Tesla Inc.’s first-quarter deliveries fell less than expected from record levels reached late last year.
Tesla handed over 88,400 vehicles worldwide in the first quarter, a record for the period, but down 21 percent from the last three months of 2019. But the total beat analysts’ average estimate for about 78,100.
In the first quarter of 2019, Telsa racked up sales of 63,000 worldwide when Model 3 deliveries were ramping up overseas.
“I’m shocked they did so well,” said Gene Munster, managing partner of venture capital firm Loup Ventures. “I don’t know how they did it. They had every excuse in the world to put out a bad number.”
Tesla tried to salvage as much business as possible last month by introducing “touchless” deliveries at a time when authorities around the globe are urging would-be car buyers to shelter in place.
While Tesla managed to deliver more vehicles than the year-ago quarter, the improvement was small considering the company added a new product -- the Model Y -- and opened an assembly plant in China.
Tesla didn’t give an update on whether it still expects to deliver at least 500,000 vehicles this year. Tesla's shares closed Friday's trading up 5.6 percent to $480.01.
Analysts anticipate Tesla will sustain a significant blow along with other automakers from the spread of the viral illness known as COVID-19.
With a global recession increasingly likely, consumers are expected to be less interested in making big-ticket purchases like new vehicles even once they’re able to leave their homes.
The vehicles delivered in the quarter include the first Model Y crossovers that started reaching customers in mid March.
Tesla said production and deliveries of the Model Y was significantly ahead of schedule
Musk has predicted it will be a big seller, potentially eclipsing the combined volume of all other vehicles in Tesla’s lineup: the Model 3, S and X.
Tesla didn’t say how many vehicles it built during the quarter at its plant near Shanghai, which started production late last year. While the company suspended output when measures to contain the coronavirus forced plant closures across China, government authorities bent over backward to help the company reopen quickly.
“The production number was very good, especially with what was going on in China,” Ben Kallo, an analyst at Robert W. Baird, said of the 102,672 vehicles Tesla built in the quarter. He isn’t bothered by the company neglecting to update its 2020 forecast. “It shows they don’t have visibility in this environment. Saying nothing is better than saying something at this point.”
Tesla’s only U.S. assembly plant, in Fremont, Calif., stopped production on March 23 after days of back-and-forth with city and county officials. San Francisco Bay area health authorities have since extended “stay-at-home” orders to at least May 3.
Tesla delivered over 14,000 fewer cars than it produced in the quarter, meaning the automaker built inventory.
Musk warned back in July -- long before the coronavirus outbreak -- that the first quarter of this year would be “tough.” Tesla’s vehicles are no longer eligible for federal tax credits in the U.S., and buyers also are getting less-generous support from the Netherlands, a market that contributed to record fourth-quarter deliveries.
“I view it as a small victory during a dark time,” said Dan Ives, a Wedbush Securities analyst who rates Tesla a hold. “The devil is in the details and the big question is around 2Q cash burn given this unprecedented, treacherous environment.”