The Tesla Wall is Wrong: Electric Vehicles Aren’t Delivered, and Tesla’s Stock Prices are Undermining China

The analysts were hoping for more than 1.7 million vehicles delivered for the year but that was not possible as they needed to deliver less in order to meet their goal of 50 percent growth. It was another quarter of deliveries for the EV maker, which has been dealing with many challenges this year, as well as just missing that goal.

The automaker clarifies that some of these electric vehicles (EVs) were “in transit at the end of the quarter,” adding that they “have been ordered and will be delivered to customers upon arrival at their destination.” Tesla also notes that it had been difficult to “secure vehicle transportation capacity and at a reasonable cost during these peak logistics weeks,” which is why some of the EVs still haven’t been delivered. Last year, Musk told employees to stop rushing to increase quarterly deliveries and to instead focus on minimizing costs related to transit.

Tesla has other ways of making money beyond selling cars. The emission credit sales the company recorded this quarter were more than triple what they had in the previous quarter. The company generates this revenue by selling these credits to automakers that make fewer “clean” vehicles than are required by the US government and the European Union. The company sold 75% of its digital currency, bringing in over a billion dollars in extra revenue.

It is the first earnings report since the announcement of a prototype humanoid robot by Musk at the company’s Artificial Intelligence Day. It was arriving during Musk’s controversial and chaotic acquisition of the micro networking site, which might or may not occur.

“For Musk in the eyes of investors, patience is wearing extremely thin as the long term vision,” Wedbush analyst Dan Ives wrote in a note on Tuesday before the Q3 earnings report. The Street doesn’t care about robot talk anymore in this white knuckle period of market turmoil.

Demand was weak as the stock price of TSLA plunged. Electric vehicles were in high demand last year. The company missed its growth targets throughout the year and it scaled back production in China.

Turmoil in China is continuing to squeeze Tesla’s bottom line. Even as covid-related shutdowns became less frequent, heatwaves gripped the country, causing officials to order factories to shutter, including Tesla.

Evidence of car buyers’ sinking interest in Teslas became apparent last month after the company announced a rare sale in a bid to clear out inventory. Tesla offered two rebates for buyers taking delivery of a vehicle before the end of the year, initially offering a $3,750 discount then doubling the rebate to $7,500 with two weeks left in 2022.

In the statement released on Monday, the company thanked customers and employees for helping them achieve a great year in the face of significant challenges.

“We continued to transition towards a more even regional mix of vehicle builds which again led to a further increase in cars in transit at the end of the quarter,” the company said in a statement. “Thank you to all of our customers, employees, suppliers, shareholders and supporters who helped us achieve a great 2022 in light of significant COVID and supply chain related challenges throughout the year.”

It was a year of unique struggles for Tesla, which included flagging demand, an aging lineup, and increased competition from legacy automakers. Musk’s purchase of Twitter led to a subsequent sharp decline in Tesla’s stock price, which plunged by as much as 65 percent over the course of the year. The plunge shaved billions from Musk’s net worth, which he claimed was the first person to lose $200 billion.