Gary Black Warns Tesla Q2 Deliveries Will 'Disappoint' — Says Cheaper Models Could Cannibalize Sales And See Ideal Re-Entry 22% Below Current Levels

Investor Gary Black, the founder of The Future Fund, has issued a cautious outlook on Tesla Inc.’s (NASDAQ:TSLA) upcoming second-quarter deliveries, saying that the EV giant is likely to miss estimates.

What Happened: On Saturday, in a post on X, Black projected that the company would deliver around 370,000 vehicles in Q2, marking a 17% year-over-year decline, while falling short of consensus estimates by Wall Street analysts at 385,000, or 13% before estimates.

“We expect TSLA 2Q deliv[erie]s due out next week to disappoint,” Black said, adding that the ideal re-entry price for the stock would be “in the $250 range,” which he notes is 30% below the price that his fund had exited a couple of weeks ago, at $358 a share.

See Also: Elon Musk Reveals The Lunch That Launched Tesla: ‘Do You Mind If I Do That?’

Black also cautions that the company’s widely anticipated, upcoming affordable models could end up cannibalizing its sales instead of expanding its total addressable market, if they end up being just stripped-down versions of the existing Model 3 or the Model Y.

“If the 2023–2024 price-cutting experience repeats, a lower-priced, lower-cost model won't expand TSLA TAM or generate incremental volume since it will merely cannibalize the higher-priced trims,” he says.

Instead, Black argues that Tesla would need to introduce an entirely new form factor, such as a compact hatchback or a low-priced pickup, to attract new customer segments and generate true volume growth.

We continue to post on $TSLA because many of our followers ask us daily what might be a good re-entry point.

We would venture a TSLA re-entry price in the $250 range (-30% from our $358 exit) after the new more affordable TSLA is announced and turns out to be a lower cost… pic.twitter.com/gjeAV6ELOC

— Gary Black (@garyblack00) June 28, 2025

Why It Matters: Black has repeated his theory on cannibalization several times in the past, warning shareholders about this for the first time over two months ago.

He has also repeatedly warned that the company’s second-quarter sales would be disappointing. Having said last week that Tesla’s CEO, Elon Musk, is unwilling to accept that at least some of this weakness is owing to the “brand taint associated with his right-wing political rhetoric and DOGE activities.”

Other leading analysts, such as Mark Delaney of Goldman Sachs, have since lowered their price targets for the stock to $290, with a “Neutral” rating, citing the company’s substantial demand and brand-related issues.

There have been several bullish takes on the stock as well, with Wedbush analyst Dan Ives raising the target to $500 while reiterating its “Outperform” rating last week.

In a research note, Ives said, “We believe the march to a $2 trillion valuation for Tesla has now begun.”

Price Action: Shares of Tesla were down 1.43% on Friday, ending the week at $323.79, but it is up 0.75% after hours.

Tesla scores well on Benzinga’s Edge Stock Rankings, and has a favorable price trend in the short, medium and long terms. Click here for deeper insights on the stock, its peers, and competitors.

Photo Courtesy: Jonathan Weiss on Shutterstock.com

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