Tesla has exceeded Wall Street expectations and more than doubled its car deliveries in the first quarter of the year, brushing off chip and battery shortages and looming electric car rivals.
Elon Musk’s electric car company delivered a record breaking 185,000 cars in the first quarter, traditionally a quieter period for the company. Deliveries were up from 84,000 the year before and were above the 180,570 delivered in the fourth quarter of last year.
It only produced its cheaper Model 3 and Model Y cars in the quarter, and delivered just 2,020 of its more expensive Model S sedans and Model X SUVs, which the company is overhauling as it focuses on its mass-market vehicles.
Tesla said: “We are encouraged by the strong reception of the Model Y in China and are quickly progressing to full production capacity.
“The new Model S and Model X have also been exceptionally well received, with the new equipment installed and tested in Q1 and we are in the early stages of ramping production.”
Dan Ives, an analyst at Wedbush, described the results as a “drop the mic” moment which “defied the sceptics and bears”.
Mr Ives said: “With a green tidal wave kicked off by Biden this week in the US, and global electric vehicle demand skyrocketing going after a $5 trillion total addressable market over the next decade, we believe these delivery numbers are a paradigm and sentiment shifter for the space going forward.”
The surprise results came as rivals accelerated into what is becoming an increasingly congested electric car market. Last month Ford’s Mustang Mach-E electric crossover trumped Tesla sales, according to Morgan Stanley analysts.
Meanwhile Nio, Tesla’s biggest rival in China, announced sales of 20,060 cars in the first quarter, above forecasts.
The industry is suffering from a semiconductor shortage which has affected production of electrical devices from gaming consoles to smartphones, and caused Tesla to temporarily halt production at its plant in Fremont, California.
A drought in Taiwan has hit production at the world’s largest chipmaker, TSMC, and a surge in demand for home electronics demand thanks to Covid-19, has crippled car production around the world.
Ford and General Motors have shut down factories and sent workers home, according to reports meanwhile Toyota, Audi, Mazda and Nissan have slashed production forecasts.
Morgan Stanley warned in February of its “increasing concern” over a possible battery shortage that could blight the electric car market for years.
“From our perspective, at least, we’d say the chances of there not being a material shortage of battery cell capacity relative to demand is remote,” Morgan Stanley’s Adam Jonas wrote in an email to investors.