Tesla Deliveries Rise to Record After Slashing Prices on EVs

(Bloomberg) — Tesla Inc. delivered 422,875 cars worldwide in the first quarter, setting a record after it cut prices to appeal to consumers buffeted by rising interest rates and faster inflation.

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The results, posted Sunday, came in just ahead of the median estimate of analysts surveyed by Bloomberg, for 421,164 vehicles to have been shipped.

Austin, Texas-based Tesla has led the auto industry into battery powered cars. The company produced 440,808 vehicles during the quarter, more than the 432,513 analysts expected. On the last earnings call, Chief Executive Officer Elon Musk said Tesla aims to make 1.8 million to 2 million vehicles this year.

“Tesla deliveries were in line with the consensus numbers, but it was a disappointment relative to some of the whisper numbers,” said Gene Munster, managing partner of Deepwater Asset Management. “They grew deliveries 36% from a year ago, but Musk’s comment on the last earnings call was for 50% delivery growth. They will have to pick up the pace for deliveries for the rest of the year.”

Tesla doesn’t break out sales by region, but the US and China are its largest markets. The overwhelming majority of sales were of the Model 3 sedan and Y crossover.

Tesla slashed prices early in the year to boost demand after fourth-quarter deliveries disappointed investors.

“With everything going on in the macro environment, these are very good numbers,” said Ben Kallo of Robert W. Baird. “There are a lot of different consensus figures out there. People will switch very quickly from this number to talking about what the margins will be for the first quarter. There’s been a lot of focus on price cuts hurting margins.”

Read more: Tesla Deliveries Face One Big Question: Did Price Cuts Work?

The company makes the Model S, X, 3 and Y models in Fremont, California. Its Shanghai factory produces the Model 3 and Y. Tesla also makes the Model Y at its plants in Austin and Berlin.

(Updates with analyst comments in fourth, seventh paragraphs)