According to a report by CNBC, The Global Times called the Tesla and Twitter CEO out for advancing what they call a “conspiracy theory that slanders China” about covid leaking from a Chinese lab.
Musk was responding to a tweet claiming that Anthony S. Fauci, the former medical adviser to President Biden and Trump, funded the creation of the coronavirus.
“He did it via a pass-through organization (EcoHealth),” Musk tweeted, implying that the unproven theory was true.
In a social post of their own,The Global Times snapped back, “these remarks of his have been continuously used by those US right-wing and anti-China media hostile to China as material to frame China.”
The Global Times also asked if Musk is “breaking the pot of China,” an expression similar to the English phrase “biting the hand that feeds you,” according to CNBC reporter Eunice Woon.
Bad relations with the Chinese government could be disastrous for business. China is Tesla’s second-largest market after the United States, making up around 40 percent of its total sales. Tesla also has a massive factory in Shanghai.
The electric-vehicle pioneer’s 2023 investor event is coming up on March 1. It’s a chance for investors to hear from CEO Elon Musk about the company’s strategy and future. This year, as EV competition ramps up, one issue looms larger than others.
An entry-level Tesla now costs less than the average new car after the automaker started slashing prices on its vehicles earlier this year, making them more affordable than some new gas-powered cars.
The Tesla Model 3 now starts at $43,000, not including the $7,500 tax credit Americans can get for buying an electric vehicle. That brings the after-rebate price of a Model 3 down to $35,500.
Even without the tax credit, a Model 3 costs $4,930 less than the average new vehicle sold in the U.S., according to a Bloomberg analysis. At the same time, new gas-powered cars have been increasing in price, with the average cost of a new car in January sitting at $49,388, a 6% increase from a year earlier, according to Kelley Blue Book data.
That’s noteworthy because automotive industry watchers have been waiting for the day when electric vehicles could match or beat the price of their gas-powered siblings.
To be sure, the electric vehicle segment as a whole hasn’t fully reached that milestone yet. Dozens of electric cars at dealerships cost north of $50,000 — including the the Genesis Electrified G80 (starting price at $79,825), the BMW i4 (starting at $52,000) and the Audi RS e-tron GT (starting at $105,000).
EV price war
Ford reduced the price on its electric Mustang soon after Tesla’s move and, in doing so, set off an electric vehicle price war, said Dan Ives, an analyst at Wedbush Securities.
“In this EV arms race, Tesla is uniquely positioned around scale, brand, battery technology, and the Musk DNA while others are aggressively going after market share in this all out Game of Thrones battle,” Ives wrote in a research note last month.
The electric vehicle market — which is expected to reach $1.1 trillion globally by 2030 — has indeed had its own starts and stops in recent years, ignited by supply-chain woes caused by the pandemic and Russia’s ongoing war in Ukraine. In 2022, automakers hiked the price of EVs as they struggled to get raw materials for making lithium-ion batteries. At one point last year, the Model 3 price climbed as high as $62,000.
Automotive industry experts said it’s important to watch the price of electric vehicles as the U.S. tries to loosen its dependency on fossil fuels and gas-powered cars. Charging stations are sprouting up nationwide to encourage consumers to buy electric, but price hikes from 2022 put many of those vehicles financially out of reach of the middle class, experts said.
Automakers are battling for customers and “2023 is a pivotal year that will establish the winners and losers in this EV landscape with Tesla high on top of the mountain.”
Other analysts said last month that Tesla is dropping its prices because of slowing demand, pushing the company to prioritize sales volume over profitability. This week, U.S. safety regulators pressured Tesla into recalling nearly 363,000 vehicles after their self-driving feature failed to follow posted speed limits or stop at intersections.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
WALNUT CREEK, Calif. (AP) — A Tesla driver was killed and a passenger was critically injured Saturday when the car plowed into a fire truck that was parked on a Northern California freeway to shield a crew clearing another accident, fire officials said.
Four firefighters who were in the truck when it was struck on Interstate 680 were treated for minor injuries, said Tracie Dutter, assistant chief of the Contra Costa County Fire Protection District.
