HSBC Stays Cautious on Tesla (TSLA) After Lower-Than-Expected Q4 Deliveries

Core Viewpoint - Tesla's fourth-quarter delivery results fell short of expectations, leading to a reduced rating from HSBC analyst Michael Tyndall with a price target of $131.00 [1] Delivery Performance - Tesla delivered 418,000 vehicles in Q4, which was 3.7% below Visible Alpha consensus and 5.2% below internal projections, marking a 16% decrease year-over-year and quarter-over-quarter [2] - The shortfall in deliveries is attributed to the end of EV credits in the US and weak demand in Europe and China [2][3] Market Dynamics - The end of EV credits in the US has impacted sales, with affordable Standard models not compensating for the decline [3] - High-frequency data indicates weak volumes in both Europe and China, suggesting broader market challenges [3] - The global Battery Electric Vehicle (BEV) market is becoming more regionalized, with US adoption stalling and increasing competition in Europe and China [4] Energy Storage Business - Tesla's energy storage business showed resilience, deploying 14.2 GWh, which exceeded Visible Alpha consensus by 4.7% and the firm's estimate by 7.5% [3] Competitive Landscape - There is skepticism about Tesla's growth drivers due to intensifying competitive pressures and market regionalization, with rising competition likely causing Tesla to lose market share in Europe [4]