Tesla shares drop on disappointing quarterly performance
Tesla shares have fallen after the electric carmaker revealed that it missed expectations for deliveries and will be cutting its vehicle prices by $2,000 in the US.
The price cut, which will apply to Model S, Model X and Model 3 cars, is in response to a reduction in green tax credits.
Tesla said it delivered 90,700 vehicles in the three months to December.
Its shares fell by about 8% at the start of US trading.
Ahead of the price cut announcement, chief executive Elon Musk urged Tesla customers to make use of federal tax credits.
Reminder to US buyers that the $7500 tax credit cuts in half in 5 days! Order online at https://t.co/46TXqRrsdr to see if there is any inventory left in your region or visit Tesla stores.
— Elon Musk (@elonmusk) December 26, 2018
End of Twitter post by @elonmusk
Worth around £6,000 ($7,500), the credits are set to reduce by half after the first 200,000 Tesla vehicle deliveries in the US.
The company also said it delivered 63,150 Model 3s in the quarter, falling short of FactSet estimates of 64,900.
Nicholas Hyett, Equity Analyst at Hargreaves Lansdown, said that investors had been expecting “Herculean achievements”.
“For most automotive groups these would be very impressive numbers – almost tripling the number of vehicles you deliver in just one year is no mean feat,” he added.
In its previous results statement, Tesla promised to focus on increasing its production rate, which is crucial to the company’s long-term profitability.