The driver was declared dead at the scene, Dutter said. The car needed to be cut open to remove the passenger, who was taken to the hospital.
Photos showed the front end of the car was crushed and the $1.4 million ladder truck was damaged.
California Highway Patrol Officer Adam Lane said it was not clear whether the driver may have been intoxicated or whether the Tesla Model S was operating with automation or driving assistance features.
Dutter said the truck had its lights on and was parked diagonally on northbound lanes of the freeway to protect responders to an earlier accident that did not result in injuries.
The fatal accident occurred around 4 a.m., and it took several hours to clear the freeway. The firetruck had to be towed away.
The Model S was among the nearly 363,000 vehicles Tesla recalled on Thursday because of potential flaws in its “Full Self-Driving” system. While the recall is aimed at correcting possible problems at intersections and with speed limits, it comes amid a broader investigation by U.S. safety regulators into Tesla’s automated driving systems.
Tesla, the major player in the electric car industry, is set to open up some of its charging stations to all US electric vehicles for the first time.
Under the new plan, at least 7,500 charging points from Tesla’s Supercharger and Destination Charger networks will be made available to non-Tesla EVs by the end of 2024. This move has the potential to revolutionize the promotion of electric vehicle use, which is a significant component of President Joe Biden’s objective to combat climate change, and opening it to the country’s largest and most reliable charging network could be a game-changer.
“As President Biden said, the great American road trip will be electrified,” said Mitch Landrieu, a White House aide who oversees implementation of the 2021 infrastructure law signed by Biden.
The White House revealed a range of new initiatives on Wednesday, aimed at making EV charging networks more accessible and reliable for Americans, especially for those traveling long distances. These initiatives include introducing new standards that will ensure anyone can use a charging network, regardless of their vehicle or location.
Tesla, General Motors, Pilot, Hertz, EVgo, and several other companies have committed to increasing the number of public charging ports by thousands over the next two years. This expansion will be funded by private funds and federal spending from the infrastructure law, bringing the nation closer to achieving Biden’s EV charging goals.
Tesla is set to install charging stations in public places such as hotels and restaurants, which will be accessible to all EV drivers using the Tesla app or website. Additionally, Tesla has plans to expand its network of Superchargers nationwide by 2030.
The implementation of standards will not only guarantee the effectiveness of the substantial investment in EV charging infrastructure but also foster the creation of high-paying employment opportunities, and ensure that the EV chargers receive quality maintenance through the enforcement of rigorous workforce standards such as the Electric Vehicle Infrastructure Training Program (EVITP) and Registered Apprenticeships. As part of the White House Talent Pipeline Challenge, the International Brotherhood of Electrical Workers (IBEW) has already certified 20,000 electricians through the EVITP program.
Part of the new Infrastructure Bill
These measures will aid the US in fulfilling the ambitious targets of the Biden administration to tackle the climate emergency, including constructing a countrywide network of 500,000 electric vehicle chargers on American highways and ensuring that EVs make up at least 50% of new vehicle sales by 2030. Furthermore, they will foster an industrial strategy to advance the domestic electric vehicle and charging sector.
Apart from investing around $7 billion in EV battery components, crucial minerals, and materials, the Bipartisan Infrastructure Law allocates $10 billion for sustainable transportation and $7.5 billion for EV charging.
Together with several other federal initiatives aimed at supporting domestic manufacturing and establishing a nationwide network of EV charging stations, these flagship programs are a substantial addition to the Inflation Reduction Act’s backing of cutting-edge batteries, fresh and extended tax credits for EV purchases, and funding for the deployment of charging infrastructure.
Workers at a Tesla factory in Buffalo, New York, announced on Tuesday they intend to form a union.
“The group wants to form a union “that looks to be as innovative as the company we work for,” the group, Tesla Workers United, said in a statement posted online.
The group posted online in order to garner more support internally for the effort, as The New York Times noted. It will be organized with Workers United Upstate New York.
