Tesla sales fall short of estimates as stronger dollar bites

Tesla reported third-quarter sales that fell short of Wall Street estimates, citing the US dollar’s growing strength, along with production and delivery bottlenecks.

Revenue rose to $21.5bn, the company said in a shareholder letter on Wednesday, compared with projections of $22.1bn. Profit excluding some items rose to $1.05 a share, exceeding the $1.01 average of estimates compiled by Bloomberg.

Analysts are paying close attention to how quickly Tesla can increase output of its mass-market Model Y SUV from new factories in Austin and Berlin – a key milestone for the pioneering EV maker.

Tesla cited higher costs related to a slower-than-expected ramp up in output at the new factories, as well as difficulties shipping vehicles.

The Austin, Texas-based company is sticking to its long-held plans to increase vehicle deliveries by 50 per cent on average annually over multiple years.

In April, chief executive officer Elon Musk said Tesla would produce more than 1.5 million vehicles this year. The company has made 929,910 through the first three quarters – and needs to crank out more than 570,000 in the fourth quarter to meet that target. It produced 305,840 vehicles in the final three months of 2021.

Read: Tesla delivers record 343,830 cars; misses estimates

Tesla shares were down 3 per cent to $215.29 at 4.19pm in New York after the results were announced. They have declined 37 per cent this year against the backdrop of Musk’s $44bn bid to buy Twitter and concerns over a slowing economy, higher inflation and rising interest rates.

Read: Tesla shares give up gains on renewed prospect of Musk buying Twitter