Tesla Q1 deliveries tumble as Elon Musk's political role hammers sales

Tesla shares moved lower in early Wednesday trading after the carmaker posted a weaker-than-expected tally of first quarter deliveries amid slumping EV sales and coordinated protests tied to Elon Musk's political role in the White House.

Tesla  (TSLA)  delivered 336,681 new cars over the three months ended in March, down 13% from last year's first quarter tally of 386,810 and 32% from the record 495,570 reached over the final three months of 2024.

Analysts' forecasts for deliveries ranged from 340,000 to around 380,000, with Visible Alpha data pegging the March-quarter target at around 373,000.

However, during Tesla's extraordinary post-election rally, when investors were betting that Elon Musk's close tied to President Donald Trump would support group sales, Wall Street analysts had expected a total of around 470,000 in first quarter deliveries. 

"This decline can be attributed to two main factors. First, Tesla has faced some level of brand damage as a result from Elon’s DOGE efforts," said Deepwater Asset Management analyst Gene Munster. "The Tesla brand has unintentionally become a political statement."

"Second, Tesla has been retooling the Model Y (which) has delayed the overall supply of vehicles for the quarter, also attributing the decline," he added. "Although we believe the rest of 2025 will improve from this quarter, it's going to be a transitional year."

Tesla delivered 323,800 units of its Model 3 sedan and Model Y midsize SUV, as well as 12,881 of its higher-priced Model S sedan and Model X full-size SUV, the report indicated.

Production fell 16.3% from last year to 362,615 vehicles, thanks in part to tight supply chains and fading demand in China. Model 3/Y production was pegged at 345,454 units with Model S/X and "other model" output at 17,161 units.

Tesla sales have were pummeled over the first three months of the year, with data showing deliveries in France and Sweden falling to the lowest levels in four years, with year-on-year declines of 65% in Denmark and 42% in the Netherlands over the month of March.

In China, Tesla's biggest market, sales data for the first three months of the year show a 22% decline from year ago levels and an overall tally of around 172,250 units.

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"We are concerned with recent moderating growth trends across all three key regions (US, EU, China)," said Wells Fargo analyst Colin Langan. "Few levers remain to increase volumes outside of pricing & model refreshes as the company continues to offer aggressive financing promotions to salvage deliveries."

Langan, who named Tesla as a new 'tactical short' in a note published Tuesday, said he was skeptical of the group's ability to execute a safe and successful launch of the self-driving Cybercab later this spring in Austin "given limited unsupervised testing & their vision-only approach."

"Experts believe Tesla's AV tech comes w/ considerable safety concerns. Anything short of a deployed fleet ride-hailing paying consumers by this June will likely be seen as disappointing," he added.

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Focus will now shift to Tesla's first quarter earnings, expected after the close of trading on April x, with analysts looking for a bottom line of 45 cents per share on revenues of around $22.38 billion.

Tesla shares were marked 4.3% in premarket trading to indicate an opening bell price of $256.90 each, a move that would extend the stock's year-to-date slump to around 32.3%.