Now that the Tesla group has announced publicly, they will make overtures to coworkers to obtain support (via signed cards). If they can get 30% of workers to say they want a union, the National Labor Relations Board (NLRB) will hold an election. This leads to a certification process if successful. Employers can also voluntarily recognize a union.
Tesla CEO Elon Musk has previously expressed disagreements with unionization. Per CNBC, the NLRB ordered Tesla to hire back a union proponent it had fired and for Musk to remove a Tweet attacking unions (“why pay union dues & give up stock options for nothing?” the Tweet said). The NLRB in August also said it was not lawful for Tesla to prevent workers from wearing shirts with a union logo, over an issue that had begun in 2017.
The factory in Buffalo is called Gigafactory 2 and makes solar and battery products.
There have not been any successful unionization efforts at Tesla factories — distinct from other automakers, Bloomberg noted. One example is Ford, which has unionized workers through UAW (full name: The International Union, United Automobile, Aerospace and Agricultural Implement Workers of America) one of the biggest unions in the country.
The group is looking to “have a real voice in setting organization policies, staffing levels, rights on the job, health and safety conditions, protections from unfair firings or unfair discipline, seniority rights, leaves of absence rights, and benefits,” according to its FAQ.
Tesla workers at a plant in Buffalo, New York, announced a campaign to form what would be the electric car company’s first union, setting up a potential clash with CEO Elon Musk.
Workers in Tesla’s Autopilot division emailed a letter Tuesday to management announcing their intent to unionize and asking the company to stay neutral in the campaign.
The Autopilot union has roughly 800 workers, who analyze data to help the car’s self-driving software, and about 1,600 in the Buffalo plant overall, according to an organizer with the campaign.
“This is really only a fight to make a good job better,” Keenan Lasch, one of the campaign’s organizers, said in a statement announcing the union drive. “We are paid far less than the national average for our job title and have next to no sick time. We are only asking for a seat in the car that we helped build.”
Claims of excessive monitoring
Other organizers said workers in Tesla’s Buffalo facility face heavy monitoring and sometimes skip bathroom breaks because they feel pressured to keep their metrics up.
Will Hance, who started working at Tesla in October, said he was one of a group of new hires who were promised raises to $20.40 an hour after three months of work — raises that never materialized. Many workers were also disillusioned when Tesla delayed a decision to close its facility during the historic snowstorm that hit Buffalo in December, Hance said.
In an online company forum, “people were complaining about the policy, and people had begun to react to some of the posts with union emojis, and that’s where I first heard about it,” he said.
“It’s about the ability to just have a say in how we operate —how policies affect me, and my relationship to my work,” he said.
The Tesla workers are seeking to join Workers United, a new union that has organized hundreds of Starbucks stores in the past year, starting with a Starbucks in Buffalo — a few miles from the Tesla store. The workers are being helped in the effort by Jaz Brisack, one of the leaders of the Starbucks union who resigned last fall, saying the coffee chain forced her out in retaliation for her union activity.
Tesla did not immediately respond to a request for comment.
Musk not a fan
The effort is likely to face an uphill battle at Tesla, where Musk has made clear his disdain for unions.
“A union is just another corporation” the billionaire CEO tweeted last year, claiming at the time that if workers at the California plant unionized they would lose stock options.
A union is just another corporation. Far better for many companies to compete for your skills, so that you have maximum optionality.
The National Relations Labor Board’s chief prosecutor in 2022 charged that Tesla illegally silenced workers in Florida by telling them not to discuss pay or another worker’s firing, which would be against federal labor law.
A previous effort to organize the Buffalo facility and a union drive in Tesla’s factory in Fremont, California, both fizzled. Tesla was found by the labor board to have illegally coerced some Fremont workers, although the company is appealing that ruling.
Biden administration officials announced a significant step Wednesday in moving the U.S. toward a more expansive and cohesive network of EV charging stations.
Part of the move includes a major concession from EV market leader Tesla, which owns and operates an extensive network of proprietary “superchargers” for its cars. But now, White House infrastructure coordinator Mitch Landrieu says the Elon Musk-led company has agreed to open part of its charging network to non-Tesla vehicles.
