Tesla delivers record cars but below expectations as ‎competition heats up

Tesla failed to achieve the expected deliveries during the first quarter of this year, as the gloomy outlook for the economy and the increasing competition affected the efforts of the electric car manufacturer to support demand by reducing prices.

According to “Reuters”, Tesla deliveries rose 36 percent compared to last year, but remained below the 52 percent growth rate sought by CEO Elon Musk this year.

Tesla delivered 422,875 vehicles, a record for the company, but less than analysts’ expectations of 430,008 vehicles, according to Refinitiv data.

Investors were awaiting the outcome of the risk of its CEO, Elon Musk, who said that lower prices would stimulate sales and compensate for the damage caused by the erosion of profit margins.

Musk said in January that his company’s car sales this year could reach two million cars in the absence of obstacles in the external arena, up from 1.3 million in 2022.

Tesla’s production of cars exceeded the number of delivered cars, as it manufactured 440,808 cars during the first three months of this year.

The company has increased production volumes at two plants it recently opened in Texas and Berlin, as Chinese production recovers from the COVID-19 shutdown.

Some analysts expect that Tesla will have to cut prices again in conjunction with other manufacturers reducing prices, with continued concerns about the deteriorating economic situation.

Tesla’s announcement of reducing the prices of its car in China caused competition to intensify with a number of Chinese companies, including (BYD) and Xping, which announced price cuts to preserve their market share amid weak demand.

Meanwhile, BYD accounted for 41 percent of electric car sales in the world’s largest car market during the first two months of this year, while Tesla was only able to seize an eight percent share.