Wall Street is worried about Tesla's Q1 deliveries as analysts slash estimates

• Wall Street is worried about Tesla's Q1 deliveries.
• Some analysts are predicting the company's first year-on-year sales decline since 2020.

Wall Street is getting nervous about Tesla's Q1 deliveries.

Morgan Stanley, Wedbush Securities, and Deutsche Bank are all predicting a decline in the EV maker's first-quarter deliveries, with some analysts even preparing for its first year-on-year sales decline since 2020.

Analysts' consensus puts the number of deliveries at 477,000 for Q1, according to UBS, which itself has cut its estimate to 432,000.

According to another survey of analysts conducted by Bloomberg, delivery estimates averaged 453,964 vehicles for Q1 — down more than 6% from the fourth quarter.

Deutsche Bank's Emmanuel Rosner also trimmed his delivery forecast from 427,000 deliveries to 414,000.

Wedbush analysts called the company's Q1 deliveries "a nightmare quarter for Tesla."

"While supply issues (factory downtimes/Berlin fire) has impacted supply, there is no denying this has been a quarter to forget for Musk and Tesla," the analysts wrote.

"For Musk this is a fork in the road time to get Tesla through this turbulent period otherwise darker days could be ahead," they added.

The EV company has had a tough few months, with its stock dropping by around 30% so far this year while also being downgraded by multiple Wall Street firms.

In an interview with CNBC, Wedbush Securities managing director Daniel Ives said Tesla was in a "code red situation."

He added that the company was dealing with "dark days" in China in terms of demand.

Tesla has been facing tough competition and slowing demand in China, and in January, it officially lost its title as the world's top seller of EVs to Chinese firm BYD.

Since then, the two have been engaged in a price war to try to entice consumers.

Representatives for Tesla did not immediately respond to a request for comment from Business Insider, which was made outside of normal working hours.

As investors nervously watch for Tesla's delivery figures, CEO Elon Musk has stepped up the company's marketing of its autonomous driving capabilities.

Last week, Tesla began offering a free monthlong trial of its Full Self-Driving software.

The driver-assist software is a $12,000 or $199 a month as an add-on, something that could significantly increase Tesla's profit margins and improve the software, BI reported.