Tesla’s Sales Drop Concerns Investors

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Tesla is struggling to circulate more of its cars, and Wall Street is taking notice.

According to Bloomberg, the electric car maker reported a decline in deliveries of its Model 3 sedan. In the first three months of the year, the auto delivered 63,000 vehicles, less than the 90,966 it sold in fourth quarter 2018. It is believed that the declines were caused by a reduction in tax incentives for electric cars in the US and production delays in Europe and China. All are key markets for Tesla.

It’s Model S and X vehicles also saw declines in deliveries.

Tesla’s stock fell 8.5% in premarket trading. As of 7:20 am Thursday, its stock was trading at $291.81, up more than 2%.

“We’re past peak Tesla,” said David Kudla, CEO of Mainstay Capital Management, to Bloomberg. “There’s slowing demand for the Model 3 and there’s nothing else immediately in the pipeline.”

“It’s a disappointment. There’s no way around that,” added Gene Munster, managing partner of venture capital firm Loup Ventures to Bloomberg. “The big question is, what is demand?”

Tesla has been trying to address its issues by kicking in production on its lesser priced Model 3 option, but there is no data on how those autos sold as production started a few weeks ago.

Investors have been keeping a close watch on Tesla not just because of disappointing deliveries, but also SEC actions to the company due to founder Elon Musk’s tweeting about company performance, job cuts, pricing issues and senior executives leaving the company.