Tesla delivers record number of vehicles, cuts prices by US$2,000

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For the Model 3, that amounts to an average rate of 4,722 vehicles per week over the quarter-a fair amount below the 5,000/week rate that Tesla CEO Elon Musk said would be required to make the auto profitable in 2018. The move will partly offset the expiration of a $7,500 federal tax credit for electric vehicle purchases that will be phased out this year.

The Palo Alto, California, company's 2018 sales included nearly 146,000 Model 3 lower-priced cars and another 99,000 of the more expensive Model S sedan and Model X SUV.

Tesla delivered 63,150 Model 3s in the quarter, falling short of FactSet estimates of 64,900. But deliveries of the Model 3 sedan, Tesla's cheapest vehicle, were less than expected.

Tesla Inc TSLA.O shares fell 9 percent on Wednesday after the electric auto maker delivered fewer-than-expected Model 3 sedans in the fourth quarter and cut prices for all its vehicles in the United States to offset a reduction in a green tax credit. Craig Irwin, an analyst with Roth Capital Partners, noted that Tesla's price adjustments on its vehicles are not helping TSLA stock either.

The company also announced on Wednesday that it was cutting the price of its Model S, Model X and Model 3 vehicles by $2,000 in the US.

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The electric vehicle maker's shares fell by as much as 10.2 percent in morning trading Wednesday. The deliveries are below our estimates and the consensus estimates.

Deliveries exceeded production across both of Tesla's model lines, but the company didn't clarify whether that serves as evidence of the improvement. The company also told investors in late October that it took less time to build than the Model S sedan and Model X sport utility vehicle - another first for the company. That was cut in half, to $3,750, starting January 1.

In its previous results statement, the company promised to focus on increasing its production rate.

Total deliveries rose from the third quarter to 90,700 cars, but missed forecasts, which had been influenced by analysts' expectations of a surge in buyers looking to cash in on the tax credit before year-end.

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