Tesla on the sidelines: profits plummet 71 per cent, Musk vows to 'get back to work'
Tesla has revealed its financial results for Q1 2025 and they were disappointing for the company of the odious billionaire Elon Musk.
Here's What We Know
The first quarter of 2025 was not just weak for Tesla - it was a blow to the company's ego. Net income plummeted 71% to $409 million, while revenue fell 9% to $19.3 billion - its worst quarter since 2022.
Tesla delivered 386,810 vehicles, down 9% from the first quarter of 2024. Production fell 1.7% to 433,371 units.
The company also reported a drop in gross margins to 17.4% (for comparison - in 2024 it was 19.3%). The situation was not saved even by regular discounts, which Tesla calls "dynamic pricing policy".
The main reasons for the drop in sales lie in several factors:
- Chinese electric cars are a serious competitor to Tesla on the global market. Often, they are more affordable, have fewer technical problems and look more attractive than American "electric cars".
- A global decline in demand for electric cars ( LG even decided to exit the charging station business).
- The delayed launch of the new generation of electric cars - Tesla Model 3 and Cybertruck. Potential buyers do not want to buy old models and are waiting for the new ones to be released.
- Musk's political activities, his statements, public behaviour and numerous scandals have also had a huge impact on Tesla. Not only Europeans, but also many Americans are boycotting Tesla products.
Ilon Musk has promised to limit his political activities and "return to active management of the company".
In general, Musk assures that everything is going according to plan, but it would be strange if he said otherwise. For now, the company is living in "weather the storm" mode.
Source: CNBC