UBS warned of a sharp decline in Tesla deliveries and concerns over robotaxis

Analysts at UBS have worsened their forecast for Tesla's electric car deliveries in the first quarter, Business Insider reports. They believe that falling sales in the core business, coupled with intensifying competition in the robotaxi segment, which is considered the main driver of the company's growth, will intensify investors' concerns. This will be a new blow to Tesla's shares, which have already had to deal with high volatility over the past 18 months, emphasizes Business Insider.

UBS strategist Joseph Spark has worsened his forecast for Tesla's electric car shipments and expects an 18% drop in first-quarter deliveries compared to the last quarter of last year - to 345,000 cars, TipRanks writes. Previously, UBS was counting on 360,000 electric cars. The new estimate is 7% below the consensus forecast by Visible Alpha. At the same time, Spark does not rule out that the real numbers could be even worse, unless the traditional "spurt" at the end of the quarter corrects the situation. Tesla will release delivery figures in the coming weeks, Business Insider points out.

The analyst notes that the focus of investors has recently shifted from Tesla's car business to robotaxis and AI, but there are growing concerns in this area as well. Market participants increasingly doubt the company's ability to maintain its leadership, says UBS. The reason for skepticism was the launch of Nvidia Alpamayo, a next-generation open AI platform that allows any automaker to train cars to "reason" and explain their actions on the road. At the same time, Alphabet subsidiary Waymo is successfully scaling its business: its unmanned cab service is already operating in 10 major U.S. cities, including Los Angeles and Miami, and plans to reach the level of 1 million trips per week.

Recent investor feedback, according to Spark, shows that updates to Robotaxi and Optimus - two of Musk's most ambitious projects to turn Tesla into an AI and robotics giant - are coming out slower or appearing more subdued than expected.

At the same time, although the volume of electric car deliveries does not affect the quotes as much as it used to, they remain critical, the analyst explains. It is the automobile business that generates the main cash flow needed to finance Tesla's capital expenditures, which this year should amount to $20 billion. Thus, the slowdown in electric car sales directly hits Tesla's ability to invest in development. An additional negative signal was Musk's statement, which again postponed the release of the long-awaited "supercar of the future" Tesla Roadster, promising to present it later this year, Business Insider points out.

UBS confirmed the recommendation to sell Tesla shares, which have fallen by 17% since the beginning of the year. The set target price of $352 suggests the possibility of further decline in quotations by another 7.5% from the closing level on March 19. At the premarket on March 20, the securities were falling by 0.5%.

Other Wall Street analysts are moderately optimistic about the company's securities. According to MarketWatch, 26 analysts recommend to buy securities, 22 - to hold and eight - advise to sell.

This article was AI-translated and verified by a human editor