All is not well in Tesla Inc. (NASDAQ:TSLA), as it is suffering from setbacks one after another. It all started with the quarterly delivery reports where the carmaker announced fewer-than-expected deliveries for the second quarter, resulting in Tesla stock reducing more than 15%. This was followed by the safety report from IIHS, which said that Model S is not the safest car in the world.
Now Tesla has suffered another major setback, this time in California, as the registrations in the state fell 24% in April as compared to a year ago. According to Reuters, California is one of the most lucrative markets for the car company, and registrations going down meant that there would be more pressure on the company to increase its market share in the coming years.
While the second-quarter deliveries for Tesla increased on a year-over-year basis, there was a decline in shipments by 13% on a quarter-over-quarter basis. Data from IHS Markit revealed that registrations dropped in April as analyst Stephanie Brinley said that a single month's data is not enough to explain the overall demand.
However, Stephanie cautioned that the company needs to refresh its line-up, specifically the Model S - the flagship product for Tesla. Model S sales have taken a hit. Thus some change in the vehicle or its new version with an exterior change might revive the interest of the people. Tesla currently provides changes to the software over-the-air updates, but for the exterior, there has been no change in the vehicle.
The Model S registrations in California were uneven during the first four months of 2017 where they peaked in February. Growth in registrations turned negative in April, raising concerns over the performance of Tesla and its electric vehicle in a state that is said to be a heaven for the electric cars.