Tesla delivers record number of cars in quarter thanks to price cuts

US electric vehicle maker Tesla delivered a record number of cars in the second quarter. Sales were boosted by price cuts, including in the United States, Britain and China, which helped the automaker compete with other manufacturers. The company delivered a total of 466.140 vehicles, up 83 percent from a year earlier. Tesla announced this overnight.

Early this year, Tesla chief Elon Musk said he believed that pursuing higher sales at lower profits was the „right choice“ for the company.

The automaker’s production rose to nearly 479.700 vehicles from 258.580 in the April-to-June period of 2022. Higher production capacity contributed to the increase. The second quarter was the fifth consecutive quarter in which the number of vehicles produced exceeded the number delivered.

Dan Ives, an analyst at investment firm Wedbush Securities, told the BBC that the price cut in China was a „smart poker move that has been massively successful for Tesla“. China is the automaker’s second-largest market after North America, and it faces strong competition there from local electric vehicle makers.

But Tesla is also facing increased competition in other parts of the world. It is also being affected by rising borrowing costs. These were the main reasons it decided to cut prices.

Tesla currently operates assembly plants in Fremont, California, and Austin, Texas, as well as in Shanghai and Brandenburg, Germany. The company also makes its Semi truck at a battery plant in Nevada, but deliveries of the Semi began in December 2022 and Tesla is not yet producing it in large volumes. In March, Musk announced that Tesla plans to build a new plant near the Mexican city of Monterrey. After meeting Indian Prime Minister Narendra Modi in June, he also announced plans to invest in India.

Price cuts affected the company’s financial performance in the first quarter. Revenue rose by nearly a quarter from January to February, thanks to higher vehicle sales. Profit, however, fell by 24 percent due to lower prices and rising raw material costs. The company will announce its second-quarter financial results on 19 July.