New York (AFP) – Tesla reported a 13 percent drop in first quarter auto sales Wednesday amid lower production during factory upgrades and blowback over CEO Elon Musk’s work for President Donald Trump’s administration. Musk’s electric vehicle company delivered 336,681 autos in the quarter ending March 31, missing analyst expectations, as it pointed to the “loss of several weeks of production” while it ramps up upgrades for its Model Y output. Tesla shares fell more than six percent in early trading but later partially rebounded.
The weak car sales add to questions about Musk’s continued stewardship at the automaker, which has been targeted for consumer boycotts and vandalism as the billionaire has helped engineer thousands of job cuts across the US government. Wedbush’s Dan Ives, a prominent technology analyst who has been a longtime believer in Tesla’s growth potential, called the figures “a disaster on every metric,” according to a note. “It’s a fork in the road moment,” said Ives, who has called for Musk to publicly outline how he is balancing his Tesla commitments with his work for Trump. “The more political he gets…the more the brand suffers, there is no debate. This quarter was an example of the damage Musk is causing Tesla,” he added.
“This continues to be a moment of truth for Musk to navigate this brand tornado crisis moment and get onto the other side of this dark chapter for Tesla.” Ives and other long-term Tesla bulls have viewed the company as poised for potentially massive growth, viewing Musk as a guru in state-of-the-art autonomous driving and artificial intelligence technology expected to play a growing role for the foreseeable future.
While Tesla’s release Wednesday did not break out sales for the Cybertruck, the figures suggest anemic sales for the futuristic vehicle, which Musk has passionately embraced. In March, Tesla announced it was recalling essentially all of the Cybertrucks because of a defect that can lead an exterior panel to detach, posing a crash risk. Tesla also did not specify deliveries by country, but figures from national auto authorities have shown big drops across Europe, where Musk’s association with Trump has sparked criticism.
In March alone, Tesla sales fell by more than one-third in France, and almost two-thirds in Sweden. Sales fell 56 percent in Denmark in the first quarter. Tesla shareholder Ross Gerber of Gerber Kawasaki Wealth and Investment Management, who has previously called for the board to remove Musk as CEO, slammed the figure on X, the former Twitter platform now owned by Musk. “These numbers suck,” Gerber posted. “The Cybertruck is basically not selling. The brand is broken and may not be fixable. The board of directors is 100 percent responsible.”
Near 1440 GMT, Tesla shares were down 2.7 percent.
© 2024 AFP
