Tesla vehicle deliveries drop sharply as Musk backlash affects demand

Core Viewpoint - Tesla is experiencing a significant decline in quarterly deliveries, indicating a potential second consecutive annual sales decline due to waning demand linked to CEO Elon Musk's political stance and an aging vehicle lineup [1]. Delivery Performance - Tesla delivered 384,122 vehicles in Q2, a decrease of 13.5% from 443,956 units in the same quarter last year [2]. - Analysts had anticipated deliveries of approximately 394,378 vehicles, with some estimates dropping as low as 360,080 units [2]. Market Reaction - The market's response to Tesla's delivery figures was somewhat positive, as analysts had recently lowered their forecasts, suggesting that the results were not as poor as initially feared [3]. Stock Performance - Tesla's stock has declined by 25% this year, primarily due to concerns over brand damage in Europe and the U.S. linked to Musk's political affiliations [4]. - Following a public split between Musk and Trump in early June, Tesla lost around $150 billion in market value, although the share price has seen some recovery since then [4]. Product Strategy - Despite Musk's earlier claims of a sales turnaround, Tesla's delivery drop occurs in a growing global EV market [5]. - The company updated its best-selling Model Y crossover, which temporarily halted production and led to some buyers delaying purchases [5]. Revenue and Valuation - Tesla's revenue and profit are heavily reliant on its core EV business, with much of its valuation tied to Musk's ambitions of transforming its vehicles into robotaxis [6]. Robotaxi Initiative - Tesla launched a limited robotaxi service in Austin, Texas, with restrictions and only a small number of vehicles on the road [7]. - The U.S. National Highway and Transportation Safety Administration has initiated an investigation into this autonomous ride service launch [7]. Future Sales Expectations - Tesla plans to produce a more affordable vehicle, likely a pared-down Model Y, by the end of June [8]. - Analysts predict a second consecutive annual sales decline for Tesla this year, with the company needing to deliver over a million units in the second half to meet Musk's growth targets, which is considered a challenging goal [8].