On Monday, Tesla reported their fourth-quarter earnings.
The electric automaker reported that they delivered 405,278 vehicles last quarter which was the most deliveries ever made by Tesla in the fourth quarter. Unfortunately, Wall Street analysts expected the company would deliver 431,117 vehicles meaning they fell short.
Last year, Tesla delivered 308,600 vehicles in Q4.
The development comes as Tesla, like many other companies, is being hit with the harsh reality of a looming recession, soaring interest rates, logistical problems and slowing demand.
Due to ongoing logistical issues, Tesla’s Q4 deliveries fell short by approximately 34,000 vehicles, despite CEO Elon Musk’s efforts to address these bottlenecks in October.
It is unusual for Tesla to distribute fewer vehicles than it produces. Historically, the company has typically distributed the same or a greater number of automobiles as it manufactures.
The challenges facing Tesla include a decrease in demand in China, the largest automotive market, as well as competition from established companies like Ford and General Motors and newer players like Rivian and Lucid.
As per Reuters, citing an internal schedule, Tesla has decided to operate on a reduced production schedule at its Shanghai facility in January, following the decreased production it implemented this month.
“This was a disappointing delivery number and the bulls will not be happy. Given the backdrop this was better than worse case Street fears but bulls are not popping the champagne. Lot of bad news baked in the stock but a miss is a miss,” said Wedbush Securities analyst Daniel Ives while commenting on Tesla’s fourth quarter results.