Tesla Inc.'s (TSLA) stock plummeted over 5% in pre-market trading on Thursday, as the electric vehicle giant kicked off the new year on a disappointing note.
The primary catalyst behind Tesla's pre-market plunge appears to be the company's Q4 vehicle delivery numbers, which fell short of Wall Street estimates. Tesla reported deliveries of 495,570 vehicles for the fourth quarter, missing the consensus estimate of 503,269 units, according to data compiled by LSEG.
More significantly, Tesla's total deliveries for 2024 stood at 1.79 million units, marking the first annual decline for the company. This comes as a disappointment, as Tesla had guided for "slight growth" in deliveries for 2024.
The lackluster delivery numbers suggest that Tesla's aggressive price cuts and incentives towards the end of 2024 failed to significantly boost demand for its aging vehicle lineup. Analysts have expressed concerns about rising competition in the EV space, which could further impact Tesla's sales in the coming quarters.
Adding to Tesla's woes is the explosion of a Cybertruck vehicle outside the Trump International Hotel in Las Vegas on New Year's Day. While CEO Elon Musk has clarified that the explosion was caused by fireworks or a bomb carried in the rented truck and was unrelated to the vehicle itself, the incident has generated negative publicity for Tesla.
The Cybertruck explosion, which killed the driver and injured seven others, has raised questions about the safety and security measures associated with Tesla's vehicles. While the incident appears to be an isolated one, it could potentially dent consumer confidence in the company's products, at least in the near term.
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