Tesla (TSLA) shares fell Oct. 2, closing the day in the red, even with the company reporting record-breaking third-quarter deliveries.
Tesla blew away expectations in the third quarter, delivering 497,099 electric vehicles, a significant increase from the 462,890 cars it delivered in the year-ago period. Analysts polled by Bloomberg on average were expecting the company to deliver fewer than 440,000.
Car buyers were incentivized to purchase EVs this quarter as the $7,500 EV tax credit, which has been in place for 15 years, expired at the end of September.
Still, shares dropped Oct. 2, despite an even day of trading on the broader market.
“Nearly 500,000 deliveries is impressive, but the stock’s drop despite the beat tells you what really matters: investor confidence in what comes next, not what just passed. What likely rattled the market: the feeling that Q3 strength was pulled forward (ahead of the EV tax-credit deadline), leaving Q4 vulnerable to a steep drop,” RTMNexus CEO Dominick Miserandino said.
Image source: Apu Gomes/Getty Images
Tesla stock falls, despite strong Q3 deliveries
One reason for the muted market response to the good news is Tesla’s gains this week, as people have been anticipating the Oct. 2 numbers.
Tesla has increased more than 5% over the previous five sessions and more than 35% over the past month.
The muted reaction is also due to the strong Q3’s universal nature; Ford and General Motors also reported record-setting quarters thanks to the tax credit’s expiration.
Related: Tesla makes the right turn in Europe
Ford (F) also reported record quarterly electrified vehicle sales, with its Mustang Mach-E sales increasing nearly 51% year over year.
Ford sold 85,789 hybrid, PHEV and BEVs in the period, a 20% increase.
GM (GM) sold 66,501 EVs in the quarter. To date, its EV sales have risen by 105% to 144,668 cars.
“No one is in a stronger position for a changing U.S. market than GM,” said GM North America President Duncan Aldred. “We have the best lineup of ICE and EV vehicles we’ve ever had. Our brands have grown market share with consistently strong pricing, low incentives, and inventory.”
Tesla is no longer just an EV company
Tesla CEO Elon Musk has told investors for years not to think of Tesla as a car company, even though in 2024, auto sales drove 90% of its revenue and 94% of its gross margin.
But those auto sales have been falling and not growing for 18 months.
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In August, Tesla and CEO Elon Musk released the Master Plan 4, the fourth (or third, depending on how you count) iteration of Musk’s grand scheme for the company’s future.
However, Master Plan 4 is different from its predecessors. It’s much less about the green revolution or even electric vehicles and more about a future with Tesla-branded humanoid robots known as Optimus.
Musk recently tweeted that he believes Optimus could eventually account for 80% of Tesla’s valuation down the road, but in this current section of that road, Tesla is still an EV company.
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