EV giant Tesla Inc TSLA is making its best-selling Model Y more appealing to customers from a cost perspective with price cuts and low interest rates on financing a purchase. Tesla researcher Troy Teslike believes the company is only attempting to avoid yet another bad quarter.
What Happened: The reason for these deals is not that Tesla is attempting to break records, but because Tesla wants to avoid another “very bad quarter” in terms of deliveries, Teslike said.
Teslike expects deliveries for the second quarter to be above 400,000 but “well below” the 466,140 deliveries reported by the company a year earlier. “Therefore, it’s not great,” Teslike said.
“2024 is expected to be the first year we see a decline in Tesla’s yearly deliveries,” he added.
Price Cuts And Incentives: Earlier this month, Tesla launched low-interest rates for those who purchase the Model Y by financing with a Tesla financier or third-party financier in the U.S. Customers who place an order for any version of the Model Y by May 31 will get a 0.99 percent APR interest rate on loan terms ranging from 36 to 72 months.
In China, Tesla’s second-largest market, Tesla cut prices on Model 3 and Y by as much as 6% last month. The company also lowered prices on imported Model S and X in the market by as much as 22%.
Why It Matters: Tesla’s global deliveries dropped 8.5% in the first quarter to just 386,810 units. In the first quarter of 2023, the company had delivered 422,875 units.
Contrary to Teslike’s predictions, Tesla CEO Elon Musk said during the company's first-quarter earnings calls in April that the company will have higher sales in 2024 compared to 2023. The company delivered 1.8 million cars last year.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Photo via Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
