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Tesla set to post strong deliveries after production spurt


© Reuters. FILE PHOTO – A Tesla Model X electric vehicle is seen at Brussels Motor Show (Belgium), January 9, 2020. REUTERS/Francois Lenoir/File Photo

By Aniruddha Ghosh

(Reuters) – Wall Street analysts gave upbeat estimates for Tesla (NASDAQ:)’s quarterly vehicle deliveries on Tuesday, with one research group predicting it to be the best quarter for the company even as the auto sector wrestles with an unprecedented shortage of parts.

In a memo to employees earlier in the month, Elon Musk had mentioned an unusually large end-of-quarter delivery wave. He asked them to work hard to overcome production problems in the first quarter.

Analysts at Piper Sandler and RBC raised their estimates to about 233,000 vehicle deliveries for the third quarter ending Sept. 30, while Credit Suisse (SIX:)’s estimate was 225,000-230,000.

These figures are a 67% to 67% increase over the previous year. According to Visible Alpha data, market data provider Visible Alpha, an average of 222,700 Tesla vehicles was expected for the third quarter.

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According to analysts, the effect of the global shortage in semiconductors, which has impacted many carmakers worldwide, might have had a smaller impact on Tesla.

Credit Suisse’s Dan Levy stated that Tesla appeared to be less affected by the global semiconductor shortage than other automakers. He cited Tesla’s “quick pivot” to microcontrollers, and its ability to write its own software.

Piper Sandler’s Alexander Potter indicated that Tesla’s third quarter is likely to be the “strongest” yet. He cited increasing adoption in Europe, China and Tesla’s market share. Refinitiv Eikon rates Potter five stars for his estimates and recommendations about Tesla.

Potter increased his estimate for annual deliveries from 846,000 to 894,000. This would almost double the 499,550 deliveries last year.

China has become a significant source for global Tesla exports. Credit Suisse’s Levy indicated that its Shanghai plant had likely exported approximately 55,000 Tesla vehicles between July and August. This is an increase of roughly 30% from the second quarter’s 30,000.

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