“These recent and new commitments will make more public chargers available for all EVs,” Landrieu said Tuesday on a background call with reporters. “With announcements like today’s and the overall growth we’re seeing, it’s clear that this administration is making incredible progress towards building our electric future.”
Some $7.5 billion from the Infrastructure Investment and Jobs Act will be spent on building out a network of 500,000 EV chargers across the country. A key requirement for EV chargers backed by federal funding is that they must provide charging access for any electric vehicle. Had Tesla opted to limit the use of its supercharger network to Tesla’s with its proprietary connector, it would have been ineligible to receive federal funds to expand its network with government support. A White House official confirmed that Tesla will be able to obtain federal funds for some 7,500 chargers that it expects to open up to non-Tesla vehicles by the end of 2024. Those chargers will have to be outfitted with adapter connections to allow any EV to use the chargers.
Landrieu added that the White House has been in contact with Tesla and other companies in coordinating plans to build out the EV charging network. The announcement also included partnerships between GM and EV charging station company FLO to construct up to 40,000 Level 2 chargers, along with a deal between Hertz and BP to build out charging stations at Hertz locations in major cities. Other automakers like Ford, Mercedes and Volvo are also supporting the effort either through partnerships or direct investments. In all, the White House says some 100,000 public chargers will begin to be added across the country beginning as soon as 2024, as result of the announced plans.
One goal is to ensure that EV drivers will have the ability to drive across the country and easily find a reliable charger. It’s a goal that remains a challenge for many EV drivers. Transportation Secretary Pete Buttigieg says ease of use is a major priority for the construction of the charging network.
“No matter what EV you drive, we want to make sure that you will be able to plug in [knowing] the price that you’re going to be paying and charge up with a predictable and user-friendly experience,” said Buttigieg, who was also on the background call with Landrieu. “Just as when you are filling up with gas today, you know that the experience will be broadly consistent, regardless of your location and regardless of the vendor,” he added.
Officials on the call also outlined a “build America, buy America” requirement for EV chargers supported with federal funds that mandates manufacturers ensure final assembly of the chargers takes place within the U.S. By July of next year, builders will also need to ensure that 55% of component costs are sourced domestically as well.
The new development comes as the White House works to ramp up its clean energy priorities that would call for spending billions in funding and incentives for states, businesses and consumers in order to curb greenhouse gas emissions. The Infrastructure Investment and Jobs Act includes $7.5 billion in funding for EV charging, $10 billion for clean transportation, along with $7 billion for battery components for EVs. Buyers of new and used EVs could also receive a key tax credit funded by the Inflation Reduction Act, which includes $369 billion to fund projects aimed at reducing the effects of climate change. The Biden administration has set a goal for EVs to make up half of all vehicles sales in the U.S. by 2030 and to reach net-zero emissions by 2050.
Tesla workers at a plant in Buffalo, New York, on Tuesday announced a campaign to form what would be the electric car company’s first union, setting up a potential clash with CEO Elon Musk.
Workers in Tesla’s Autopilot division emailed a letter Tuesday to management announcing their intent to unionize and asking the company to stay neutral in the campaign.
The Autopilot union has roughly 800 workers, who analyze data to help the car’s self-driving software, and about 1,600 in the Buffalo plant overall, according to an organizer with the campaign.
“This is really only a fight to make a good job better,” Keenan Lasch, one of the campaign’s organizers, said in a statement announcing the union drive. “We are paid far less than the national average for our job title and have next to no sick time. We are only asking for a seat in the car that we helped build.”
Claims of excessive monitoring
Other organizers said workers in Tesla’s Buffalo plant face heavy monitoring and sometimes don’t have time for bathroom breaks because they are tracked so closely.
“We give so much of ourselves and our lives to our workplace, and for as much as we provide for the company, we deserve to have the company provide for us, too,” another worker, Alexis Hy, said in the announcement.
