Tesla Inc. reported on Thursday that it manufactured 408,386 vehicles in the first quarter of 2026 but delivered only 358,023, falling short of analyst expectations.
Prior consensus estimates, released by the company ahead of the announcement, had projected deliveries of approximately 365,645 vehicles.
Breaking down the figures, Tesla produced 394,611 units of its Model 3 and Model Y vehicles and delivered 341,893.
Additionally, the company deployed 8.8 GWh of energy storage products during the quarter.
Following the announcement, Tesla’s shares plunged around 4% in early trading.
Q1 performance shows mixed results for Tesla
The delivery count for the January-March period represented a 14.4% decline from the fourth quarter of 2025 but a 6.3% increase compared with the same period last year.
Analysts tracking Tesla had expected an average of 368,903 vehicles delivered, according to Visible Alpha data.
Tesla is facing a rare period of declining deliveries, marking the second consecutive year of lower annual deliveries in its history.
Some analysts have adjusted their forecasts for 2026, warning that a third consecutive drop is possible.
Tesla faces rising global competition
Last year, Tesla lost its position as the world’s largest electric vehicle maker to China’s BYD.
In Europe, Tesla’s global performance was weighed down by softer demand, though the company has shown signs of recovery, particularly in key markets such as France during the first quarter of 2026.
In France, registrations reached 9,569 vehicles, up 203% year-on-year.
This was just below the record of 9,572 units recorded in December 2023. Overall, car sales in France also increased for the first time since October.
In China, Tesla’s locally manufactured EV sales grew for a second consecutive quarter, rising 23.5% year-on-year in Q1 2026, up from just a 1.9% increase in Q4 2025.
Impact of US Tax Credit expiry
The expiration of the $7,500 federal tax credit for EV purchases at the end of September 2025 has hit US demand, removing a significant incentive for buyers.
Analysts expect this to continue to dampen EV sales this year, adding to pressure from increasing competition both in the US and Europe.
While quarterly deliveries remain critical, Wall Street is increasingly focused on Tesla’s long-term ambitions.
CEO Elon Musk has been steering the company into solar energy, humanoid robotics, and autonomous taxis.
Tesla’s long-term vision: Robotaxis and Cybercab
In June, Tesla launched a limited robotaxi service in Austin, Texas, with plans for rapid expansion in 2026 after removing safety monitors in January.
Tesla’s Cybercab, a purpose-built autonomous two-seater, is expected to enter ramped production this year.
However, Tesla’s robotaxi presence remains limited, confined to Austin and a San Francisco ride-hailing service, significantly smaller than Waymo’s nationwide commercial rollout.
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