Tesla just reported an abysmal quarter with Model S and Model X sales falling off a cliff (TSLA)

SpaceX founder Elon Musk speaks at a post-launch press conference after the SpaceX Falcon 9 rocket, carrying the Crew Dragon spacecraft, lifted off on an uncrewed test flight to the International Space Station from the Kennedy Space Center in Cape Canaveral, Florida, U.S., March 2, 2019. REUTERS/Mike Blake

Tesla reported first-quarter earnings on Wednesday that missed Wall Street estimates.
Model S and Model X sales dropped drastically in the quarter.
CEO Elon Musk said that's not because of cannibalization from the newer, cheaper Model 3.
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Tesla reported first-quarter earnings on Wednesday that missed analysts' estimates on both the top and bottom lines.

Among the details shared in the company's letter to shareholders were sales updates on each of Tesla's three models, and demand for its original two, the Model S and Model X, appears to be struggling.

"Deliveries of Model S and Model X declined to 12,100 vehicles in Q1 compared to our two-year run rate of roughly 25,000 units per quarter," the company said.

"This decline was mainly caused by weaker Q1 demand due to seasonality, pull-forward of sales into Q4 2018 in the U.S. due to the first scheduled reduction of the federal EV tax credit in Q1 and discontinuation of our 75 kWh battery pack," it added.

There were some fears that the Model 3, which now comes at a much cheaper price point than its larger counterparts, would affect the sales of the other two models, but executives were quick to discount those fears on a conference call following the earnings report.

"3.5% of trade-ins for the Model 3 are coming from the Model S," CEO Elon Musk said, adding that it's a "tiny portion" of all trade-ins.

Tesla said the average selling price for the Model 3, which starts at $39,500 in the US, is about $50,000. For comparison the Model S and the Model X start at $78,000 and $83,000, respectively.