Tesla demand in China drives ‘home run’ quarter for deliveries

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Electric vehicle deliveries that beat Tesla Inc. estimates in the first quarter suggest that boss Elon Musk’s bid for growth in China and Europe is beginning to pay off.

The results marked a strong start to a year in which Musk, the company’s chief executive, has global operations to help increase production and sales. Tesla based in Palo Alto, California delivered 184,800 cars worldwide in the first three months of the year, topping the average estimate of 169,850 in a Bloomberg analyst survey and topping the fourth-quarter figure by roughly 4,000 vehicles.

The quarter was “a massive home run in the eyes of the bulls,” Wedbush’s Dan Ives wrote in a research note on Friday. “We believe China and Europe were particularly robust this quarter as the track record now places Musk & Co. to exceed 850k for the year, which is well ahead of whispered expectations.”

Musk is entering China, which is already the world’s largest auto market, including for electric vehicles, to take hold amid competition from local electric vehicle startups as well as Volkswagen AG. Auto sales are expected to increase in the nation this year for the first time since 2017, and in March, Prime Minister Li Keqiang told the National People’s Congress that the government will help. increase the number of electric vehicle charging stations and battery exchange facilities.

Tesla’s volume sets itself apart from most other automakers, which are primarily showing declines in part due to the limitations of electronic chips, Jefferies analysts said in a research note. “Stocks should respond well to Q1 delivery data.”

After a remarkable run in 2020 in which its share price rose by more than 700%, Tesla shares fell about 6% this year through April 1. Friday was a market holiday in the US.

“It has been a brutal sell-off for Tesla and EVs, but we think it will now be in the rearview mirror,” wrote Ives, who maintained a “neutral” rating on the stock.

‘Strong reception’

Tesla recently updated the Model S sedan and the X, an SUV. Without Model S and X Vehicles were manufactured in the quarter and only 2,000 were delivered in total.


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