Posted on June 22, 2023
Tesla's new vehicle inventory in the US has hit a low not seen since the start of the company's discounts, signaling a successful inventory liquidation in time for the end of the financial quarter. This is according to individual inventory checks which show markedly fewer vehicles available compared to the previous month.
Unlike other car manufacturers, Tesla handles its inventory differently due to its direct-to-consumer model. The company cannot sell its inventory to third-party franchise dealerships, instead, it can only record revenue from vehicles once customers have taken delivery. As a result, Tesla must deliver all its vehicles to customers by the end of the quarter to prevent any negative impact on its quarterly financials.
In previous quarters, Tesla has engaged in end-of-quarter delivery pushes to meet this requirement. While the practice has slowed down in recent times, new inventory vehicles reached new highs earlier this quarter. This led Tesla to offer new discounts on existing inventory vehicles compared to new orders for the first time.
Over the past week, the company's new vehicle inventory in the US has seen a significant drop, indicating that the discounts have had the desired effect. A check of Tesla's new inventory in major markets such as Los Angeles, New York, and San Francisco shows significantly lower inventory levels, in line with the data.
With a little over a week left in the quarter, it seems that Tesla is on track to nearly exhaust its entire inventory.
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