China Daily Global Edition (USA)
Tesla reports lowest first-quarter profit since 2021
Tesla reported its lowest first-quarter profit since 2021, as it faces stiffer competition especially from Chinese electric vehicle makers and slower worldwide sales.
The company’s net income of $1.1 billion for the January-to-March period was 55 percent lower from the prior year. Revenue fell 9 percent to $21.3 billion, reflecting a decline in both vehicle prices and deliveries.
Before the earnings report, Tesla shares had fallen 42 percent in 2024, but closed Tuesday at $144.68, up $2.63.
Despite the earnings miss, analysts said the stock went up in large part because Tesla said it plans to add to its lineup and market a cheaper EV as early as next year, while also investing in robotaxis.
The company’s earnings call was CEO Elon Musk’s first formal audience with investors since initiating a restructuring that is expected to reduce the company’s global workforce by more than 10 percent.
The Texas-based automaker has seen its vehicle sales falling as demand for EVs is cooling, and it faces stiffer competition from other EV makers, especially in China, the world’s largest auto market.
Tesla has confronted competition by cutting prices again in recent days, knocking $2,000 off several models in the US, which has narrowed profit margins.
The price cuts came after Tesla reported this month that its global vehicle deliveries in the first quarter fell for the first time in nearly four years.
Tesla also has cut prices in a number of its major markets, including China and Germany, as it deals with falling sales and an intensifying price war for electric vehicles in China.
The Wall Street Journal reported Monday that Tesla is engaged in a price war in China with hybrid specialist Li Auto, undercutting each other as sales of electric and hybrid vehicles surpassed those of traditional cars for the first time.
The price cuts by both companies came as new data showed that, for the first time, China sold more electric and hybrid cars than internal-combustion vehicles. Retail sales of new energy cars, which include EVs and plug-in hybrids, made up 50.4 percent of all passenger-vehicle sales in the first two weeks of April, according to the China Passenger Car Association.