Tesla(US:TSLA) Zhi Tong Cai Jing·2025-10-10 07:01Core Viewpoint - Wells Fargo's report indicates that while Tesla's Q3 2025 delivery volume significantly exceeded market and institutional expectations, the bank remains cautious about the company's short-term growth due to the expiration of U.S. electric vehicle tax credits and subsequent demand pressures. The bank maintains a "reduce" rating on Tesla with a target price of $120, suggesting over 70% downside potential for the stock [1]. Delivery Performance - Tesla's Q3 total delivery volume reached 497,099 vehicles, surpassing Wells Fargo's own forecast of 412,000 vehicles by 20.7% and exceeding market consensus of 443,079 vehicles by 12.2%. This also represents a 7% year-over-year growth and a 29% quarter-over-quarter increase [1]. - Notably, Tesla's Q3 inventory decreased by approximately 50,000 vehicles, and deliveries in July and August in China, the EU, and the U.S. fell by about 11% year-over-year, indicating that the significant increase in September's deliveries (over 20% year-over-year) was crucial for the overall Q3 performance [1]. Energy Storage Business - Tesla's energy storage business also showed strong performance, deploying 12.5 GWh of energy storage products in Q3, a notable increase from 9.6 GWh in Q2 [1]. Stock Market Reaction - Despite the delivery data exceeding expectations, Tesla's stock price fell on the day the report was released, reflecting investor concerns regarding the company's short-term growth potential [1]. Promotional Strategies - To mitigate the impact of the expiration of U.S. electric vehicle tax credits, Tesla implemented multiple promotional measures in Q3, including discounts of up to $2,000 on Model Y/3 inventory vehicles in the U.S. and 18 months of free supercharging for Model 3 in the U.S. and Canada, along with a new $6,500 leasing subsidy [2]. - Price pressure is evident, with Wells Fargo estimating a slight decrease in Tesla's average order price in Q3, particularly a 1% decline in the pricing of Model Y/3 [2]. Future Projections - Wells Fargo predicts that Q3 is likely to be Tesla's strongest delivery quarter for the foreseeable future, emphasizing that the company will need to continue offering attractive incentives and discounts to maintain delivery levels in light of the $7,500 tax credit expiration [2]. - Based on concerns about future demand and profit pressures, Wells Fargo has lowered its 2025 core performance expectations for Tesla, forecasting total deliveries of approximately 1.48 million vehicles, a 13% year-over-year decline, significantly below the market consensus of 1.64 million. Additionally, the bank has reduced its 2025 earnings per share forecast to a level 29% lower than market consensus, primarily due to worries about weak Q4 deliveries, profit margin pressures, and declining regulatory credit income [2].