Tesla deliveries have fallen ~37% in California and ~30% in the US based on registration data, but it’s not surprising amid the pandemic and actually not even that bad of a drop.
Due to the pandemic, Tesla had to shut down its Fremont factory for just over a month in March and April.
It is where Tesla produces most of its vehicles and therefore, the shutdown is expected to have a major impact on Tesla’s sales and ultimately its financial results during the second quarter.
The Wall Street Journal now reports data registration for Tesla in California, Tesla’s biggest market in the US, and it shows a 37% drop in April and May:
“The data from research firm Dominion Enterprises shows registrations fell by a combined 37% in April and May, offering the first window into how the U.S. quarantining measures to slow the spread of the coronavirus affected domestic demand for the Silicon Valley auto maker. It initially seemed more immune to problems than rivals when it posted a surprise first-quarter profit.”
According to the registration data, Tesla delivered 6,260 vehicles in California in April.
The deliveries in April were likely helped by Tesla ending the first quarter with a significant inventory, which the automaker was able to deliver with some operations still going despite the factory shutdown.
In May, the drop was more significant with a 70% decline to just 1,447 units in California.
This is actually not that bad in my opinion.
The broader auto market in the US fell 52% during the same period.
Dominion Enterprises cannot get data from all states, but from the 24 states where it does have access to registration data, it reports a 33% decline to 14,151 Tesla vehicles in April and May.
That’s better than I would have expected.
It makes it likely that Tesla will deliver over 25,000 vehicles in the US in Q2. With similar numbers in China thanks to Gigafactory Shanghai, I think it’s likely that Tesla will deliver over 60,000 cars during the second quarter.
Considering the circumstances, this is truly not that bad of a quarter for Tesla.
However, they are likely going to lose a lot of money. Despite salary cuts and furloughs through April, Tesla had to slash prices to keep demand up and as we reported yesterday, Model Y quality hasn’t been good, which is leading to many rectifications, refused deliveries, and returns – affecting the gross margin.
But in terms of deliveries, I would have thought that California and US registrations would be a little worse than what we are seeing now.
What do you think? Let us know in the comment section below.
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