Tesla is struggling. It is so critical right now that Elon Musk canceled a visit to India where the company wants to make a big inroad.
Tesla takes action after the breakthrough year 2022
“The reason is at least two-fold: 1) people do not hesitate to buy gasoline and diesel cars, and 2) they may do so because they see that self-driving features are not coming as quickly as Elon Musk has told them for several years . There are probably several reasons why potential buyers no longer necessarily doubt that they must have an electric car, but it is clear that the urge has turned: “Audi and Mercedes turn to electric cars,“We wrote at the end of February,” ITavisen editor Trond Bie commented on Tesla’s situation this week.
Because there is no doubt that the focus is on Tesla in a negative electric car market, even if it is not only them who are struggling. The reason is that they were important for kick-starting the market, and that they have no other legs to stand on like Mercedes and BMW.
“For Tesla’s figures, it reveals what will probably be a trend for a long time to come: in the first quarter of 2024, sales fell by 20 percent compared to the fourth quarter of 2023. In other words, Tesla ended up selling 386,810 cars in the first quarter compared to 484,507 in the fourth quarter last year,” we wrote on April 2.
Tesla: “Prioritizes hybrids”
Yesterday, Tesla announced a super-fast Model 3 that will be delivered to the first customers in May, but that is not the plan of Musk & Co. to turn the ship around in a difficult macro-economic situation.
For the company announced in connection with the quarterly result, which was weaker than what the market expected for the first quarter of 2024, that they are speeding up the launch of a much cheaper model, and that it will arrive this year instead of late in 2025. To further save money, the cars will produced in existing production lines.
The news sent shares up over 13 percent late last night US time. It is not known whether the less expensive model, or models, are in the form of the “Robotaxi” to be revealed on August 8, a completely new model or a variant of the self-driving model that will probably only be minted on the American market. Musk did not want to reveal the details.
Tesla’s auto gross margin — a key measure of profitability — was 16.4 percent in the first quarter, less than the 17.6 percent expected by Wall Street and far from the peak margin of 30 percent the company reported at the start of 2022.
Tesla
“Global sales of electric cars continue to be under pressure as many car manufacturers prioritize hybrids over electric cars. While we are positive about our regulatory credit business, we prefer the industry to continue to push EV adoption, which is in line with our goal. To support our growth, we have increased awareness and expanded vehicle financing programs, including attractive leasing terms for our customers,” the company explains in its quarterly report, which says it has cut expenses. This is related to the fact that the company announced more than 10 percent layoffs earlier this month.
