As recently as last year, Tesla said that there would be no cheap model like the expected Model 2. Now the cars are coming anyway.
Tesla has apparently changed its strategy and will now focus on cheaper electric cars. In a statement in connection with the company's latest financial statements, Tesla confirms that production of new, more affordable models will start as early as the first half of 2025.
The decision comes after a disappointing quarterly report in which Tesla's global sales fell for the first time in more than a decade. Net profit fell 23 percent year-on-year, even as total revenue rose slightly.
Tesla has not released details about the new cars, but says they will be built on existing production lines, suggesting the models will be based on existing technology from the Model 3 and Model Y.
As late as April 2024, it was reported that Tesla had dropped all plans for a future 'cheap car', which most expected – and still expect – to be named Model 2.
In addition to the new cars, Tesla is continuing to improve its self-driving technology. The company plans to launch an unattended self-driving service in Austin, Texas, starting in June of this year.
Whether the new models and self-driving technology can reverse Tesla's declining sales figures is still unknown.
Following the announcement of Tesla's declining sales, the brand's share price fell. In fact, it immediately fell by a little more than 5 percent. However, investors' moods turned around almost as quickly. And the stock closed yesterday with a plus of 3.6 percent.
At the time of writing, that value has almost been lost again, as Tesla has fallen by 2.89 percent. This may be because Tesla did not meet expectations.
Because even though the billions continue to pour in with revenue of $25.3 billion, analysts had hoped/expected that Tesla could do $2 billion better during the last quarter of 2024.
This is what Euroinvestor writes.
Lars Skovgaard Andersen, a senior strategist at Danske Bank, points out to the media that it is not the car brand's financial statements that are driving the growth behind the share.
"The stock has been trading on a lot more than their car sales lately. It's trading more on Musk," says the senior strategist.
