Tesla stock drops after it reports first annual decline in EV deliveries
AP/Noah Berger
- Tesla stock fell 8% after missing fourth-quarter delivery estimates by about 10,000 vehicles.
- Tesla's 2024 deliveries marked its first annual sales decline amid rising EV competition.
- Analyst Dan Ives expects Tesla to rebound with 20%-30% delivery growth in 2025.
Tesla stock dropped as much as 8% on Thursday after the company reported fourth-quarter vehicle deliveries.
Shares of the company traded as low as $373.40 before paring losses.
The company delivered 495,000 vehicles in the quarter, missing analyst estimates of about 505,000.
For the full year, Tesla delivered 1.79 million vehicles, representing the first annual sales decline for the company. Tesla delivered 1.81 million vehicles in 2023.
A wave of competition in the EV space has put pressure on Tesla in recent years, with BYD thriving in China and Rivian, General Motors, and Ford finding their footing in the US market.
The bulk of Tesla's deliveries in 2024 were its popular Model 3 vehicle, which accounted for 95% of its total deliveries. The other 5% of vehicle deliveries include the Model X, Model S, and CyberTruck.
The delivery figures are the first real piece of fundamental news for Tesla investors since the November election. Donald Trump's victory helped spark a strong year-end rally for the stock as traders see Elon Musk and his companies benefiting from ties to the President-elect Musk forged during the campaign.
Despite Tesla's decline on Thursday, the stock is up 51% since Trump's election win. Wedbush Securities analyst Dan Ives said a second Trump administration should accelerate the path toward autonomous driving, helping boost Tesla's valuation. He added the delivery numbers were "respectable" and that 2025 should see a return to growth.
"We remain highly confident in Tesla's ability to accelerate delivery growth into FY25 with 20%-30% delivery growth targets the focus for the Street as TSLA is also expected to launch its lower-priced EV in early 2025 to spur growth for vehicle deliveries," Ives said.