480,000 vehicles! Tesla, Inc. (TSLA.US) Q2 delivery volume increased by 25% year-on-year, far exceeding expectations. European demand rebounded and the low-price strategy paid off.

Tesla, Inc. (TSLA.US) announced its second-quarter delivery data on Thursday, with deliveries reaching 480,126 vehicles, a 25% increase compared to the same period last year, far exceeding market expectations. Boosted by significant recovery in European demand and a strategy of offering lower-priced models, this report temporarily overshadowed controversies surrounding Elon Musk, the reduction of U.S. subsidies, and increased market competition. However, the market's focus has shifted towards its new businesses such as artificial intelligence (AI) and Siasun Robot & Automation, as the stock price has still fallen by over 5% since the beginning of the year. According to the data released by Tesla, Inc. on Thursday, global deliveries in the second quarter of this year (April-June) reached 480,126 vehicles, a significant increase of about 25% compared to the approximately 384,000 vehicles delivered in the same period last year, and a sharp increase from the 358,023 vehicles delivered in the first quarter. This number not only easily surpassed Wall Street analysts' general expectations of 402,776 vehicles, but also exceeded Tesla, Inc.'s own compiled consensus of 406,024 vehicles. The entry-level Model 3 and Model Y continued to be the main focus, with a total of 467,762 deliveries. Production during this period reached 451,758 vehicles. The primary driver behind the strong rebound in deliveries came from Europe. After experiencing a damaged brand image and plummeting sales last year due to Musk's personal political activities, Tesla, Inc. has shown signs of recovery in key European markets. Additionally, amid the background of the U.S.-Iran conflict, the situation in Iran briefly boosted gasoline prices and consumer willingness to purchase electric vehicles in Europe. However, with recent oil prices falling back to pre-war levels, this positive factor is fading. Offsetting multiple headwinds with a low-price strategy Tesla, Inc. is working hard to overcome the challenges of consecutive years of declining sales. In the United States, demand significantly declined after the federal electric vehicle tax credit of $7,500 expired in September last year. While there are signs of stabilization, consumers are overall shifting from pure electric vehicles to hybrid models. Dan Hirsch, managing director of consulting firm AlixPartners, pointed out that the vast expanse of the U.S., the incomplete charging infrastructure compared to Europe, and the longer driving distances have affected the acceptance of electric vehicles. At the same time, Musk's controversial political comments, support for extreme anti-immigrant groups in Europe, and actions such as supporting the Trump administration's reduction of federal employees have continuously discouraged potential buyers. In China and global markets, competition from manufacturers such as BYD Company Limited (01211) offering high-value, high-tech electric vehicles, as well as competition from traditional automakers like Hyundai Motor Group and Volkswagen (VWAGY.US), have also put significant pressure on Tesla, Inc. To turn the situation around, Tesla, Inc. has taken several measures: launching lower-priced versions of the Model 3 and Model Y; expanding its "full self-driving (supervised edition)" assisted driving system to certain European markets and expecting to expand coverage in the coming months to support demand; in China, the production of the redesigned Model Y has also helped boost sales. Accelerated layout in AI, autonomous driving, Siasun Robot & Automation business, with a sharp increase in expenditure While car sales remain Tesla, Inc.'s largest source of revenue, Wall Street's evaluation logic is quickly moving beyond quarterly delivery numbers to focus on Musk's grand vision of AI, autonomous driving, and humanoid Siasun Robot & Automation. The company's current valuation of about $1.6 trillion largely depends on these long-term businesses. The rapid expansion of capital expenditure also confirms this shift. Tesla, Inc. plans to spend over $250 billion this year, about three times last year's expenditure, to expand factory production of Optimus humanoid Siasun Robot & Automation and dedicated self-driving rental cars Cybercab without pedals or steering wheels. In January of this year, Tesla, Inc. announced the discontinuation of flagship models Model S and Model X, using the production line at the Fremont, California factory to manufacture Optimus. In terms of autonomous driving, the company launched a limited Robotaxi commercial service in Austin in June and plans to ramp up Cybercab production later this year to expand service scale rapidly by 2026. Musk has also instructed the company to increase production and sales of the Semi electric truck. It is worth noting that SpaceX (SPCX.US), which completed a record-breaking initial public offering last month, purchased a $269 million Megapack energy storage system from Tesla, Inc. in April for cost reduction in its high-energy data centers in the Memphis area. In the second quarter, Tesla, Inc.'s energy business deployed 13.5 gigawatt-hours of energy storage, exceeding the market's expectation of 13.3 gigawatt-hours and slightly higher than the 9.6 gigawatt-hours deployed in the same period last year. Following the release of better-than-expected delivery data, Tesla, Inc.'s stock price slightly rose at the opening on Thursday. However, as of the close of trading on Wednesday, the stock has accumulated a decline of over 5% so far this year, significantly underperforming the Nasdaq index, which has risen by about 12% during the same period, and the S&P 500 index, which has increased by more than 9%. Looking ahead to the second half of the year, inflation trends, changes in trade policies, and rising costs of key components such as chips may pose major challenges to U.S. automakers. Additionally, speculation about Musk possibly merging Tesla, Inc. with SpaceX is gaining momentum in the market, adding a new variable to the narrative of this leading electric vehicle company. Tesla, Inc. is set to release its complete quarterly financial report after the close of trading on July 22, allowing the market to further examine its profit situation and the latest developments in its various business lines.