Tesla Inc. has seen its deliveries fall by 31 percent in first quarter as the electric carmaker suffered with the deliveries of Model 3 to Europe and China due to longer transit times. The electric carmaker delivered only 63,000 electric vehicles in the first quarter this year and has cautioned that it expects the profits to suffer as a result of lower than expected delivery volumes, as reported by Reuters.
In spite of the drop in deliveries, the Silicon Valley carmaker expects to deliver 360,000 to 400,000 vehicles this year and the electric carmaker said that the company has been outpaced to fulfill the demand for the Model 3 in the US market after it was made available for $35,000.
The report adds that there are nearly 10,600 vehicles in transit this quarter as compared to 1,900 vehicles last quarter. Speaking about these numbers, Wedbush analyst Daniel Ives said, “Overall, the Street was expecting an apocalyptic quarter and Model 3 deliveries were better than feared by many.”
“Due to a massive increase in deliveries in Europe and China, which at times exceeded 5x that of prior peak delivery levels, and many challenges encountered for the first time, we had only delivered half of the entire quarter’s numbers by March 21, ten days before end of quarter,” Tesla said in its report.
The company announced on Wednesday that it expected a drop in net income after lower delivery and increased price cuts. Tesla delivered 50,900 Model 3s in the quarter, falling short of analysts’ estimates of 58,900, according to IBES data from Refinitiv.
The model 3 is the foundation on which Tesla’s growth strategy is based and CEO of the company, Elon Musk is under tremendous pressure to deliver the vehicles to new international markets.
The company has faced many practical challenges while delivering Model 3 to international markets. Musk tweeted that the company encountered “many unexpected challenges when Model 3s came through the Belgian port of Zeebrugge in early February.”