reuters, Tesla anticipated yet another exceptional quarter in electric vehicle (EV) deliveries, probably falling short of CEO Elon Musk's lofty goal of 2 million deliveries set earlier in the year. To counter declining sales, Tesla capitalized on its top-tier profit margins and reduced prices across its four car models worldwide in 2023. This strategic move primarily targeted China, where Tesla faced market share erosion by domestic competitors such as BYD.

Reason for the Lead

Slackening EV demand and competitive pricing pressures have led automakers like Ford Motor (F.N) to scale back their electrification strategies, positioning Tesla as the dominant leader in the United States.

This doubled Tesla's stock value this year. Garrett Nelson, a CFRA Research senior analyst, expects Tesla's fourth quarter deliveries to be excellent, solidifying its market leadership. Moreover, the corporation, after ramping up year-end sales by elevating discounts on its primary models, has articulated aspirations to attain a 50% average annual growth rate spanning several years.

As shared on The Motley Fool website, it's almost a monopoly with Tesla in the EV market. Numerous followers of the EV sector presumed that Tesla reduced its vehicle prices throughout 2023 to counter the escalating competition. The lower pricing boosted sales, with big manufacturers and startups releasing new EVs.

This technique also cut Tesla's profitability. Tesla still has big profits and a billion-dollar cash cushion by the third quarter. With this capital and cash flow, the corporation wants to build more plants and increase production. In contrast, its EV rivals lack the same financial stability and flexibility.

More About Tesla

On a global scale, Tesla boasts close to 55,000 available charging stalls. Furthermore, several regions have witnessed a more accelerated EV adoption rate compared to the United States. In China, which hosts Tesla's most extensive factory, EVs represented 19% of total vehicle sales in the initial half of 2023. Moreover, on a worldwide scale, new passenger vehicle sales comprised 15% EVs.

Europe, the second-largest EV market, saw 50% sales growth in the first nine months of 2023, according to the European Automobile Manufacturers Association.

Tesla has around 26,000 stalls at 2,300 North American Superchargers. However, Electrify America, the largest US open fast-charging network, has 3,700 slots. This explains increasing automotive partnerships with Tesla to use Tesla's EV chargers. Tesla's commitment to expanding its charging network globally solidifies its position as a leader in electric vehicle infrastructure.