The pace of Tesla's (NASDAQ: TSLA) deliveries fell in the second quarter of 2022, according to the company's most recent numbers for production and deliveries.
The company delivered 254,695 cars in the second quarter, falling just short of the 256,520 projected by experts on Wall Street. The figure is an 18% decrease from Tesla's deliveries in Q1, which came in at 310,048 vehicles. The drop in deliveries comes as supply lines remain dysfunctional worldwide, and as essential materials such as computer chips remain expensive and scattered in supply.
In contrast, Chinese EV maker Nio Inc (NYSE: NIO) posted record deliveries for its own second quarter. The company delivered 13,000 vehicles despite factory shutdowns and supply shortages battering its production efforts, with June being the first month the company broke 10,000 since December. While outpaced by its direct competitors in China, Nio has stated that it will begin deliveries of its new ES7 SUV and updated versions of its older vehicles in August, showing substantial recovery in the company's production capacity.
While Tesla may have a massively bigger footprint in the EV market, there are a few uncertainties with its business that seem hard to ignore when compared against the smaller Chinese firm.
For one, while Nio may be fighting for a still-young domestic market, Tesla already sits atop the much more mature U.S. electric vehicle market. While in the past, this has helped to drive Tesla's share prices "to the moon," legacy car manufacturers such as Ford (NYSE: F) and General Motors (NYSE: GM) are starting to catch up. As some experts are predicting, this means that Tesla may have already hit its peak market dominance and is poised to begin losing ground as the US car market becomes more electrified.
Tesla's attempts to catch up to the production capabilities of legacy car companies is also costing it dearly as well. CEO Elon Musk has stated that the company's new German and Texan factories are "losing billions of dollars" as supply chain issues and soaring prices persist. While the company will likely be able to sort these issues out in the future, the potential of losing significant market shares to competitors could increase the burden the company will face trying to make a return on its investments.