Tesla Inc. posted document quarterly automobile deliveries after slicing costs of its vehicles, however quarter-on-quarter gross sales progress was modest due to rising competitors and a bleak financial outlook.

The automaker delivered 422,875 automobiles within the first three months, up 4 % from the earlier quarter and 36 % greater than in the identical quarter a yr in the past.

The corporate doesn’t break down geographical outcomes, so its U.S. efficiency will not be recognized till automobile registration knowledge arrives from the states in coming months.

Tesla delivered 6 % extra of its mainstay Mannequin 3/Mannequin Y automobiles within the first three months than within the earlier quarter. However the variety of deliveries for its higher-priced Mannequin X/Mannequin S automobiles slumped by 38 %.

The automaker produced extra vehicles than it delivered, manufacturing 440,808 automobiles within the first three months.

Tesla ramped up manufacturing at new factories in Texas and Berlin, and in China as manufacturing recovered from a COVID-19 lockdown hit. The corporate tweeted on Sunday that its Texas manufacturing unit constructed 4,000 Mannequin Y vehicles final week, whereas the automaker mentioned in February that its German plant was producing 4,000 vehicles per week.

CEO Elon Musk, who has missed his personal bold gross sales targets for Tesla lately, mentioned in January that 2023 deliveries might hit 2 million automobiles with out exterior disruption, up from 1.3 million in 2022.

Buyers have been watching Musk’s gamble that slicing costs would stimulate gross sales, though they fear about eroding margins. In January, Tesla slashed costs globally by as a lot as 20 %, unleashing a value struggle after lacking Wall Avenue supply estimates for 2022. The essential Mannequin Y that used to promote for $65,990 now prices $54,990.

“If that they had not lower the value it could have been ugly. I feel what it tells you is the financial system is getting robust,” Gene Munster, managing accomplice at Deepwater Asset Administration, mentioned on Sunday. “They confirmed an acceleration, however they didn’t speed up to the extent that Elon had recommended it could,” Munster mentioned.

The primary-quarter deliveries evaluate with analyst expectations of 430,008 automobiles, in response to Refinitiv knowledge based mostly on seven analysts.

In keeping with a imply of estimates compiled by FactSet as of Friday, Wall Avenue was anticipating Tesla to report deliveries of round 432,000 automobiles for the quarter, The Wall Avenue Journal and CNBC reported.

Tesla missed the determine analysts surveyed by Refinitiv and FactSet have been anticipating. Different estimates present Tesla beat Wall Avenue expectations with its 422,875 automobiles delivered. Analysts surveyed by Bloomberg anticipated 421,164 automobiles could be shipped.

Tesla mentioned a consensus of greater than 20 analysts known as for 421,500 automobiles delivered, Tesla investor Gary Black mentioned in a tweet. Reuters couldn’t independently verify that determine.

The consensus is “everywhere,” Deepwater’s Munster mentioned.

Barclays analyst Dan Levy anticipated Tesla could also be pressured to decrease costs additional as many automakers have matched the cuts and considerations a few weakening financial system persist.

Tesla didn’t instantly reply to Reuters’ questions on whether or not additional cuts are in retailer.

Additional clouding the demand outlook are U.S. electrical automobile subsidies, which can fall on some fashions beginning on April 18.

Tesla’s cuts in China ignited a value struggle, with Chinese language rivals together with BYD and Xpeng dropping costs to defend market share amid weakening demand.

Market chief BYD accounted for 41 % of so-called new vitality automotive gross sales on the earth’s greatest auto marketplace for the primary two months. Tesla, in contrast, had a share of 8 %.

Musk warned that the prospect of recession and better rates of interest meant the EV maker might decrease costs to maintain progress on the expense of revenue. In January, Musk mentioned the value cuts had stoked demand.

Tesla shares have soared greater than 68 % this yr on hopes the corporate would win the value struggle it began, though the inventory stays greater than 50 % under its November 2021 peak.

Shares have fallen since Tesla’s investor day on March 1 when Musk mentioned little about how quickly the EV maker would possibly launch a extra reasonably priced, mass-market automobile.