What just happened to Tesla deserves particular attention: the darkest economic data ever comes out with a sharp drop in net profit in the first quarter (-55% compared to the previous year). Musk officially pledges to launch cheaper vehicles by the end of the year and Tesla soars as trading begins on Wall Street. The shares of the electric car giant suddenly rose by 13% after the announcement.
In short, the stock market is setting the course and – proclamations aside – we will have to see if any manufacturers will actually follow it. It is certainly useful to understand where Tesla's fall comes from. According to the Model S company, 3 and co are due to “numerous challenges” around the world, because sales of electric vehicles are “under pressure”.
In detail? “We faced a number of challenges in the first quarter,” Tesla said in its official statement, citing navigation problems in the Red Sea – due to Houthi attacks – and sabotage that shut down its factory in Germany. The group also insisted that global sales of electric vehicles continue “to be under pressure, as many manufacturers prioritize hybrids over electrics”.
The numbers are certainly scary: in the first three months of the year, Tesla recorded revenues of 21.30 billion dollars, down 9% compared to the previous year, while net profit fell to 1.30 billions of dollars. On a per-share basis and excluding exceptional items – a market favorite – net profit was 45 cents, while analysts had forecast a low target of 49 cents.
The only possible countermove now is a small and economical car. Yes, because, when Tesla instead declared that it had invested 2.8 billion dollars in the first quarter in the artificial intelligence infrastructure, in the production capabilities, in the Supercharger network and in the new production infrastructure, it did not happen on the. Only when the low-cost electricity was announced did the shares move. But the little one cannot arrive before the second half of 2025. As a result, Tesla itself predicts that volume growth in 2024 will be “significantly lower” than that of 2023. The manufacturer had disappointed the markets at the beginning of April by announcing that it had delivered fewer vehicles than the previous year and, above all, much fewer than analysts expected. Production was also disappointing, down 8.5% year-on-year.
In short, if Musk had not wasted time producing the futuristic and useless Cybertruck pick-up (the first examples of which were delivered only at the beginning of December, four years after its presentation) Tesla would not be sailing now such turbulent waters. It is hoped that the lesson will also be useful to other manufacturers who will finally put economical cars on sale.
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