The electric car manufacturer cannot convince with its quarterly figures.
(Photo: Reuters)
austin Significant price reductions have caused Tesla’s profit to fall sharply at the beginning of the year, despite a jump in sales. The bottom line is that star entrepreneur Elon Musk’s electric car maker earned $2.5 billion (2.3 billion euros) in the three months to the end of March, 24 percent less than a year ago. Tesla announced this on Wednesday after the US stock market closed. Revenue grew 24 percent to $23.3 billion. Analysts had expected a little more. The stock initially fell about 3 percent in after-hours trading. Since the beginning of the year, however, the price has risen by almost 50 percent.
Tesla delivered 422,875 electric cars in the first quarter. The company thus equaled its previous record, but fell short of expectations. Musk boosted sales with heavy discounts, and there have already been several rounds of price cuts this year. Profitability suffers as a result, even if Tesla has high profit margins compared to the industry. Musk justifies the lower prices by wanting to make e-cars affordable for the masses. There is no lack of demand. However, Tesla manufactured about 18,000 more vehicles in the quarter than the company shipped.
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