Tesla’s stock surge since the presidential election has led many to believe it was solely due to CEO Elon Musk’s friendship with President-elect Trump. However, as the company’s latest quarterly delivery report shows, there are more pressing issues at play. Despite Musk’s efforts to shape regulations around autonomous vehicles, demand for Tesla’s electric vehicles appears to be plateauing.
Tesla reported 495,600 deliveries in the fourth quarter, a 2.3% increase from last year but below the consensus estimate of 510,000. This decline marks the first time the company has seen a drop in full-year vehicle deliveries, falling from 1.81 million to 1.79 million. The Cybertruck’s addition to its lineup at the end of 2023 did not seem to boost sales.
Industry trends and market shifts are contributing to Tesla’s demand problem. Early adopters of electric vehicles have purchased their options, leading to decreased enthusiasm among buyers. Hybrid sales have risen in place, while competition from cheaper alternatives has made the EV market more competitive. Even Musk acknowledges that elevated interest rates and lower prices for used Teslas could affect vehicle sales.
While Trump policy changes may offer some benefits, such as streamlining regulations around autonomous vehicles, it seems unlikely to address Tesla’s core demand issues. The company must address these challenges head-on if it hopes to regain momentum in the electric vehicle market.
Source: https://finance.yahoo.com/news/tesla-problem-trump-cant-fix-090600868.html