BUSINESS Tesla's first-quarter deliveries beat expectations on strong China demand

BUSINESS

Tesla's first-quarter deliveries beat expectations on strong China demand

CGTN

19:39, April 04, 2021

A Tesla store in Shanghai, China. (Photo: CFP)

Tesla reported a jump in first-quarter auto deliveries on Friday, beating Wall Street estimates, citing strong demand in China where the electric car maker has been ramping up production.

"We are encouraged by the strong reception of the Model Y in China and are quickly progressing to full production capacity," Tesla said in a statement.

"The new Model S and Model X have also been exceptionally well received ... and we are in the early stages of ramping production," the statement said.

Tesla's Shanghai factory started production of the Model Y late last year in the key market where it has already produced Model 3 sedans. In February, Tesla's China sales jumped from the previous month even as demand normally fell during China's Lunar New Year holidays.

The electric car maker delivered 184,800 vehicles globally during the first quarter, above estimates of 177,822 vehicles, according to Refinitiv data.

This also exceeds its previous record of 180,570 achieved last quarter.

In February, Tesla suspended its California plant for two days due to "parts shortages."

"We believe China and Europe were particularly robust this quarter," said Dan Ives, an analyst at Wedbush. He expects Tesla's annual sales to exceed 850,000 vehicles this year, fueled by the Biden administration's policy of boosting EV sales and by rising global demand.

Gerber Kawasaki CEO Ross Gerber said sales declines of the more profitable cars would lead to weaker margins for Tesla in the first quarter, but he forecast "blowout" results for the second quarter.

Other automakers like General Motors on Thursday reported a rebound in the first-quarter U.S. sales from a coronavirus-induced slump last year, but volumes were capped by a global chip scarcity that forced many companies to cut production.

Tesla has become the most valuable auto company in the world by far, despite production that is a fraction of rivals such as Toyota Motor, Volkswagen and GM.

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