The Tesla workers are seeking to join Workers United, a new union that has organized hundreds of Starbucks stores in the past year, starting with a Starbucks in Buffalo — a few miles from the Tesla store. The workers are being helped in the effort by Jaz Brisack, one of the leaders of the Starbucks union who resigned last fall, saying the coffee chain forced her out in retaliation for her union activity.
Tesla did not immediately respond to a request for comment.
Musk not a fan
The effort is likely to face uphill battle at Tesla, where Musk has made clear his disdain for unions.
“A union is just another corporation” the billionaire CEO tweeted last year, claiming at the time that if workers at the California plant unionized they would lose stock options.
A union is just another corporation. Far better for many companies to compete for your skills, so that you have maximum optionality.
The National Relations Labor Board’s chief prosecutor in 2022 charged that Tesla illegally silenced workers in Florida by telling them not to discuss pay or another worker’s firing, which would be against federal labor law.
A previous effort to organize the Buffalo facility and a union drive in Tesla’s factory in Fremont, California, both fizzled. Tesla was found by the labor board to have illegally coerced some Fremont workers, although the company is appealing that ruling.
The 30-second spot depicts brutal scenes of self-driving Teslas running over child mannequins and baby strollers, driving on the wrong side of the road, and blowing past “Do Not Enter” signs.
The national advertising campaign, which cost $600,000 to air during the Super Bowl, is sponsored by The Dawn Project, a California-based nonprofit that supports the development of computer operating systems that are “safe for humanity.”
The organization has been particularly critical of Tesla’s Full Self-Driving feature, claiming the software poses a threat to passengers and pedestrians.
“Tesla Full Self-Driving will run down a child in a school crosswalk,” a female narrator says in the ad, as a video shows what it claims to be actual “safety test footage” of a Tesla crashing into a child mannequin in the street.
Later in the ad, a Tesla plows into another child mannequin taking its head off.
“Tesla’s Full Self-Driving is endangering the public with deceptive marketing and woefully inept engineering,” the narrator says. Why does NHTSA allow Tesla Full Self-Driving?”
Who’s behind the attack ad?
The Dawn Project was founded by Dan O’Dowd, a billionaire credited with creating the operating systems for projects including Boeing’s 787s, Lockheed Martin’s F-35 Fighter Jets, the Boeing B1-B Intercontinental Nuclear Bomber, and NASA’s Orion Crew Exploration Vehicle.
Dowd is also CEO of Green Hills Software, which develops self-driving software.
The foundation’s website shows numerous videos of self-driving Teslas malfunctioning in different road tests. In one video, O’Dowd accuses Tesla founder Elon Musk of running a Ponzi scheme.
The company has not directly addressed The Dawn Project, but in response to a tweet by Tesla Owners Silicon Valley that called the ad “fake,” Musk responded with a LOL emoji.
Thank you @RealDanODowd for spending $7M for this $tsla advertisement. It’s very clear that you testing was fake but grateful for spreading the word that Teslas are the leader for general autonomy. @elonmuskpic.twitter.com/Qk7MvJn4c4
A little-known consumer advocacy group chose an unusual — and expensive — way to draw attention to what it sees as the threat to life and limb posed by Tesla vehicles’ “Full Self-Driving” system: It bought a Super Bowl ad.
During Sunday’s broadcast of Super Bow LVII, a spot from The Dawn Project said Tesla’s self-driving technology is built on “woefully inept engineering” that poses a treat to pedestrians and drivers. The software also can cause the electric car maker’s vehicles to swerve into oncoming traffic or drive on the wrong side of the road, the nonprofit group claims.
“Tesla has known for more than six months that its Full Self-Driving software will run down a child in a crosswalk, along with hundreds of other critical safety defects reported by us and other beta testers,” The Dawn Project’s Founder Dan O’Dowd said in a statement Sunday.
He also urged the federal National Highway Traffic Safety Administration to “immediately switch off” Tesla’s Full Self-Driving software on public roads.
The group’s commercial aired in select cities, including Atlanta, Austin, Texas, and Washington, D.C. The Dawn Project paid $598,000 for the 30-second spot, a spokesperson told CBS MoneyWatch.
