Tesla’s Record-Setting Q4 Meets A Surprising Annual Sales Dip

Tesla closed 2024 with contrasting milestones by achieving its highest-ever quarterly deliveries while simultaneously recording its first annual sales decline in company history, where this complex picture shows both the resilience and challenges facing the world’s most prominent electric vehicle (EV) automaker.

Q4 saw Tesla deliver 495,570 vehicles, setting a new quarterly record and surpassing the previous mark of 484,507 set in Q4 2023. However, this strong finish was not enough to prevent an annual decline, as total deliveries for 2024 reached 1,789,226 vehicles, falling short of 2023’s 1,808,581 deliveries by around 1.1 percent. This conveys a substantial shift from the company’s 38% growth in 2023.

The production figures tell a similar story of challenges. Tesla produced 459,445 vehicles in Q4, notably below the Q4 2023 record of 494,989 units. The annual production total of 1,773,443 vehicles marked a 3.9 percent decrease from 2023’s 1,845,985 units, suggesting operational hurdles throughout the year.

The Model 3 and Model Y continued to dominate Tesla’s product mix, accounting for 471,930 of Q4 deliveries, while other models – including the Model S, Model X, and Cybertruck – contributed 23,640 units. For the full year, these mainstream models represented 1,704,093 deliveries, with other vehicles accounting for 85,133 units.

A bright spot in Tesla’s results came from its energy storage business, which the company now includes in its quarterly reports. The fourth quarter saw a record deployment of 11 GWh of energy storage products, contributing to an annual total of 31.4 GWh. This diversification into energy storage represents a growing segment of Tesla’s business model.

Several factors contributed to these results. Early in 2024, Tesla faced significant disruptions, including supply chain complications from Red Sea shipping conflicts and an arson attack at its Berlin Gigafactory. The company also implemented its most aggressive discounting strategy to date, offering direct price reductions, enhanced referral programs, and incentives such as free Supercharging and Full Self-Driving features to maintain sales momentum.

In the broader context of global EV competition, Tesla maintained its position as the world’s largest BEV manufacturer, but with a narrowing margin. BYD delivered 1,764,992 battery EVs (BEVs) in 2024, coming close to Tesla’s numbers. Notably, BYD actually surpassed Tesla in Q4 with 595,413 BEV deliveries, and when including plug-in hybrids (PHEVs), BYD’s total of 4.25 million vehicles in 2024 far exceeded Tesla’s output.

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Throughout Tesla’s performance, the company’s ability to achieve record quarterly deliveries despite various headwinds demonstrates resilience but the annual decline suggests it may be entering a new phase of its growth story, one characterized by more moderate expansion and increased focus on operational efficiency. Tesla will release its complete financial results for Q4, scheduled for January 29, 2025.

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