Tesla records single biggest drop in sales of its electric vehicles

The first three months of 2019 saw a 31% drop in vehicles delivered to customers as compared to the previous quarter

Tesla has reported a significantly large drop in auto sales for the last quarter as the first three months of 2019 saw about 63,000 vehicles delivered to the customers, which is a 31% drop as compared to the previous quarter.

The total sales figures comprised of about 50,900 units of its bestselling vehicle, Model 3 sedans and 12,100 units of luxury Model S sedans and Model X SUVs. In nearly two years, it was the first subsequent quarter drop in sales at Tesla and the single biggest drop ever, reliable sources informed.

According to the analysts at Wall Street, they expected deliveries and sales of the Model 3 to be around 50,000 and Tesla had stated before that it expected Model X and Model S deliveries to be lower than a year earlier.

Seemingly, the overall last quarter sales were still notably larger than first quarter of 2018, when the production of Model 3 was just being started. During that quarter, the company had sold less than 30,000 units.

Recently, Tesla said that U.S. orders for Model 3 vehicles were surpassing deliveries significantly, which means there is still great demand for its vehicles. The company strongly affirmed its prior guidance of 360,000 to 400,000 vehicle deliveries in 2019.

Sources said there are two key circumstances that are responsible for the decline in sales. Firstly, before the end of the last year, the company ran to complete some sales so that buyers could take the benefit of $7,500 federal tax credit, which lessens the amount people had to pay for the vehicles of Tesla.

That tax credit has been reduced by half for sales completed in 2019 which could make Tesla cars harder to sell to budget-conscious customers. Secondly, in the first quarter, the company started shipping its Model 3 to Europe and China for the very first time and the new move had become a logistic challenge for Tesla.