Tesla’s second-quarter sales drop amid supply chain issues and China pandemic restrictions

Tesla’s sales from April until the end of June fell to their lowest quarterly level since last fall as supply chain issues and pandemic restrictions in China hobbled production of its electric vehicles.

The company on Saturday disclosed it sold more than 254,000 cars and SUVs from April until the end of June, an 18 per cent drop from the first three months of this year and also well below the pace in last year’s final quarter.

The last time Tesla sold fewer vehicles globally was in the third quarter of 2021 when it delivered 241,000.

On Friday, the rest of the industry reported a 21 per cent drop in sales during the second quarter as the average price for vehicles skyrocketed to a record of US$45,844 amid soaring inflation, according to JD Power.

Tesla’s sales drop may be a harbinger of weaker second-quarter earnings for the Austin, Texas, company, which is the world’s top-seller of battery-powered vehicles and has posted net profits for nearly three years. Tesla plans to release its full results for the April-June period on July 20.

Like many other stocks, Tesla shares have been hard hit this year. But the 35 per cent decline in Tesla’s stock price has not been entirely tied to the company’s see-sawing fortunes.

Tesla CEO Elon Musk also has made a US$44 billion bid for Twitter, which he placed on hold after complaining that it has too many spam bot users who are not humans. Much of the erosion in Tesla’s value has occurred since Musk became Twitter’s largest shareholder and then launched a takeover bid that has raised concerns he has too much on his already crowded plate

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