Tesla Stock Slides 5% Despite Record Q3 Deliveries
Investors signal concern that the expiring federal EV tax credit created a 'pull-forward' of demand, raising questions about future growth.
Tesla (TSLA) shares fell more than 5% in recent trading, a surprising downturn that came just after the electric vehicle giant announced record-breaking third-quarter deliveries. The negative market reaction highlights investor anxiety that a rush to capitalize on an expiring U.S. federal EV tax credit may have artificially inflated the sales figures, potentially setting the stage for a slowdown in the coming months.
The automaker reported it delivered 497,099 vehicles in Q3, a new company record that surpassed most Wall Street estimates. However, the strong performance was overshadowed by the end of the long-standing clean vehicle subsidy. This has led to a prevailing theory that the impressive numbers were the result of a 'pull-forward' effect, where consumers accelerated their purchases to receive the credit before it disappeared on September 30.
This sentiment was echoed by market analysts who, while acknowledging the strong quarter, expressed caution about the road ahead. Wedbush's Dan Ives noted it was a "great bounce back quarter" for Tesla but warned that "EV demand is expected to fall with the EV tax credit expiration." The core concern is whether the organic demand for EVs, which carry a higher average price tag than gasoline-powered cars, is robust enough to sustain momentum without the significant government incentive.
, which provided up to $7,500 for new vehicles, was a key driver of EV adoption for 15 years before its recent termination. The phenomenon wasn't isolated to Tesla; other automakers, including Ford and General Motors, also reported a surge in EV sales as the deadline approached, indicating an industry-wide rush.
In response to the subsidy's expiration, , including offering new lease credits to soften the financial blow for consumers. While this may help cushion demand, it could also introduce new pressure on the company's closely watched profit margins. For investors, the focus now shifts to the fourth quarter, which will serve as the first major test of Tesla's ability to maintain its high-growth trajectory in a post-subsidy U.S. market.