NHTSA is currently probing Tesla’s Full Self-Driving feature and “generally does not comment on open investigations,” the agency told CBS MoneyWatch in a statement Monday.
Tesla, which has dismantled its media relations department, could not be reached for comment.
What is The Dawn Project?
The Dawn Project is a California-based nonprofit that campaigns for the development of computer software that’s safe for people. The organization conducts independent safety tests on power grids and water treatment plants as well as devices in the health care and transportation industries.
The Dawn Project draws its funding from Dan O’Dowd, the CEO of Green Hills Software, which has developed its own vehicular self-driving software. That makes its technology a direct competitor to Tesla’s proprietary self-driving system.
O’Dowd is a billionaire who built his fortune by selling customized software to Boeing, Lockheed Martin and NASA. On the Dawn Project’s website, the California Institute of Technology graduate is described as the “world’s leading expert in creating software that never fails.” Californians may also remember O’Dowd for running an unsuccessful campaign for U.S. Senate last year.
The ad criticizing Tesla aired in state capitals in California, Florida, Georgia, New York and Texas so it would be seen by politicians and regulators, O’Dowd said in a statement.
The Dawn Project began focusing on Tesla last year after posting videos of safety tests conducted by the organization that purport to show the vehicles running over mannequins while the cars’ self-driving systems were engaged. O’Dowd tweeted at the time that the test shows that Tesla vehicles “will indiscriminately mow down children.”
Tesla CEO Elon Musk replied to the tweet with a bat emoji, poop emoji and the word “crazy.”
The Dawn Project also took out a full-page ad in the New York Times last year warning consumers about Tesla’s Full Self-Driving software.
NHTSA said in December that it’s investigating two crashes from November in California and Ohio involving Tesla’s automated driving systems. The agency has launched probes into 35 separate crashes, 19 of which were fatal, into Tesla’s self-driving features since 2016, the Associated Press reported.
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
Tesla’s Model Y model and other electric vehicles from auto manufacturers including Ford, General Motors and Volkswagen will now qualify for a federal tax credit of $7,500, the IRS said Friday.
The change comes after the U.S. Treasury Department revised its vehicle classifications in a way that broadens the definition of what qualifies as an SUV, which has a higher price threshold to qualify for the tax credit. Previously, the five-seat Tesla Model Y was classified as a sedan, which meant it didn’t qualify for the EV tax credit because it cost more than $55,000 price cap for sedans stipulated under the government’s rules.
The issue had drawn the ire of Tesla CEO Elon Musk, who had complained that the earlier classification was “messed up,” according to The Verge. The tax credits stem from the Biden administration’s Inflation Reduction Act, which provides billions in rebates for EVs and home upgrades geared toward shifting consumers away from fossil fuels.
Expanding the number of SUVs that qualify for the full $7,500 tax credit could spur consumer demand for EVs, given that the crossover SUV vehicle is one of the fastest growing auto segments, noted Albert Gore, executive director of the Zero Emission Transportation Association.
“Congressional intent with the IRA and clean vehicle tax credit was to rapidly accelerate deployment of qualified EVs, and today’s decision is a big step toward that goal,” Gore said in a statement. “We have long advocated for the IRA’s tax credits to be as widely accessible as possible.”
General Motors had also pushed back against the prior limits, with the automaker asking the Treasury earlier this month to reconsider classifying its electric Cadillac Lyriq so that it would meet the threshold for the credits, Reuters reported. The Lyriq costs about $62,000.
GM said it was “excited” that customers who qualify for the tax credit will be able to use it to buy the Lyriq SUV. “Tax credits are a proven accelerator of electric vehicle adoption,” the company said in a statement sent to CBS News.
The tax credits will be retroactive for the newly qualified vehicles for purchases on or after January 1, when the new rebates went into effect.
Last year, Teslas weren’t eligible for a tax break under a previous federal credit program because the company had reached a limit of 200,000 vehicles sold. But the tax credits through the IRA don’t have such a limit, which means more buyers may be able to lower the purchase price of a Tesla this year through the tax credit.
