Tesla reported fourth-quarter deliveries that surpassed analysts’ expectations, driven by an effort to accelerate shipments of Model 3 electric cars before certain variants of the compact sedan lose federal tax credits in the New Year under the Inflation Reduction Act (IRA).
As the world’s most valuable automaker, Tesla achieved a record-breaking number of vehicle deliveries in the fourth quarter, successfully meeting its 2023 target of 1.8 million units.
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The company delivered 484,507 vehicles in the last quarter of the year, surpassing estimates of 473,253 units based on a poll of 14 analysts by LSEG.
Notably, fourth-quarter deliveries marked an approximately 11% increase from the third quarter, which had faced production challenges due to upgrades to assembly lines for the updated Model 3 mass-market sedan.
Tesla’s delivery breakdown included 461,538 Model 3 cars and Model Y sports utility vehicles, with approximately 23,000 units of other models handed over.
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The conclusion of tax incentives for certain models was anticipated to prompt a shift in sales to the fourth quarter, impacting deliveries in the current year, as analysts had previously noted. Specifically, the rear-wheel drive and long-range variants of Tesla’s Model 3 compact sedan no longer qualify for federal tax credits of $7,500 in 2024 due to updated requirements on battery material sourcing under the IRA.