Elon Musk’s automaker shook the market after reporting business numbers very different from what investors had in mind. What is the cause of the rise

Tesla (TSLA) shares rose more than 6.5% on Wall Street on Monday to USD 680 after the electric vehicle maker’s second-quarter production and delivery numbers, which reflect sales figures, hit all-time records. Shares of the automaker at the forefront of electric and autonomous vehicle development score a 160% gain in 2023, making it one of the best bets for investors this year.

elon musk tesla

Elon Musk introduced Tesla’s flagship Model S in 2011.

Elon Musk’s brand once again outdid itself and presented production numbers and vehicle deliveries above what could have been predicted just a few years ago. At the beginning of last week, the Wall Street Journal predicted that the company would most likely have quarterly deliveries of around 448,000 units, which would have been enough to create a new record. However, this figure was far exceeded.

The price adjustment of its luxury units was a strategic move by Tesal that paid significant dividends.
In terms of the number of vehicle deliveries, Tesla met the second quarter of 2023 with a total of 466,140 electric cars. This total is divided into 19,225 units split between the Model S and Model X, the firm’s most elite versions, and no less than 446,915 for the more accessible models, Model 3 and Model Y. With these numbers, the company surpassed its previous record set at 422,000 units during the first quarter of 2023.

In terms of production figures, Tesla reported that in the second quarter it obtained a total of 479,700 electric cars assembled among its main factories around the world. Again, this total is split between the Model S and Model X group, with 19,489 units, and the Tesla Model 3 and Model Y, with 460,211 vehicles produced.

“The price cut has been a smart poker move for Tesla and is paying significant dividends, especially for the Chinese market,” Dan Ives, an analyst at Wedbush Securities, told Reuters.

Tesla is expected to hit record sales in China, its second-largest market after North America, despite stiff competition from market leader BYD. “We believe margins will shrink in the coming quarters,” Ives added.

Tesla cut prices starting in China since late last year, which has eroded its first-quarter margins. In April, Tesla chief Elon Musk doubled down on the price war, saying the electric vehicle maker would prioritize sales growth ahead of profits amid economic weakness and increasing competition.

Since then, it has increased discounts on all its ranges, in a move aimed at reducing inventory, while making all its Model 3s eligible for full federal credits of $7,500 starting in June in the United States.

Meanwhile, the electric vehicle pioneer has scored a series of victories in the electric vehicle fast-charging arena with the likes of Ford Motors and General Motors, as well as fast-charging equipment manufacturers that have agreed to adopt the company’s North American Charging Standard (NACS).

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