Tesla profit plunges on price cuts, but company unveils plans for affordable models

[mahatmakanejeeves]

Source: Washington Post

Tesla profit plunges on price cuts, but company unveils plans for affordable models

Tesla says profits fell 55 percent in the first quarter to $1.13 billion while revenue declined 9 percent

By Faiz Siddiqui and Trisha Thadani
Updated April 23, 2024 at 7:17 p.m. EDT | Published April 23, 2024 at 12:00 p.m. EDT

Tesla reported a steeper-than-expected 55 percent plunge in profit for the first quarter but managed to avoid a major beating on Wall Street on Tuesday by declaring a flurry of bold commitments that appeared to satisfy investors: ramping up the production timeline of a more “affordable” car, doubling down on its fully autonomous “Cybercab” and outlining nearly $1 billion in cost savings from job cuts.

Analysts called Tuesday’s earnings report a “make or break moment” for the electric-vehicle maker as it continues to struggle with falling sales, stiff competition from China and uncertainty over its business outlook. Tesla’s earnings report was indeed grim: For the three months ended March 31, net income fell 55 percent from a year earlier to $1.13 billion while revenue fell 9 percent to $21.3 billion.

CEO Elon Musk, who has a unique penchant for redirecting the conversation, used Tuesday’s earnings call to deflect from the poor numbers, focusing instead on the company’s commitment to artificial intelligence and a fully autonomous car. Details on Tesla’s apparent new offerings — which include the “more affordable models” and the “cybercab” — were scant and did not address how the company would overcome the technological and regulatory hurdles ahead.

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By Faiz Siddiqui
Faiz Siddiqui is a technology reporter with The Washington Post's Business Desk covering companies such as Tesla and Twitter. His area of coverage has also included ride-hailing and the race to build autonomous cars. Prior to that, he covered the D.C. Metro and local transportation scene. Twitter https://twitter.com/faizsays

By Trisha Thadani
Trisha Thadani joined The Washington Post in 2023 from the San Francisco Chronicle. She covers the technology industry, with a focus on Apple’s influence on society, politics and policy. Twitter

Read more: https://www.washingtonpost.com/technology/2024/04/23/elon-musk-tesla-earnings-outlook/

[Aussie105]

1. Random comments:

1. It was bound to happen.
Once the starry eyed early adopters who would pay any price were catered for, demand would decline.

2. Tesla doesn't have a monopoly on the EV market.
Any manufacturer who can do it better and cheaper will get a look in, and take sales from Tesla.

3. A Tesla is a computer system that just happens to be inside a thing that moves.
If you are fine with computers, not a problem - but anyone daunted by needing to become computer literate before being able to drive, may well be put off.
This might be why EV rentals tanked badly.
There is no need for it. The computer side should be background tasks that assist driving, not complicate it.

4. Fiddling with sticker prices affects resale values and would make some think again.

5. Elon being Elon might lose a few sales too.

[maxrandb]

2. Muskrat rips a page out of Donnie Dipshits playbook

"company unveils plans for affordable models" is the South African nazis version of "infrastructure week"

He's been promising an "affordable" model for at least a decade.

Let me guess, he'll have something, "probably", "most likely", "could be" next week, and it will be the bigliest thing, like something no one has ever seen before, right Elon?

Poor Elon, he sadly suffers from delusions of adequacy.

[Hermit-The-Prog]

3. Vaporware has long been used to discourage customers from trying out the competition.

https://www.justice.gov/atr/memorandum-opinion-us-v-microsoft-corp

[Old Crank]

4. Car makers have to seel in volume

Unless you are a very niche maker, Rolls, Ferarri, etc your company needs to push close to 500,000 units into consumer's hands yearly. Ramping up production while keeping costs down is hard. Also you will need to refresh your line up as competators come out with their own new shiny things.
His business was okay when he could charge a lot and his customers got the government kickbacks (rebates).

[Voltaire2]

5. Tesla sold 1.8 million cars last year.

And it is profitable. What it didn’t do this quarter is grow. A successful FUD campaign against EVs, and Musk alienating the core EV consumer demographics with his nonsense, and his lack of focus on the core business while companies like BYD have brought lower priced competitive products to the global market are what has stalled Tesla.

[Zorro]

6. Not rebates

Tax credits. There is a difference.