When Tesla releases its first quarter earnings this afternoon, the company’s CEO Elon Musk will field the usual questions about new products, new factories, and progress toward its futuristic vision of self-driving cars and robot workers. But Musk will also face increasingly urgent questions about its current state of affairs — and why everything seems to be going to shit.
Earlier this month, the company reported its first year-over-year sales drop in four years, a sign of rougher waters ahead. Tesla’s stock has fallen more than 40 percent since the start of the year, including a 13 percent drop in the last week. The company laid off over 14,000 employees last week, 10 percent of its global workforce — which could end up being closer to 20 percent when all’s said and done, according to Bloomberg. Today’s earnings report is expected to include Tesla’s lowest profit margins in six years, a sign that rampant price-cutting continues to exact a toll.
Yet another CEO of a luxury item company that thought fame made him untouchable finds out that running your mouth off will turn people off from buying something they don’t actually need. If you sell a product favored by progressive and left leaning individuals and go on right wing rants you’re gonna have problems. That, and massively under-delivering on promised car features.
*I figure at the price point Tesla cars are they are indeed a luxury item. It’s a luxury to be able to afford them and afford the statement an owner makes by buying one (early adopter, environmental, whatever) There’s plenty of ICE cars, hybrids, or PHEV that are cheaper, more reliable, and have better service availability.
also moving all the controls to a touch screen? stupid. A car isn’t a smart phone
Tesla has luxury models and trim levels, but I’d say several variants of the Model 3 and Model Y are fairly price competitive with its competition, especially if accounting for government tax subsidies.
The average new car transaction is about $47,000, and several Tesla options fall well under that average.