Tesla (NASDAQ: TSLA) stock is up 6% premarket on the back of the Q1 2023 vehicle production and delivery numbers. Price cuts earlier in the year clearly had an effect upon demand as we'd expect. The big question really is whether this is a general trend for the sector - rising EV sales overall - or whether Tesla is eating the lunch of the other manufacturers. We'll have to wait and see how that works out, when we get the numbers from those other manufacturers.
The specific numbers from Tesla were:
Tesla production and delivery numbers from Tesla.
That's 36.4% up from the same period in 2022 which is pretty good growth for a corporation of TSLA's size. There are also those saying this is below expectations. Tesla has a declared aim of growing sales by 50% this year and 36% in Q1 doesn't meet that goal. As so often with Tesla it's possible to find gloom about the silver linings and vice versa. Thus also the volatility of the stock, up and down through the day.
We can even note that BYD is growing EV sales 2.5 times faster than TSLA. From a much lower base, to be sure, but still, growth is growth.
The biggest issue here though concerns whether this is a Tesla specific growth in the market or a grand expansion of the market size itself? For that's what is going to end up defining the final size that Tesla can grow to. If EVs really do take over the world - in the way they have in Norway say - then Tesla has room to grow many times over again even as other companies enter the same market. Just as there are many volume ICE car makers so too can there be many EV of size assuming the whole market switches.
On the other hand if Tesla's increasing sales are at the cost of other market participants hen that might indicate that there's a natural size limit to the EV market. If that's true then there's obviously less room for TSLA to continue growing as Ford, VW and all the rest ready themselves to launch into the EV market in volume.
We don't know which way this is going to go but it is the TSLA question. Tesla is market dominant in EVs and likely to stay that way - but how large is the EV market going to be?