Tesla Inc. announced plans to accelerate the launch of new affordable electric vehicles (EVs), despite missing Wall Street estimates in its first-quarter earnings report. The move aims to boost vehicle volumes in a cost-efficient manner during uncertain times.
Tesla said it plans to launch new models, including affordable EVs, ahead of its previously communicated start of production in the second half of 2025. “These new vehicles, including more affordable models, will utilize aspects of the next generation platform as well as aspects of our current platforms, and will be able to be produced on the same manufacturing lines as our current vehicle line-up,” the company said in a statement accompanying its Q1 earnings. “This update may result in achieving less cost reduction than previously expected but enables us to prudently grow our vehicle volumes in a more capex efficient manner during uncertain times.”
Going into its Q1 report, shares of Tesla had shed more than 43% so far in 2024 and were at a 15-month low amid concerns about its continued vehicle price cuts and layoffs. For the first quarter, Tesla posted a 9% year-over-year drop to $21.3 billion, attributed to a reduced vehicle average selling price and a decline in vehicle deliveries. Analysts had expected revenue of $22.15 billion. Adjusted earnings per share (EPS) were $0.45, slightly below the consensus estimate of $0.46. Gross margins, a closely watched metric as Tesla has repeatedly slashed the prices of its vehicles, were 17.4%, down from 19.3% in the year-ago quarter.
Tesla shares added 6.3% at about $153 shortly after the release of its earnings report.
