In recent years, Tesla has grown faster than established car companies could even dream of. But the uncertain economy and high interest rates are causing a lot of headwind.
Tesla encounters obstacles after a long record run. The electric car manufacturer led by tech billionaire Elon Musk missed market expectations with figures for the last quarter. Musk then expressed concern about the high level of interest rates, which is deterring people from buying cars. Tesla counters this with price cuts, which in turn reduces profitability. That’s why the company is trying to “mercilessly” reduce its costs, as chief engineer Lars Moravy put it.
After all, Tesla confirmed its delivery target of around 1.8 million vehicles this year. Musk also announced the first delivery of the Cybertruck electric pickup truck, which was delayed by around two years, for the end of November. Tesla is expected to be able to build up to 250,000 of the cars per year in 2025, which will open up the electric car manufacturer to the extremely popular vehicle category, especially in the USA.
“Dig our own grave with the Cybertruck”
However, it remains to be seen whether consumers will go along with the Tesla pickup truck with its futuristic shape. Most recently, top dogs such as Ford and General Motors have successfully sold classic-looking large pickup trucks with combustion engines and, in some cases, hybrid drives.
Musk complained that the start of production for the Cybertruck was taking a long time because the vehicle was so unusual and they had to figure out how to build it. “We dug our own grave with the Cybertruck,” he joked on a conference call for analysts.
Musk avoided many specific questions. He was asked whether Tesla would also assume liability if the vehicle was controlled by the advanced version of the “Autopilot” assistance system. Mercedes does this with its Level 3 assistance system, which takes control at low speeds on motorways.
However, Musk limited himself to describing the Mercedes technology as not particularly useful because Tesla had much bigger ambitions. While Musk keeps talking about autonomous driving, the “autopilot” remains just an assistance system in which the person behind the wheel always bears responsibility and must be ready to intervene at any time.
Musk happy with the pace
Similarly, Musk also dodged questions about when Tesla’s humanoid robot could work in the company’s factories and how the development of the driverless robotaxis he promised would progress. Musk said he was very happy with the pace.
When asked about expansion plans for the plants in Grünheide near Berlin and Austin in Texas, he said the current priority is to maximize production on existing production lines.
Musk compared the difficult economy to a storm. Tesla is a robust ship. “We’re not sinking, but even a great ship struggles in a storm.” The share, which was still in the black before the conference call, ended after-hours trading with a price loss of over four percent.
In the last quarter, Tesla increased sales by nine percent year-on-year to $23.35 billion (around €22.15 billion). But analysts on average had expected a good $24 billion. Profit fell by 44 percent to $1.85 billion. Deliveries fell in the last quarter, among other things, due to planned breaks to modernize factories. But these shutdowns had already been taken into account by the analysts.
Source: Stern
