Tesla Struggles With EV Deliveries as Inventory Builds Up

The electric vehicle maker missed delivery expectations again, raising concerns about its free cash flow and future focus on robotaxis.

Apr. 10, 2026 at 7:05am by Ben Kaplan

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A highly detailed, photorealistic studio photograph of a sleek, metallic electric vehicle battery pack or charging port component floating on a clean, white background, lit dramatically with sharp shadows to convey a sense of corporate strategy and financial uncertainty.As Tesla grapples with inventory buildup and delivery challenges, the company's electric vehicle business faces an uncertain future.San Francisco Today

Tesla reported disappointing first-quarter 2026 electric vehicle deliveries of 358,023, below the 370,000 expected by Wall Street analysts. The company's EV business has been struggling for over a year, with total deliveries falling from 1.79 million in 2024 to 1.64 million in 2025. Tesla is now sitting on a significant backlog of unsold EVs, the largest buildup the company has ever had, which could add pressure to its free cash flow.

Why it matters

Tesla's struggles in its core EV business raise concerns about the company's future direction and ability to generate positive cash flow. With a growing focus on developing robotaxis and humanoid robots, Tesla's stock performance is now heavily dependent on the success of these new initiatives, rather than its traditional automotive business.

The details

Tesla's first-quarter 2026 EV deliveries rose 6% from Q1 2025, but that's a small improvement considering deliveries in Q1 2025 were down 13% year-over-year. The entire EV sector is facing headwinds, including more competition, tariffs, and a de-emphasis on green energy policies. Tesla's Model 3 and Model Y made up 97% of all sales in the quarter. The company produced over 408,300 vehicles but delivered only 358,023, meaning it has a significant backlog of unsold EVs, which could add pressure to its free cash flow.

  • Tesla reported its Q1 2026 EV deliveries on April 10, 2026.
  • Total Tesla deliveries fell from 1.79 million in 2024 to 1.64 million in 2025.

The players

Tesla

An American electric vehicle and clean energy company that designs and manufactures electric cars, battery energy storage from home to grid-scale, solar panels, and related products.

Elon Musk

The CEO and co-founder of Tesla, who has shifted the company's focus towards developing robotaxis and humanoid robots.

Jed Dorsheimer

A research analyst at William Blair who stated that global EV demand outside of China remains under pressure and that Tesla is sacrificing its EV business in favor of a fully autonomous future.

Ryan Brinkman

A JPMorgan Chase analyst who said Tesla's inventory buildup is likely to add to concerns about the company's free cash flow.

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What they’re saying

“global EV demand ex-China remains under pressure, and Tesla is actively sacrificing its EV business in favor of a fully autonomous future.”

— Jed Dorsheimer, Analyst, William Blair

What’s next

Tesla's ability to successfully launch and scale its robotaxi fleet will be crucial to the company's future performance and stock price. Investors will be closely watching for updates on Tesla's progress in this area.

The takeaway

Tesla's struggles in its core EV business, combined with its growing focus on robotaxis and humanoid robots, highlight the company's shifting priorities and the risks it faces in transitioning to new technologies. Investors will need to carefully evaluate Tesla's ability to execute on these ambitious plans while also maintaining a healthy automotive business.