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Tesla, an automotive and energy company, hit 13% in shares after Elon Musk announced the production of New EV cars by 2025.
Tesla, the giant of the automotive sector, reported a 9% decline in revenue in Q1 of 2024, the most significant decline since 2012. Elon Musk announced that new EV cars would be affordable by early 2025, which suddenly spiked Tesla’s share. Sales growth across EVs is declining, and Tesla and critical competitors have been cutting EV prices.
Tesla’s Current Performance
The year 2024 wasn’t a good start for the automotive and energy company, as the company reported a 9% decline in revenue in Q1 2024.
On Tuesday, the company experienced a 9% drop in shares, which is one of the most significant declines since 2012. However, the trend flipped, and the stock jumped as the CEO, Elon Musk, announced the production of new affordable EV models.
“The production of the new affordable EV models could begin sooner than expected,” said Musk. Furthermore, Musk stated Tesla’s investments in Artificial Intelligence (AI) infrastructure and had a detailed discussion with one major automaker.
The discussion is anticipated to license the driver assistance system, which is considered one of the US’s full self-driving (FSD) options. The statement simply spiked Tesla’s shares to 13% after-hours.
Before the hike, the company shares were down by more than 40% this year, hitting its lowest since January 2023. Ongoing competition in the Chinese market, weak deliveries, and ongoing price cuts are the main reasons behind Tesla’s performance drop.
Additionally, Tesla’s net income for Q1 2024 is $1.1 Billion. Furthermore, Tesla stock is trading at 144.68, after an upsurge of 1.85% in one day and a market capitalization of $461.38 Billion.
TradingView data shows Tesla’s net income is $15.00 Billion, and the annual revenue is $96.77 Billion.
About The More Affordable EV Cars
Tesla has announced plans to roll out “new models” by 2025, leveraging current platforms and production capabilities. This showcases a shift from earlier, more enterprising projections of launching a brand-new vehicle priced at $25,000.
The news of accelerated product development moved Tesla’s stock upward in post-market trading. It delivers a welcome uplift after declining share prices amid extreme market competition and reduced sales.
This spike occurred even though Tesla’s first-quarter financials did not meet analysts’ forecasts.
Musk announced the upcoming vehicles, mentioning their budget-friendly nature, and are slated to begin production by early 2025. This timeline is ahead of Musk’s previously stated goal for the debut of the much-anticipated, economical “Model 2.”
The new EV vehicles will be manufactured using Tesla’s existing assembly lines and incorporate elements from the current vehicle platform and a forthcoming one.
However, Tesla has revealed that this strategy might lead to lower anticipated cost savings. This indicates that these new models might be priced higher than the expected $25,000 tag for Model 2.
Furthermore, Tesla’s Model 3 and Model Y are the only volume sellers currently available at $40,000.
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