Tesla has seen its profits more than halve this year and says it will bring forward the launch of new models as it cuts thousands of jobs to try to reverse its fortunes.
The electric
vehicle (EV) maker said on Tuesday it had made $1.13bn (£910m) over the first
three months of the year, compared with $2.51bn a year earlier.
Tesla, owned
and run by the billionaire Elon Musk, said it would also axe more than 6,000
jobs at its sites in Texas and California.
The company
has suffered from falling demand and competition from cheaper Chinese imports
which has led its stock price to collapse by 43% over 2024.
Earlier this month, it said it would
shed 10% of its
global workforce.
Figures for the first quarter of 2024 revealed
revenues of $21.3bn, down on analysts' predictions of just over $22bn.
However the decision by Tesla to bring forward the
launch of new models in the second half of 2025 boosted its shares by nearly
12.5% in after-hours trading.
The EV maker did not reveal details on the pricing
of the new vehicles.
Mr Musk will face investors in a conference
call on details of the new models, possibly including the Model 2 (a cheaper
Tesla vehicle which Reuters reported had been shelved in April).
However, the company has already been on a
charm offensive, trying to win over new customers by dropping its prices in a
series of markets in the face of falling sales.
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Tesla cuts prices in major markets as sales fall
Tesla said its situation was not unique.
"Global EV sales continue to be under
pressure as many carmakers prioritize hybrids over EVs," it said.
Chinese models have also flooded the market
and undercut Tesla's price point, while still providing reliability.
As a result its share price has fallen by
around 40% since the start of this year.
But Tesla has faced similar issues with its
stock price in the past - falling as low as $113 in January 2023 - before it
more than doubled.
And that is not the end of Tesla's troubles after the car firm had to recall thousands of its new Cybertrucks over safety
concerns.
Job cuts
Despite plans to bring forward new models
originally planned for next year, the firm is cutting its workforce.
Tesla said it would lose 3,332 jobs in
California and 2,688 positions in Texas, starting mid-June.
The cuts in Texas represent 12% of Tesla's
total workforce of almost 23,000 in the area where its gigafactory and
headquarters are located.
However, Mr Musk sought to downplay the move.
"Tesla has now created over 30,000
manufacturing jobs in California!" he said in a post on his social media
platform X, formerly Twitter, on Tuesday.
Another 285 jobs will be lost in New York.
Tesla's total workforce stood at more than
140,000 late last year, up from around 100,000 at the end of 2021, according to
the company's filings with US regulators.
Musk's salary
The car firm is also facing other issues, with
a struggle over Mr Musk's compensation still raging on.
On Wednesday, Tesla asked
shareholders to vote for a proposal to accept Mr Musk's
compensation package - once valued at $56bn - which had been rejected by a
Delaware judge.
The judge found Tesla's directors had breached
their fiduciary duty to the firm by awarding Mr Musk the payout.
Due to the fall in Tesla's stock value, the
compensation package is now estimated to be around $10bn less - but still
greater than the GDP of many countries.
In addition, Tesla wants its shareholders to
agree to the firm being moved from Delaware to Texas - which Mr Musk
called for after the judge rejected his payday.
https://www.bbc.com/news/articles/c72pvz18x4lo