Tesla misses Wall Street target, cuts U.S. prices

And we ask what our readers what effect they think lower tax credits will have on electric cars in 2019.

Whereas Tesla began 2018 with production being the big challenge, chief executive officer Elon Musk is starting this year with worries about how much of a market is left for pricier versions of the Model 3.

Tesla claimed to have delivered 90,700 vehicles in their fourth quarter, short of Wall Street projections for the company.

Tesla's vehicle deliveries fell short of Wall Street analysts' expectations as the Silicon Valley automaker wrestles with the realization that its federal tax credits are quickly running out. This number is comprised of 63,150 Model 3 (signifying a 13% growth over Q3), 13,500 Model S, and 14,050 Model X vehicles.

Shares in Tesla Inc dropped as much as 9 percent on Wednesday on worries of future profitability, after the electric auto maker cut US prices for all its vehicles to offset lower green tax credits, while falling short on quarterly deliveries of its mass-market Model 3 sedan.

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Meanwhile, outgoing Maryland democratic representative John Delaney officially announced his campaign for president in 2017. That is consistent with Warren's pitch as she has risen to national prominence by taking on bankers and large companies.

Tesla shares are down 8.4 per cent at $304.91 in pre-market trade.

In Q4, we produced and delivered at the rate of almost 1,000 vehicles per day, setting new company records for both production and deliveries. That's vastly better than where the company was a year ago, but significantly below the 6,000/week target Musk previously said Tesla would achieve by August 2018. Now, Tesla buyers only get half that credit, or $3,750, for the next six months, before it falls to $1,875 in July. With regions such as Europe and China expected to start receiving the electric sedan in the next few months, Tesla's numbers would likely remain healthy in the year to come.

In a client note Wedbush analyst Daniel Ives said the price cut was "a potential positive" for demand, "but not what the bulls wanted to hear on the impact to profitability and ultimately the bottom line".

Production in Q4 grew to 86,555 vehicles, 8% more than our prior all-time high in Q3. Tesla said fourth-quarter deliveries were eight per cent higher than its previous high in the third quarter of 2018. "I don't expect that Tesla operates in the black in 2019", said Frank Schwope, an analyst with NORD/LB.

  • Darren Santiago