Tesla annual deliveries fall for first time as competition hurts demand

Tesla reported its first decline in annual deliveries on Thursday, as the automaker handed over fewer-than-expected electric vehicles in the fourth quarter and incentives failed to boost demand for its aging line-up of models.

Shares of the company fell about nearly 6.0 per cent, indicating investor worries over the challenges facing CEO Elon Musk, who expected promotions including zero-interest financing to power a “slight growth” in deliveries in 2024.

Reduced European subsidies, a shift in the US towards lower-priced hybrid vehicles and tougher competition especially from China’s BYD have pressured Tesla. In response, Musk pivoted Tesla to self-driving taxis and backed President-elect Donald Trump with millions of dollars in campaign donations in hopes that it could bring regulatory relief for the company.

Tesla handed over 495,570 vehicles in the three months to Dec 31, missing estimates of 503,269 units, according to 15 analysts polled by LSEG. It produced 459,445 vehicles in the period, down about 7.0 per cent from a year ago.