Tesla shares surged 22% in the past week, making it one of the top performers in a portfolio of stocks recommended by Barron’s.
Eric Thayer/Bloomberg
A portfolio of stocks picked by Barron’s has enjoyed a rally in the past week, as the market anticipates the end of the Federal Reserve’s interest rate hikes. A buoyant performance from the auto industry also juiced the portfolio.
The entire stock market has enjoyed a gain in the past week. The S&P 500 is up about 3% in that span, including a pop in the last couple of days. Wednesday, the Fed announced a small interest rate hike, but markets interpreted Chairman Jerome Powell’s comments to mean that the end of rate increases is coming soon.
The rally has helped the average stock in the Barron’s portfolio post a 3.8% gain in the past week. The measure differs from a value-weighted index like the S&P 500, where stocks with bigger market capitalizations have bigger effects on the index.
Almost three quarters of 86 stocks in the Barron’s portfolio are up in the past week, with some of the winners posting mammoth gains. Top performers include Generac
(GNRC), PoolCorp
(POOL) and Olaplex
(OLPX), which gained 15%, 14% and 19%, respectively in the past week.
Some stocks posted even larger gains.
Tesla
(TSLA) gained 22% since last Thursday’s close. In its fourth quarter of 2022 reported on Jan. 25, sales of $24.3 billion beat expectations for $24 billion, while earnings per share of $1.19 came in above estimates of $1.12. Wall Street is confident that, even with the company lowering prices as consumers feel the pain of higher rates, Tesla can keep boosting sales and profit growth. Analysts expect vehicle deliveries to grow 40% from a year earlier to almost 1.85 million in 2023, better than the 31% growth seen in the reported quarter.
“The key debates from here will be on whether vehicle deliveries can reaccelerate (we expect that they will especially starting in 2Q23),” writes Goldman Sachs
analyst Mark Delaney.
Barron’s recommended Tesla stock on Jan. 6, arguing that the the worst of the company’s challenges—including delivery growth—are behind it. The stock is up 67% since then.
Lithia Motors
(LAD), a $7 billion by market capitalization auto dealer, has seen its stock rise 23% in the past week. It reports fourth-quarter earnings Feb 15, but the stock has risen as the picture for auto sales has improved. Tesla’s quarterly performance helped, but so did General Motors‘ (GM). The automating giant reported better-than-expected sales and EPS and said on its earnings call that 2023 will be a “strong year,” one in which analysts expect sales growth.
Barron’s recommended Lithia Motors in April 2022, arguing that the stock was cheap and that production constraints that held sales back would soon be a thing of the past. Since then, the stock is up about 4%.
Lucid Group
(LCID), a $20 billion electric vehicle and battery maker, is up 39% since last Thursday. Earnings are Feb. 22, but strong auto trends already have helped. Lucid, too, is expected to lower prices and aggressively grow deliveries. The stock got a pop late in January on speculation that Saudi Arabia’s Public Investment Fund could buy the rest of the company. The fund recently invested $1.5 billion and holds just over 60% of the company.
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On Friday, Elon Musk appeared on the witness stand in federal court in San Francisco, testifying in a trial brought by Tesla investors. They say Musk’s tweets in 2018 may have crashed the stock price of Tesla, leaving shareholders holding the bag. Musk told the jury, “Just because I tweet something does not mean people believe it …” Correspondent John Blackstone has the story.
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Sources told Bloomberg that the review is part of an investigation into Tesla’s statements about its Autopilot driver assistance system. The “veracity” of Musk’s messaging on the issue is particularly important under the SEC’s rules, Bloomberg noted.
SEC officials are considering whether Musk may have “inappropriately made forward-looking statements” about self-driving cars, a source told Bloomberg. It’s unclear what action the SEC could take if it reached that conclusion.
A message notes that the “person in the driver’s seat is only there for legal reasons. He is not doing anything. The car is driving itself.”
Tesla on Wednesday posted record net income in the fourth quarter of last year as it predicted that additional software-related profits will keep its margins higher than any other automaker.
