Tesla recorded earnings of $7.9 billion in net income on $25.2 billion in revenue during the fourth quarter of 2023. The figures indicate an increase in revenue, up from $24.3 billion the same time last year.
The company’s profit levels improved slightly but are still down compared to last year’s. The company recorded margins of 8.2 percent, up slightly from 7.6 percent the previous quarter but down from last year’s 16 percent.
but still down compared to last year :
Tesla used to have historic profit margins, sometimes as much as 20 percent, but a series of price cuts have caused its once-vaunted margins to drop into more earthly ground, worrying investors.
Also fewer Tesla cars qualify for the federal EV tax credit, thanks to strict new rules for the sourcing of battery materials. The performance version of the Model 3, the long-range version of the Model X, and three versions of the Model Y still qualified for the full $7,500 tax credit, which can now be applied at the point of sale.
It was a pretty important quarter for the company, with the long-awaited release of the highly polarizing Cybertruck, as well as news that the refreshed version of the Model 3 would be coming to North America. But recent high-profile stories, like Hertz replacing some of its Tesla fleet with gasoline-powered cars and Tesla’s failing charging network in cold-weather places like Chicago, have dampened the outlook for the company in 2024.
Tesla is also facing the existential task of losing its place as the world’s top producer of electrified vehicles to BYD. The Chinese company said it made 3.02 million EVs in 2023, as compared to Tesla’s 1.81 million cars. However, BYD’s numbers include 1.6 million battery-electric cars and 1.4 million hybrid vehicles — so Tesla can still claim to be the top producer of pure EVs.
Hours before the earnings report was released, Reuters reported that Tesla plans to start production on an all-new electric crossover car in mid-2025. The company has supposedly invited suppliers to bid to work on the car and is forecasting producing 10,000 vehicles weekly. Speculation is that this could be Tesla’s long-promised $25,000 car for mass-market consumers.
“We are focused on bringing the next generation platform to market as quickly as we can, with the plan to start production at Gigafactory Texas,” Tesla said in a note to shareholders. “This platform will revolutionize how vehicles are manufactured.”
The company also predicted that its growth rate in 2024 “may be notably lower” than it was in 2023 as it works to launch the next-gen car.
But Musk has been making investors nervous by making statements about spinning off Tesla’s artificial intelligence work into a separate company if he is unable to grow the size of his ownership. Such a move would greatly undercut the company’s value, which is largely based on futuristic vibes.