Elon Musk’s car company is losing ground in the market for electric vehicles. In the first quarter of 2024 Tesla reported making 55 percent less in profit and 9 percent less in revenue because of its tepid car sales. Investors start being concerned that this is only the result of bigger problems.
Profit fell to $1.1 billion and revenue to $21.3 billion less than the first three months of 2023, when Tesla had one the best profit margins in the industry. But in 2024 its sales dropped 8.5 percent. The company is also planning to lay off more than 10 percent of its employees worldwide, about 14,000 people.
Reportedly, Tesla has not recovered after it lowered the prices of its vehicles to help sales grow and attract new buyers. But this strategy is not enough. Investors start worrying that the company will not be able to respond to Chinese competition in the next few months. Last week, they asked Mr. Musk to stop spending so much on X, recalling that his polarizing and controversial comments are causing him to lose crucial funds.
The administration has not issued any statement or confirmation yet. Meanwhile Mr. Musk postponed a planned trip to India, where he was meant to meet with Prime Minister Narendra Modi, due to “very heavy Tesla obligations.” Should we take that as a sign?
