ii view: tax credits drive Tesla deliveries to new high
More than just a car maker, analyst Keith Bowman looks at prospects for this Magnificent Seven company.
3rd October 2025 11:26
by Keith Bowman from interactive investor
Third-quarter deliveries and production to 30 September
- Deliveries of 497,099 vehicles, up from 384,122 in the previous quarter
- Total production of 447,450 vehicles, up from 410,244 vehicles in the previous quarter
ii round-up:
Tesla Inc (NASDAQ:TSLA) has detailed record quarterly vehicle deliveries, the nearest number it gives to sales. The figure beat Wall Street forecasts, likely driven by demand for a US government $7,500 tax credit discount before the scheme ends in October.
Third-quarter deliveries of 497,099 vehicles was up from 384,122 in the previous quarter, comfortably surpassing analysts' expectations of around 475,000 vehicles. Tesla production of 447,450 vehicles was an increase from 410,244 in the second quarter.
Shares in the Nasdaq 100 company fell 5% yesterday but were higher in pre-market trade having come into this latest announcement up around 8% so far in 2025. That’s similar to rivals General Motors Co (NYSE:GM) and Bayerische Motoren Werke AG (XETRA:BMW). The Nasdaq 100 index is up by close to a fifth year-to-date.
- Invest with ii: Buy US Stocks from UK | Most-traded US Stocks | Cashback Offers
As well as electric vehicles (EVs), Tesla products and interests include self-driving software, the development of a so-called robotaxis, solar panels and energy storage systems, and humanoid robots.
Energy storage system deployment also hit a record during the quarter, totalling 12.5 GigaWatt hours (GWh), up from 9.6 GWh in the prior second quarter. Wall Street had forecast 10.94 GWh.
Broker Morgan Stanley reiterated its ‘overweight’ stance on the shares post the update. Third-quarter results are scheduled for 22 October.
ii view:
Started in 2003, by Martin Eberhard and Marc Tarpenning, today the Elon Musk headed company operates two factories in the US as well as plants in Germany and China. Geographically, the US dominated in 2024 with close to half of all sales, followed by China at just over a fifth, and other markets including the UK accounting for the balance of close to a third. Tesla’s stock market value of close to $1.5 trillion compares to rivals such as Ford Motor Co (NYSE:F) at $49 billion and Volkswagen AG (XETRA:VOW) at $48 billion.
For investors, rivals like Mercedes-Benz Group AG (XETRA:MBG), Toyota and BMW are all now actively pushing their own EV and hybrid models, with rivals from China such as BYD particularly competitive on price. US imposed import trade tariffs now potentially raise costs given overseas component suppliers. Elon Musk’s venture into politics is likely to have deterred some potential future customers, while a forecast price-to-net asset value (NAV) of around 19 times compares to estimates for rivals at under two times, suggesting the shares are not obviously cheap.
- Equity boom delivers shock result in September
- Stockwatch: four key reasons this bull market could continue
- Watch our video: why we’re upping exposure to US shares
More favourably, Elon Musk continues to describe Tesla as a technology company with developments of self-driving AI fuelled software, a robotaxi, and humanoid robots all potentially generating significant profits. Innovation in manufacturing techniques including casting one major bodywork item instead of welding many together are reducing costs. The number of income generating supercharger stations globally continues to rise, while concerns about climate change have not gone away.
In all, some caution remains sensible, with Wall Street forecasting vehicle deliveries for the current 2025 financial year of around 1.61 million, down 10% from 2024. It is also difficult to predict the behaviour of CEO Elon Musk. That said, Tesla’s ability for innovation cannot be dismissed, with self-drive vehicles and robots likely to keep investors interested.
Positives:
- Climate change concerns persist
- Expanding network of superfast charging stations
Negatives:
- Rising competition from other manufacturers
- Potential regulatory hurdles for self-driving vehicles
The average rating of stock market analysts:
Strong hold
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.