Low interest financing, sweet lease deals, price cuts and free charging boosted Tesla’s global deliveries in the third quarter, the first increase this year for the electric vehicle maker.
The Austin, Texas, company said Wednesday that it delivered 462,890 vehicles from July through September, bolstered by loans as low as 1.99%, and $299 monthly leases on the Model 3, its least expensive vehicle. It delivered 435,059 vehicles during the same period last year.
The figures for July through September came in slightly higher than analyst estimates of 462,000 for the period, according to data provider FactSet.
However, shares of Tesla Inc. dropped sharply in morning trading, down nearly 4%.
The deliveries were “good and a step in the right direction,” wrote Dan Ives of Wedbush, but that there would be pressure on the company's stock because investors had been hoping for even better.
“Overall, this is a clear improvement from the first half and we believe getting in the range of 1.8 million for the year is still the key and important bogey,” Ives said.
Tesla has struggled much of the year to sell its aging model lineup as growth in electric vehicle sales in the U.S. and Europe slowed due to concerns with range, price and the ability to charge on trips.
Falling sales early in the year led to once-unheard of discounts for the automaker, cutting into its industry leading profit margins. Analysts estimated that Tesla’s average vehicle sales price was $42,500 for the third quarter, the lowest price in four years.
The sales decline likely will pull down third quarter earnings when they are announced on Oct. 23.
Tesla’s sales decline comes as competition is increasing from legacy and startup automakers, which are trying to nibble away at the company’s market share.
Nearly all of Tesla’s sales came from the smaller and less-expensive Models 3 and Y, with the company selling only 22,915 of its more expensive models that include X and S, as well as the new Cybertruck.
Wedbush analyst Dan Ives wrote in a note to investors Tuesday that third-quarter sales would bring a rebound as China sales continue to increase and price and demand stabilizes.” As China continues to heat up on the demand story for Tesla with favorable leasing/financing terms and pent-up demand in the region, we are confident that we will see a significant growth figure in the region,” he wrote.
Europe will continue to be slow with macroeconomic pressures, and U.S. demand should stabilize, Ives wrote.
But BNP Paribas Exane said in an investor note that long term expectations of the market are somewhat high for Tesla. The company said its sales estimates for 2026 and 2027 “remain 10% to 15% below the street, respectively.”
Tesla is scheduled to unveil a purpose built robotaxi at an event next week.
FILE - A Tesla Model 3 charges at a Tesla supercharging station situated in the parking lot of an outlet mall Sept. 25, 2024, in Lakewood, Colo. (AP Photo/David Zalubowski, File)
FILE - Visitors look over a 2024 Cybertruck in the Tesla display at the Electrify Expo, July 14, 2024, in north Denver. (AP Photo/David Zalubowski, File)
NEW YORK (AP) — U.S. stocks are slipping in early trading, and crude oil prices are continuing to rise as the world waits to see how Israel will respond to a missile attack from Iran. The S&P 500 was 0.3% lower Wednesday, a day after sliding from its record on worries about a possible widening of the fighting in the Middle East. The Dow Jones Industrial Average was down 159 points, or 0.4%, and the Nasdaq composite was off 0.3%. Oil prices rose by more than 3%. Nike sank 7.4% after reporting revenue that fell short of analysts’ estimates and pulling its forecast for full-year results.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street pointed toward losses before markets opened and oil prices rose further amid escalating tensions between Israel and Iran in an already inflamed Middle East.
Futures for the S&P 500 and the Dow Jones Industrial Average were each down about 0.1% before the bell.
While Israel is not a major producer of oil, Iran is OPEC's third largest producer and the potential for a wider, sustained conflict raises the risk of disruptions to supplies by neighboring producers of crude. However, some analysts have been skeptical that the U.S. would experience massive oil shortages, since U.S. oil production is at an all-time high.
Early Wednesday, U.S. crude was up $2.11, or 3%, to $71.94 per barrel. Brent crude climbed $1.96 to $75.52 per barrel.
Israeli Prime Minister Benjamin Netanyahu vowed to retaliate against Iran, which he said “made a big mistake tonight and it will pay for it.” An Iranian commander threatened wider strikes on infrastructure if Israel retaliates.
Nike shares tumbled 7.2% after the shoe giant posted lackluster first-quarter results, including sales that came in lower than Wall Street was expecting. Nike, which is in the middle of a CEO transition, also pulled its full-year guidance and postponed its investors day conference. Its shares are down about 22% this year.
Shares of Humana shed close to 20% early Wednesday after the health insurer said a Medicare Advantage quality rating drop will hurt future bonus payments the company receives.
On Monday, the S&P 500 set an all-time high for the 43rd time this year. Stocks had been jumping on hopes the U.S. economy can continue to grow despite a slowdown in the job market, as the Federal Reserve cuts interest rates to give it more juice. The Fed last month lowered its main interest rate for the first time in more than four years, and it’s indicated it will deliver more cuts through next year.
The dominant question hanging over Wall Street is whether the cuts will ultimately prove to be too little, too late after the Fed earlier kept rates at a two-decade high in hopes of braking on the economy enough to stamp out high inflation.
Another threat to the economy could lie in a strike by dockworkers at 36 ports across the eastern United States that could snarl supply chains and drive up inflation.
The workers are asking for a labor contract that doesn’t allow automation to take their jobs, among other things. Supply chain experts say consumers won’t see an immediate impact because most retailers have stocked up on goods, moving ahead shipments of holiday gift items.
A debate Tuesday night between vice presidential candidates Democratic Gov. of Minnesota Tim Walz and Republican senator JD Vance drew scant market attention, analysts said.
“The market’s muted reaction says it all — traders are far more focused on pressing economic concerns and geopolitical risks than on the vice presidential showdown,” Stephen Innes of SPI Asset Management said in a commentary.
In Europe at midday, Germany's DAX rose 0.7% and the FTSE 100 in London ticked up 0.1%. In Paris, the CAC 40 picked up 0.2%.
Tokyo's Nikkei 225 lost 2.2% to 37,808.76. It has retreated since the ruling Liberal Democratic Party chose Shigeru Ishiba to lead the government, replacing Fumio Kishida, who stepped aside on Tuesday. Higher energy prices in Japan, which relies heavily on imported oil, gas and coal to power its industries, would add to Ishiba's burdens as he works to pep up the economy.
Hong Kong's Hang Seng roared 6.2% higher to 22,443.73, riding a wave of investor enthusiasm over recent moves by Beijing to rev up the Chinese economy with policies aimed at reviving the ailing property sector and supporting financial markets. With Shanghai and other markets in China closed, trading crowded into Hong Kong.
FILE - Signs marking the intersection of Broad and Walls Streets appear near the New York Stock Exchange on Oct. 1, 2024, in New York. (AP Photo/Peter Morgan, File)
The New York Stock Exchange, right, is shown on Tuesday, Oct. 1, 2024, in New York. (AP Photo/Peter Morgan)
A person walks in front of the Tokyo Stock Exchange building Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
A person walks in front of the Tokyo Stock Exchange building Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
A person looks at an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
People stand in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
People watch an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Oct. 2, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)