The Austin, Texas, maker of electric vehicles and solar panels said it made $3.69 billion in profits from October through December, beating analysts’ predictions. The company’s profit was 59% more than the same period a year ago.
Revenue for the quarter was $24.32 billion, which fell short of the $24.67 billion that analysts had expected.
“While every quarter is important for Tesla we would highlight this … as one of the most important moments in the history of Tesla and for Musk himself,” Wedbush Securities analyst Dan Ives said of the much-anticipated earnings call.
“After experiencing unprecedented hyper growth over the past few years in the EV market which was essentially created by Musk, now Tesla faces a darker macro in 2023 with fierce competition coming from all angles,” Ives said. “Adding to that backdrop is Musk who has essentially gone from a superhero with a red cape to a villain in the eyes of many investors after the ongoing Twitter fiasco has cast a dark shadow over Tesla’s stock,” he added.
On January 13, the company cut prices in the U.S. and China, its two biggest markets, by up to 20% on some models, leading many analysts to believe that demand had fallen due to high price, rising interest rates and competition from other EV makers.
Tesla said in its investor letter Wednesday that it would produce about 1.8 million vehicles this year, ahead of a predicted 50% annual growth rate. But the outlook section of the letter didn’t give an estimate of deliveries for the year. Previously Tesla has said its deliveries would grow at a 50% annual rate most years.
Morgan Stanley analyst Adam Jonas wrote in a note to investors early Wednesday that demand is a problem for the company. “In our view, the price cuts are indeed a response to slowing incremental demand relative to incremental supply,” he wrote.
Tesla also said it has rolled out its “Full Self-Driving” software to about 400,000 users, and that it recognized $324 million from Full Self-Driving software during the quarter. Despite its name, “Full Self-Driving” cannot drive itself, and Tesla warns drivers that they must be ready to intervene at any time.
The company said it knows there are questions about macroeconomics in the face of rising interest rates. “In the near term we are accelerating our cost reduction roadmap and driving towards higher production rates, while staying focused on executing against the next phase of our roadmap,” the letter said.
Tesla shares rose as much as 3% in after-hours trading, indicating a positive response from investors to results.
Electric vehicle buyers in the U.S. can now get a purchase tax credit from the government, and it has pushed the price of several high-volume EVs below the average price paid for a new car in America.
There are currently seven high-volume EVs that cost less than the average new car, including two
Tesla
(ticker: TSLA) models. Buyers should look at those if they are thinking about going electric.
Tesla’s Autopilot has never really been the super feature users were promised, and full self-driving mode (FSD) was controversial long before it was introduced. Now, to make things worse for the leading EV manufacturer, a Tesla engineer has testified that a 2016 demo video of the car’s self-driving and self-parking functions was a work of fiction.
Per Reuters, Ashok Elluswamy — software director for Tesla’s Autopilot — admitted in a statement that the video was counterfeit. The admission seemed to affirm a New York Timesreport from 2021, in which anonymous Tesla workers admitted the route taken by the car in the video had been programmed in advance, and the vehicle even had an accident during filming.
As reported by Reuters, Elluswamy’s deposition marks the first time a Tesla exec has acknowledged or even detailed just how the video was fabricated.
Elluswamy said the demo was created after Tesla CEO Elon Musk asked the Autopilot team to design a “demonstration of the system’s capabilities.” However, he claimed the video did not accurately represent Tesla’s supposed self-driving capabilities at the time. Elluswamy’s deposition was part of a suit brought by the family of Walter Huang, a software engineer who died in a Tesla accident in 2018.
Huang family attorney Andrew McDevitt told Reuters that Tesla was “obviously misleading” for presenting “that video without any disclaimer or asterisk.”
Driving assistance software is pretty standard, but in recent years Tesla has been named in relation to several noteworthy accidents involving the feature. Now Reuters reports that the company finds itself on the wrong end of several legal actions related to Autopilot.
The feature is so contentious that California lawmakers enacted legislation preventing Tesla from advertising its cars as fully self-driving until the vehicles are truly capable of autonomous operation.
