Tesla Inc (NASDAQ: TSLA) shares dropped 9% on Monday after the electric automaker announced that it delivered fewer than anticipated cars in Q3 because of logistic challenges as the slowing economic growth outlook raised demand concerns.
Tesla made record deliveries but missed expectations
The company came short of market expectations with an exceptionally massive difference between cars produced and those delivered even though it reported record deliveries in the quarter. The shortfall was a result of the failure to procure affordable transport during the time.
In addition, the shortage in delivery coincides with analyst and investor concerns about demand in light of rising Tesla car pricing, increasing borrowing costs, and a gloomy prognosis for the world’s economic growth. As a result, analysts have warned that in the coming quarters, demand for cars may decline.
JP Morgan analyst Ryan Brinkman said:
“While Tesla continues to point to supply constraints as limiting deliveries, the potential for demand destruction looms large.”
In the fourth quarter, Tesla expects to deliver over 450,000 cars to maintain the target of growing car deliveries by 50% per year. For the period, the electric car maker plans to manufacture approximately 495,000 Model 3 and Model Y cars.
Cathie Wood purchased Tesla shares as they dipped on Monday.
Cathie Wood acquired Tesla shares after they dropped the highest in four months after Q3 deliveries miss. Wood’s Ark Investment Management LLC-backed funds have acquired 132,213 Tesla shares, which is the company’s first purchases since mid-June. The acquisition is Wood’s second in the electric carmaker this year. In June she acquired the first stake after Tesla lost the crown jewel position in her fund, a status it held for almost four and half years.
The most recent purchases provide more proof that Wood is once again going on a dip-buying spree. According to Bloomberg data, Ark has sold Tesla stock for a record five consecutive quarters until the end of June.
The Ark Next Generation Internet ETF and Ark Innovation ETF made the purchases on Monday. As growth equities are hurt by past Federal Reserve compression and concerns about a worldwide downturn, Ark’s primary ETF has fallen 60% in 2022.