Tesla Closed Down 8.6%, The Biggest One-day Drop In The Last Four Months

On Oct. 2, Tesla announced delivery figures for the third quarter of 2022, with a record high of 343,830 units delivered, but below Wall Street's expectations of about 358,000 units.
In the third quarter, Tesla delivered 325,158 Model 3 and Model Y, and 18,672 Model S and Model X.
Tesla blamed logistics for the lower-than-expected deliveries, noting that many vehicles "are still in transit.

In a press release on Sunday, the company wrote.

"Consistently, our deliveries have surged at the end of each quarter due to our volume production approach for different regional markets. As production volumes have been ramping up extraordinarily, the challenge of securing long-haul capacity at a reasonable cost during peak logistics and transportation hours has grown."

"In the third quarter, we began the transition to 'more balanced volume production on a weekly basis for different regional markets,' which resulted in an increase in the number of cars still in the long-haul process at the end of the quarter. These in-transit cars have been ordered and will be delivered to customers upon arrival at their destinations."

Tesla's deliveries for the quarter not only fell short of Wall Street's expectations, but also those of many analysts and company trackers.

Troy Teslike, a well-known Twitter user who specializes in tracking Tesla deliveries and other data analysis, tweeted

My estimate for (Tesla's third quarter) production was 1.7% higher, while my estimate for deliveries was 5.6% higher (its always been a goal to have less than 3% estimate error), the largest estimate error I've had on deliveries in recent quarters. It looks like there are some transportation issues.

 

Record deliveries, market still disappointed?

Strong delivery numbers often mean good things for Tesla's stock price.

Tesla deliveries have exceeded analysts' expectations in eight of the last 11 quarters, during which Tesla's stock price has outperformed the market between the time delivery results were announced and the time the company reported quarterly earnings.

For example, Tesla shares rose about 9 percent between the July delivery report and the third quarter earnings report, and the S&P 500 rose about 4 percent during the same period. Tesla's stock price has risen about 17 percent since the July delivery data was released. The S&P 500 has fallen about 6 percent during this period.

In recent weeks, Tesla investors seemed relieved as the outbreak eased and were impressed by better-than-expected second-quarter numbers.

Despite the record third-quarter delivery figures, analysts say the lower-than-expected numbers may not be enough to support Tesla shares in the coming weeks.

Investors remain concerned about rising inflation and interest rates. As of Friday's close, Tesla shares are down about 25 percent so far this year, while the S&P 500 and Nasdaq composite indexes are down about 25 percent and 32 percent, respectively.

However, analysts also noted that while bearish people will be concerned about weaker-than-expected delivery numbers, bullish people will likely be concerned about rising production. Tesla released data yesterday showing that total production reached 365,923 units in the third quarter. Bulls will also be looking at delivery spreads and adding the number of vehicles in transit to their delivery estimates for the fourth quarter.

Tesla will report its third-quarter results after the market closes on Oct. 19, when investors will want to get an update on production and vehicles.


Discover our Range

TESLA MODEL Y ACCESSORIES

View all

TESLA MODEL 3 ACCESSORIES

View all