Tesla's problems increase in the first quarter of 2024, and lowering prices may not be a good alternative for its business.
Tesla has recorded its lowest quarterly deliveries since 2022 so yes, once again, the American electric car company is experiencing another downturn. Additionally, this decline represents the largest drop in the company's history relative to analyst projections.
This first quarter of 2024 has been a sign that even the leading scorer in the electric vehicle market is not exempt from the slowdown in sales that has affected its competitors since the second half of 2023.
So far, Tesla has managed to keep up with changing consumers, now interested in electric vehicles, by reducing its profit margins in order to reduce prices.
However, even its budget models, the Model 3 and Model Y, saw a 10% decline in deliveries compared to the same period last year, and a 20% decline compared to the previous quarter.
A complicated year awaits you
For those looking to buy an electric vehicle, the thought of Tesla lowering its prices may not be enough. A recent study by Boston Consulting Group suggests that future electric car buyers place more value on vehicle operating costs and the reputation of established brands.
Many of these potential buyers show a preference for hybrid vehicles, a category in which Tesla has no presence. BCG predicts that high-end and mass-market sedans, coupes and crossovers will be the most in-demand segments, just where Tesla has a strong presence.
In addition, BCG found that only one vehicle currently meets the price, range and charging time requirements satisfactory to consumers: the Hyundai Ioniq 6. The Tesla Model 3 “follows closely” in this regard, according to BCG.
Tesla attributed part of the decrease in first-quarter deliveries to the slowdown in production due to the launch of the renewed Model 3 and the temporary closure of factories abroad, such as Germany.
However, some analysts have expressed concern that Tesla's first-quarter report could lead to an even more difficult year. Deutsche Bank's Emmanuel Rosner said: “Beyond the well-known production bottleneck, there may also be a serious demand problem.”
We just have to wait until April 23, when investors will have the opportunity to ask these types of questions directly to Elon Musk during a conference call about the company's financial results.