TSLA Tesla Inc

By Tim Higgins and Dave Sebastian 

Tesla Inc. delivered 112,000 electric vehicles in the final three months of last year, enough to meet Chief Executive Elon Musk's ambitious growth goal for 2019.

All totaled, Tesla delivered 367,500 vehicles in the year against a target of handing over at least 360,000 cars and sport-utility vehicles.

The full-year figure represents a 50% increase from 2018. It punctuates the dramatic rise in output Tesla has achieved from 2016, when the Silicon Valley auto maker revealed the mass-market Model 3. The car was the centerpiece of Mr. Musk's bet that he could transform the electric-car maker from niche luxury player into a more mainstream car company.

Fourth-quarter deliveries rose 23% from a year earlier and beat analyst expectations for 106,000 vehicles.

Sales of the Model 3 fueled the year's growth. Deliveries of the Model 3 continued upward momentum from the third to the fourth quarter, rising 16% to 92,500 in the final three months. That was a 47% increase from the final quarter of 2018.

Mr. Musk's 2019 target of delivering between 360,000 and 400,000 vehicles represented a step down from loftier ambitions pronounced earlier. Mr. Musk had once promised to make 500,000 in 2018, with Tesla reaching the one million vehicles level in 2020.

Tesla won't disclose for several weeks how much money it made on the cars it delivered in the fourth quarter. Analysts surveyed by FactSet, on average, expect a profit for the most recent quarter, though they project that Tesla will remain in the red for all of 2019.

Vehicle deliveries are set to increase again this year, in part bolstered by the Model Y compact SUV that should start going to customers. Analysts estimate the company will deliver around 463,000 vehicles during the year.

Separately, Tesla has lowered the starting price of its China-made Model 3 vehicles by 9% after the car maker earlier this week said it has hit its early production target of 1,000 vehicles a week at its China plant.

The company now sells the vehicles for 323,800 yuan ($46,445), according to Tesla's Chinese website. It was previously priced at 355,800 yuan.

The actual selling price of the model starts at 299,050 yuan after accounting for government subsidies for new-energy vehicles, Tesla said.

Tesla will start delivering the Model 3 cars made in its 210-acre Shanghai site to customers on Jan. 7.

Producing cars locally for the Chinese market allows Tesla to cut back on shipping costs and avoid import duties.

Gigafactory Shanghai is the first wholly foreign-owned car plant in China, which is liberalizing its rules about foreign investment in the automotive industry.

--Martin Mou contributed to this article.

Write to Tim Higgins at Tim.Higgins@WSJ.com and Dave Sebastian at dave.sebastian@wsj.com

(END) Dow Jones Newswires

January 03, 2020 09:08 ET (14:08 GMT)

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