Tesla has disappointed investors again. The electric car company founded and directed by Elon Musk broke its sales record in 2022, but fell short not only of its own goals, but also of the more modest forecasts shuffled by analysts. Faced with disappointment, the company’s shares opened the session this Tuesday with a sharp fall of close to 7% on the stock market and the collapse has accelerated to 13% after a black year in which the company has lost two thirds of its value and has caused Musk to lose the throne of the richest man in the world.
The company announced this Monday night in a statement that it produced 439,701 vehicles and delivered 405,278 in the fourth quarter of 2022. In the year as a whole, vehicle deliveries increased 40% year-on-year, up to 1.31 million, while the production grew 47% year-on-year, up to 1.37 million. Despite the strong growth, the figure is far from expectations. The company had set itself a sales growth target of 50% per year, although in the presentation of the results for the third quarter it already warned that it would not reach that goal. But sales also fell short of the 420,000 cars analysts were expecting for the fourth quarter, according to median forecasts compiled by Bloomberg.
The company has been making more cars than it is capable of selling for three consecutive quarters, but the difference has never been as big as in the last one. “We continue to move towards a more balanced regional mix of vehicle manufacturing, which again translated into a new increase in vehicles in transit at the end of the quarter,” the company limited itself to pointing out, which will present its full results next January 31.
Tesla has suffered production stoppages in China due to the pandemic during the fourth quarter, but its sales are also being affected by the slowdown in the economy, hit by inflation, and by growing competition from other electric car manufacturers. According to the list made public by the tax authorities, and about which Musk has complained, most Tesla models do not benefit from the new aid for electric cars implemented by the Inflation Reduction Act approved last year. by the United States, either because they are too expensive or because their batteries do not meet the national production requirements required by the standard. The $6,500 discounts that the company has offered to try to make up for that lack of subsidy have not been enough for sales to reach their goals.
The Twitter Factor
There is another factor that is more difficult to measure, but one that also worries analysts, which is Elon Musk’s public role since he closed the purchase of the social network Twitter. There are three reasons why that operation may be weighing on Tesla. For one thing, Musk has sold tens of billions of dollars worth of shares to finance the acquisition. On the other, by assuming the management of the social network (although he has announced that he is looking for a replacement as its chief executive, after users voted in favor of his resignation) his attention has diverted from Tesla. And third, Musk has adopted a sharp and divisive public profile, with controversial decisions that may have alienated potential Tesla customers.
In addition to the massive layoffs and other controversial decisions, Musk has embraced the Republican Party (for which he has asked for a vote), has attacked the Democrats and has reinstated conservative profiles (some extremists) into his network, starting with the former president, Donald Trump. But while Trump denigrates electric cars at his rallies and tries to move his bases that are stupid, Musk may be drawing the ire of progressives, who happen to be Tesla’s biggest customers.
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