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Tesla Reports Flat Q1 2023 Delivery Despite Massive Price Cuts But, There’s More To The Story

Tesla has posted its Q1 2023 production and delivery numbers and despite the massive price cuts the EV maker instituted at the beginning of the quarter, Tesla has nonetheless posted flat growth. Although disappointing, several factors suggest that Tesla will increase production and deliveries in the coming quarters.

Despite massive price cuts at the start of the year, Tesla's Q1 2023 production growth remained flat. Earlier today, the company announced on its Investor Relation page that it produced 440,808 vehicles in Q1 2023. Although a new quarterly record, this is barely up by more than a thousand vehicles from Q4 2022 when Tesla produced 439,701 vehicles.

The quarterly delivery numbers came at 422,875 which faired slightly better up 4% or by more than 17,600 vehicles from the previous quarter when Tesla delivered 405,278 vehicles.

And when we break it down by vehicle type, Tesla produced and delivered 421,371 and 412,180 Model 3/Ys respectively. The EV maker also said it produced and delivered 19,437 and 10,695 Model S/Xs respectively, attributing the more than 40% disparity between the production and delivery numbers to the fact that Tesla recently started delivering the refreshed Model S & X in Europe and Asia and that the vehicles are in transit.

On the face of it, Tesla’s Q1 2023 performance might appear disappointing, especially given the massive price cuts, however, there are several factors to keep in mind when trying to process these numbers, especially when seen in the light of Tesla’s continued growth.

Related News: Elon Musk Says It ‘Feels Like The Future’ After Walking The Cybertruck’s Production Line For ‘Several Hours’

The first thing to keep in mind is that Q1 is seasonally a weak quarter for vehicle sales and this is true not just for Tesla but for the entire automotive industry. And although Q1 production and delivery were flat quarter over quarter, Tesla still grew production by 44% when compared to Q1 2022.

And the second thing to keep in mind, especially if we are going to use Tesla’s Q1 performance to assess the EV maker’s continued growth is that Tesla is currently undertaking several massive expansion projects, with two new factories in the process of an early production ramp, two additional factories announced, new vehicles coming to market including the Cybertruck and at least two new vehicles that will be built on the company’s revolutionary Gen-3 vehicle platform.

And to look at these expansion plans in more detail. Tesla's 2023 deliveries are expected to grow in the subsequent quarters thanks to the ramp-up in production at its factories in Berlin and Texas. Tesla, at the end of Q1, achieved a production rate of 5,000 Model Y vehicles per week at its Berlin factory which gives the plant an annualized run rate of 250,000 Model Ys.

China, Tesla's second-biggest market, is also looking good. This quarter Tesla set a new domestic sales record in China in Q1 2023, delivering over 126,000 vehicles, which is already higher than the previous quarterly record Tesla set in Q3 2022.

This is all well and good, however, Tesla is just getting started. Per the company’s official statement, Tesla plans to grow vehicle production annually by 50% until it reaches a production rate of 20 million vehicles a year by 2030.

To achieve this goal, the EV maker is also building a new factory adjacent to Giga Nevada where it plans to build 50,000 Tesla Semis a year. Tesla has also announced a new factory to be built in Nuevo Leon, Mexico. In this factory, Tesla plans to manufacture its upcoming vehicles which will be built on the EV maker’s Gen-3 platform.

Add to this, Tesla’s work in autonomy and the prospect of the EV maker achieving level 5 full self-driving capability, then despite the flat growth recorded in this quarter, the EV maker still looks set for massive growth in the upcoming quarters and for years to come.

And we will be sure to keep you posted as Tesla continues to execute the company’s ambitious expansion plans. Until then, make sure to visit our site regularly for the latest updates.

So what do you think? Disappointed by Tesa’s flat growth in the first quarter of the year? Also, how do you think the EV maker will fare for the rest of the year? Let me know your thoughts in the comments below.

Image: Courtesy of Tesla, Inc.

For more information check out: Tesla Model Y Becomes Best-Selling Vehicle In Europe Out Competing Both ICE & Electric Vehicles

Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.