For the first time since 2020: Tesla struggles with declining sales

Tesla’s earnings per share were also below market expectations. The bottom line is that quarterly profit fell 55 percent to $1.13 billion (1.06 billion euros). The decline in business figures was evident after Tesla missed expectations in the first quarter with shipments of around 387,000 vehicles.

It was 8.5 percent less than in the same quarter last year – and a 20 percent drop compared to the last quarter of 2023. Tesla says, among other things, that production at the Grünheide factory near Berlin was temporarily suspended in the quarter of first after the attack on the power supply.

Tesla expects further declines

Tesla previously did not provide a specific forecast for emissions for this year, but it expects a significant decrease compared to 2023. The share price temporarily rose more than seven percent in after-hours trading. When presenting its quarterly figures, Tesla confirmed that new models will enter production in the second half of 2025 – including affordable cars. Production previously planned for the second half of 2025 will be brought in at the beginning of 2025 or even at the end of 2024, Tesla boss Elon Musk said on Tuesday.

Tesla gave little information about the planned new cars. This will include “more affordable models,” it said. They should be made using existing materials and adopt the features of current models. The price was not mentioned. CEO Musk said in January that production of the low-cost model should begin in Texas by mid-2025. Investors thought the car, known as the Model 2, would cost $25,000.

Recently, according to media reports, there were doubts whether Tesla would stick with the affordable model that had been announced for years. Musk recently announced the launch of robotaxis on August 8, but did not mention an affordable model for human drivers.

One in ten jobs are at risk

The past few weeks have also been tumultuous for Tesla. After the drop in shipments, Musk announced more than one in ten job cuts. This means that at least 14,000 jobs will be lost – according to media reports, it could also be around 20,000. Tesla also wants to cut 400 jobs at the German factory in Grünheide.

The company announced Tuesday that it is planning a voluntary program to avoid layoffs for operational reasons. Discussions about this should be initiated by the work council. “The weak sales market for electric vehicles also poses challenges for Tesla,” it continued.

That’s why company boss Musk announced global job cuts last week. The Giga factory in Grünheide has already deregistered 300 part-time workers. In total, Tesla employs more than 12,000 people at the factory in Brandenburg.

Stocks at their lowest level since January 2023

The recall campaign for the new Cybertruck pickup truck also revealed that fewer than 4,000 vehicles of the model were built from November to April. At the end of the week, Tesla once again reduced the prices for several types of its models. All this has an impact on the stock price, which Musk’s fortunes are also changing. The stock fell to its lowest level since January 2023 on Monday.

After rapid growth in recent years, Tesla is facing weak demand and increasing competition, especially from China. Since the beginning of the year, the stock has lost more than 40 percent of its value. However, Tesla was still worth 450 billion dollars – almost nine times more than the car giants Ford and General Motors, each of which weighs about 50 billion dollars. A few months ago, Musk emphasized that Tesla was only “between two waves of growth”.

Low cost unboxing technology

An important role should be played by a new car platform on which future Tesla cars can be manufactured more efficiently: unboxing. The approach is intended to herald a fundamental change in car manufacturing. More automation means cars can be built faster, cheaper and with far fewer workers.

Tesla recently gave select guests an insight into its factory in Austin, Texas. Unboxing is being developed in the 90-hectare Gigafactory under the name “NV9X”. Little is known about it at the moment, the project is a secret – and a boss issue. According to Musk, engineers and developers of the project will work around the clock in Austin under his supervision.