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(Sharecast News) - Tesla reported a decline in annual deliveries for the first time in its history on Thursday, delivering 1.79 million vehicles in 2024 compared to 1.81 million in 2023.
Fourth-quarter deliveries reached 495,570, falling short of analysts' expectations, which ranged from 501,000 to 506,763.
Shares in the electric car giant dropped by as much as 7% following the announcement.
The company's annual production of 1.77 million vehicles narrowly missed its delivery total, indicating an accumulation of inventory.
Despite price cuts and incentives, Tesla faced slowing growth, increased competition, and operational challenges.
Tesla's stock saw a dramatic recovery in 2024, ending the year up 63% after a dismal first quarter when it fell 29%.
Chief executive officer Elon Musk had warned earlier in the year of slower growth rates, a prediction borne out as competition intensified.
Hyundai, BYD, and other EV manufacturers continued to gain market share globally, particularly in Europe and China, where Tesla saw sales decline.
Registrations in Europe dropped 14% through November, and Tesla's growth in China lagged behind the broader EV market.
Musk's political involvement in the US presidential election and his advisory role to the incoming Trump administration also drew criticism, with some analysts quoted by CNBC suggesting it may have diverted his attention from Tesla's core operations.
The company did remain dominant in North America, however, thanks to aggressive price cuts and incentives.
Tesla also faced operational challenges, including managing inventory levels of its high-profile Cybertruck.
Initially hailed as a breakthrough, the vehicle had struggled to gain traction since its launch, with used models reportedly piling up on car lots.
Analysts attributed some of Tesla's struggles to a lack of affordable EV offerings in 2024, allowing competitors to gain ground.
Looking ahead, Musk projected 20% to 30% growth in 2025, driven by plans to introduce lower-cost and autonomous vehicles.
At 1123 EST (1623 GMT), shares in Tesla were down 5.88% on the Nasdaq at $380.10.
Reporting by Josh White for Sharecast.com.