Tesla Inc (NASDAQ:TSLA) will reveal second-quarter deliveries in coming days that will be nothing to write home about, said broker Wedbush, with Wall Street to be "laser focused" if they suggest boss Elon Musk will cut future delivery targets.
Analysts at the US investment firm noted that, ahead of the electric vehicle maker's delivery numbers, which are due to be released at the end of the week or at the weekend, future estimates will be far more important than actual deliveries, which were hampered by supply chain issues and factory shutdowns in Shanghai.
Wedbush forecasts that roughly 40% of the Austin, Texas group's global deliveries will come from the Chinese market, with poor production in April and May effectively wiping off 70,000 units from initial forecasts.
At the start of 2022, total global deliveries were expected to be in the region of 1.5mln-1.6mln, but factory closure and global supply chain issues mean that number is now closer to 1.4mln.
For the second quarter, roughly 250,000 deliveries of Tesla’s Model Y are expected, with anything over 260,000 to be “viewed positively” by Wall Street.
Model Y/3 deliveries in the region of 245,000 will be viewed as “good enough,” said Wedbush analyst Dan Ives.
However, Tesla is still on course to increase deliveries by roughly 50% year over year in 2022, even with the Shanghai factory essentially shut in April and May.
Despite a weaker global market, Ives believes that demand for Tesla’s Model Y is still far outstripping production, by at least 15%.
The analyst added that the electric vehicle manufacturer will be able to achieve 2mln deliveries globally by 2023, with improved production capacity once the Berlin and Austria Giga factories get up to the production level of Shanghai.
Wedbush stuck with its 'outperform' rating, with the target price set at US$1,000, having been slashed from US$1400 at the end of last month.
This month Musk said he plans to slash the numbers of salaried workers by 10% over the coming three months, but expects to grow the number of hourly workers at the same time, which followed a memo sent to employees earlier this month where he said he had a “super bad feeling” about the economy.
Musk also said the company's new 'gigafactories' in Texas and Germany were "gigantic money furnaces" losing billions as they get up to speed.