Tesla, 80 billion dollars of value lost in one day
80 billion dollars of value lost in a single day is almost a negative record for Elon Musk’s Group. Tesla is growing too little, with revenues of only 3% in the last quarter of 2020, and investors are punishing it. Shares of the electric car manufacturer fell 13% to $182.63 per share. And the sharply downward market growth forecasts for 2024 compared to the previous year contributed to the decline.
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In the quarterly report we read that “In 2024, our vehicle volume growth rate could be significantly lower than the growth rate achieved in 2023, as our teams work to launch the next generation vehicle at the Texas gigafactory.” Furthermore, the sales trend slowed significantly with an increase of only 3% to 25,167 million dollars. Despite this, profits soared to $5.9 billion.
Tesla, a short-medium term future between lights and shadows
But some investors who have impressed Tesla also believe in positive indicators for the near-term future. Among these: the decline in battery costs, the long-term prospects of the electric market (not so certain forecasts), the evolution of the Group’s solar energy business and above all investments in artificial intelligence.
Many comments on these numbers agree that Tesla will have to lower prices and experience lower margins to boost volume above last year’s 1.8 million level. Furthermore, although 2024 could be a difficult year, it is increasingly clear that 2025 is unlikely to be better, precisely because the pressure on growth and margins is real.” Elon Musk speaking to analysts confirmed that Tesla is preparing to launch a new model towards the end of 2025. “Once launched, it will be far superior to any other manufacturing technology that exists in the world.”
Tesla, the real competitors are the Chinese manufacturers
What investors do not seem to like, however, is the fickleness of Musk himself who, despite earning unprecedented amounts from the shares, sold them in large quantities, then complaining that his shareholding was not high enough. Then speaking about AI Musk has said he doesn’t want additional profits but only to be an effective steward who sees “the path to creating an artificial intelligence and robotics behemoth with truly immense capacity and power.”
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In short, this “volatility” to which are added forecasts of lower demand and growth of competitors, caused the shares to collapse by 26% in 2023. The real opponent for Tesla seems to be the Chinese. China’s BYD took away global leadership in electric car sales in the fourth quarter. But the “crows” in the sector say that interest in electric is decreasing. General Motors and Ford are reducing their investments, and Hertz is selling part of its electric fleet to replace those vehicles with gasoline-powered cars. Although some investors think differently, the future does not seem to be so rosy for the electric car sector.
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