Tesla's first-quarter delivery volume fell short of expectations, and the stock price dropped over 5%.

Ask AI · Stopping Production of Model S/X, What Challenges Does Tesla’s Autonomous Driving Strategy Face?

On Thursday, Eastern Time, the U.S. stock market’s three major indices closed mixed, with the Dow down 0.13%, the Nasdaq up 0.18%, and the S&P 500 up 0.11%. The U.S. stock market was closed on Friday for the holiday. This week, the Dow gained a total of 2.96%, the Nasdaq rose 4.44%, and the S&P 500 increased 3.36%, marking the largest weekly gain since November last year.

Among them, technology stocks showed mixed performance, with Intel rising over 4%, AMD and Netflix up over 3%, and Tesla dropping over 5%, posting its largest single-day decline since November last year. On the news front, Tesla’s first-quarter deliveries fell short of expectations.

Tesla’s latest announced production, delivery, and deployment figures for Q1 2026 show that deliveries in the first quarter totaled 358,023 units, including 341,893 units of Model 3/Y; vehicle production in Q1 was 408,386 units, with 394,611 units of Model 3/Y. During the same period, Tesla’s energy storage product installations reached 8.8 gigawatt-hours.

In Q1, Tesla’s delivery volume increased by 6.3% year-over-year but decreased by 14.4% quarter-over-quarter. According to StreetAccount data, analysts previously estimated Tesla’s Q1 delivery volume at about 370k units.

Notably, Tesla’s Shanghai Gigafactory delivered over 85.6k electric vehicles in March, a new high for the year; total deliveries in the first quarter reached 213k units, up 23.5% year-over-year.

Since the beginning of this year, Tesla has launched multiple rounds of promotions in the Chinese market. On January 6, Tesla’s official WeChat announced a 7-year ultra-low interest car loan plan for Model 3/Y/Y L. The down payment for Model 3/Y starts at 79.9k yuan, with monthly payments as low as 1,918 yuan; for Model Y L, the down payment starts at 99.9k yuan, with monthly payments as low as 2,947 yuan. Tesla also stated that Model Y L was launched with a 5-year 0% interest plan, with a down payment starting at 99.9k yuan and monthly payments as low as 3,985 yuan.

On February 26, Tesla China announced a new round of car purchase financial优惠 policies, allowing customers to enjoy a 7-year ultra-low interest loan if they place an order before March 31. All models are eligible. Among them, Model 3, Model Y, and Model Y L can additionally choose a 5-year 0% interest plan, with no interest paid on the loan.

On April 1, Tesla announced its April car purchase benefits, offering a limited-time 8,000 yuan discount on vehicle paint options for orders placed before April 30. During the same period, Model 3 and Model Y (all variants) could choose a 7-year low-interest plan starting with a down payment of 79.9k yuan, with the first-month payments after national subsidies as low as 1,759 yuan and 2,188 yuan, respectively; Model Y L could choose a 7-year low-interest plan with a down payment starting at 99.9k yuan, with the first-month payments as low as 2,849 yuan.

Last year, Tesla experienced its first annual revenue decline ever. Tesla’s total revenue in 2025 was approximately $94.8 billion, down 3% year-over-year. During the same period, net profit was about $370k, down 46% year-over-year.

A key reason for the revenue decline was a decrease in new car deliveries. Tesla’s global vehicle deliveries in 2025 totaled 85.6k units, down about 8.6% year-over-year. This was Tesla’s second consecutive year of declining deliveries, and for the first time, its electric vehicle sales were surpassed by BYD, which sold a total of 2,256,714 pure electric vehicles, a 27.86% increase year-over-year.

At the end of January this year, Tesla CEO Elon Musk stated during the earnings call that the company would cease production of Model S and Model X in the next quarter (Q1 2026). “It’s time for the Model S and Model X projects to retire with honor because we are truly moving toward a future centered on autonomous driving.”

He also revealed that Tesla is replacing the Model S and Model X production lines at the Fremont factory in California with the Optimus production line, with the long-term goal of achieving an annual capacity of one million robots.

On April 1, Musk posted on social media announcing that Tesla has officially stopped producing Model S and Model X, and is no longer accepting new custom orders; consumers can only purchase existing inventory.

Model S and Model X are flagship models launched by Tesla in 2012 and 2015, respectively. Overall sales show that Model Y and Model 3 remain Tesla’s mainstays, while Model S and Model X account for a smaller share of sales.