Tesla's fourth-quarter deliveries report follows a huge late-year rally in the stock that lifted its gain for 2024 to 63%.

Summary

Tesla reported its first annual decline in deliveries, with 1.79 million vehicles delivered in 2024 compared to 1.81 million in 2023.

Fourth-quarter deliveries (495,570) fell short of analyst estimates, causing Tesla shares to drop 7%.

Challenges included rising competition in Europe and China, declining sales despite price cuts, and growing inventory of Cybertrucks.

Analysts cited CEO Elon Musk’s political involvement as a potential distraction.

While Tesla plans to release lower-cost autonomous vehicles in 2025, its lack of affordable EVs and intensified competition have strained its market dominance.

  • @[email protected]English
    61•4 days ago

    Market capitalization is just simple math, multiplying a company’s stock price by the number of shares that have been issued. Tesla has issued roughly 3.2 billion shares and is currently trading at around $550, which makes their current market cap about $1.75 trillion dollars.

    I don’t understand how the value can be that high compared to all of the other companies, especially China.

    On its face it seems utterly nonsensical that Tesla is worth as much as all other auto makers combined, when Tesla only accounts for something like 5% of total US car sales. There are two reasons I can think of why this is currently so:

    • Tesla accounts for roughly half of all US electric vehicle sales, and electric vehicle sales are roughly 10% of all US vehicle sales. If electric vehicles largely replace ICE vehicles and if Tesla maintains that share of EV sales, then Tesla will be an extremely valuable company. Investors might be betting on a) electric vehicles and b) Tesla continuing to the win the lion’s share of electric vehicle sales.
    • Tesla investors are irrational. Personally, my money is on this one. I think long-term Tesla is going to get crushed by cheaper and better-built EVs, probably from China but also possibly from other existing car manufacturers. Sometimes I’m tempted to short Tesla’s stock based on this belief, but to quote John Maynard Keynes: “Markets can remain irrational longer than you can remain solvent.”
    • @Cornelius_Wangenheim
      12•4 days ago

      It’s more that Tesla is a bubble. The thing with bubbles is that it’s actually completely rational to buy into them while they’re inflating. As long as you get out before they pop, you can make a ton of money.

        • @Cornelius_Wangenheim
          3•3 days ago

          It’s rational on an individual level because you can know it’s a bubble, know the company is overvalued and yet still conclude that the best move is to buy. It’s risky, but the question is if the risk/reward ratio is better or worse than the alternatives. In the case of TSLA, you’d have made well over 10x your money if you had bought in 2019. It’s why bubbles keep happening despite everyone knowing they exist and will pop eventually.

      • @[email protected]
        1•3 days ago

        All of that, plus an additional bit of irrationally, since SpaceX is private, some investors are in Tesla with the idea that some future corporate action will cause Tesla shares to eventually include SpaceX ownership as well.

    • @captainlezbian
      15•4 days ago

      I subscr to the theory that Tesla is valued not as an automotive stock but as a tech stock. Companies like Toyota and VW are valued wildly different from companies like Google and Amazon and tesla has long pushed for everyone to think of it as far more like apple than like Honda, with quite a bit of success. That’s why Elon does his whole Tony stark/Steve jobs routine and swears full self driving and other revolutionary tech. Because otherwise you have to look at his vehicles as the gilded Yugos they are that do have some really great aspects, but ones that are now being done by companies like Hyundai that can actually assemble a car well

    • @[email protected]
      15•4 days ago

      Thank you for explaining it so well. I thought that was what it was, but it seems insane to be valued that much higher to investors. Turns out, it probably is insane.

      • idunnololz
        10•4 days ago

        And remember if you want to try to cash in on this information “Markets can remain irrational longer than you can remain solvent”