Announcing its production and delivery numbers for the second quarter of 2023, Tesla posted a new record, beating analysts’ predictions. The company is well on track to achieve its annual goal of deliveries by the end of the year, meaning it would globally outperform Audi. But over in China, BYD is in a fierce fight with Tesla.

There was no doubt among analysts that Tesla would set a good performance as the lowering of its prices and the successful ramp-up at the factories in Texas and Germany took effect. But with 466 140 vehicles delivered during Q2, the American EV maker beat predictions again, which agreed upon 448 000 units, and grew by 86% in a year-over-year comparison. Tesla slashed its previous quarter record (Q1: 422 000 units) by more than 44 000 cars.

Fear of inventory problems

No surprise that the bulk of these deliveries come from the Model 3 and the Model Y, which account for 446 915 units or 96%, while the bigger Model S and X managed 19 225 units. During the final quarter of this year, Tesla is poised to release the successor to the Model 3, which reportedly could be equipped with an innovative LFP battery pack from CATL. This should lead to higher efficiency and drive further down cost, boosting Tesla’s price strategy.

With the year half through its paces, Tesla has delivered 888 000 cars, which means it needs to shift a little less than a million to meet its target of 1,8 million units. In 2022, the brand delivered 1,3 million units. Fear was growing that the brand was building up an inventory of unsold vehicles, but that situation seemed more or less under control.

Free charging as a magnet

As competition is growing and the Chinese economy falters, Tesla has been slashing its prices continuously this year, causing competitor brands to rethink their strategies to gain market share. As an incentive, American customers were lured in with the promise of free fast charging during the first three months, while Musk also decided to try classic advertising as a marketing tool.

In late 2022, the price cuts started in China but were soon followed in the US and the rest of the globe by the start of 2023. The compact models received reductions between 1 000 to 2 000 euros. But pricing has already been adapted three times this year for the bigger Model Y and Model X. The biggest bonus was in April when the pricing of the big Teslas sank by 5 000 euros.

Over in China, BYD is catching up with Tesla at neck-breaking speed. The company, which took over from VW as China’s best-selling carmaker this year, doubled its deliveries of electric vehicles during Q2 in a year-over-year comparison.