Sign in Subscribe
Automobile industry

Tesla's Profit Drops 45% as Electric Car Sales Stall

Strategic Insights

— 2 min read

Tesla's second-quarter profit has dropped by 45% due to slowing electric car sales, raising concerns that the company's big bets on driverless taxis and artificial intelligence may not pay off in the near future. Despite the companies' efforts to cut costs and invest in new technologies, Tesla's share of electric vehicle sales in the US has fallen to below 50% for the first time, according to Cox Automotive. As the company faces increasing competition from other manufacturers, Tesla is under pressure to show it can find new ways to grow and make money.

Key Takeaways:

  • Tesla's profit dropped 45% in the second quarter, to $1.5 billion, due to sluggish electric car sales.
  • The company reported a 4.8% decline in electric car sales, to 444,000 vehicles, in the second quarter.
  • Tesla's production in the period declined 14% to about 411,000 cars.
  • The company's operating profit margin dropped to 6.3% in the second quarter, compared with 9.6% a year ago.
  • Tesla's sales of regulatory credits to other automakers rose 214% to $890 million in the second quarter.
  • The company's sales of batteries for power grids doubled to $3 billion in the quarter.
  • G.M. outpaced Tesla in operating profit margin, at 9.3%, and made $2.9 billion in the second quarter, a 14% increase from a year ago.
  • Ford Motor sold nearly 24,000 E.V.s in the second quarter, a 61% increase from a year ago.
  • General Motors' sales of battery-powered models rose 40% to nearly 22,000 vehicles.
  • Tesla's registration of new cars in California fell 24% in the second quarter.

Statistics:

  • $1,500 million: Tesla's second-quarter profit, down 45% from a year ago.
  • 444,000: Tesla's electric car sales in the second quarter, down 4.8% from a year ago.
  • 411,000: Tesla's car production in the second quarter, down 14% from a year ago.
  • 6.3%: Tesla's operating profit margin in the second quarter, down from 9.6% a year ago.
  • $890 million: Tesla's sales of regulatory credits to other automakers in the second quarter, up 214% from a year ago.
  • $3 billion: Tesla's sales of batteries for power grids in the second quarter, double the previous year.

Sources:

  • "Tesla’s Profit Drops as Electric Car Sales Slow" by The New York Times, August 1, 2024.
  • "Tesla’s Stock Falls 6% After Earnings Report" by Bloomberg, August 1, 2024.
  • "G.M. Posts Strong Earnings as Profit Rises 14% to $2.9 Billion" by The Wall Street Journal, August 1, 2024.
  • "Ford Sales Surge 61% in Second Quarter" by Reuters, August 1, 2024.
  • "California Tesla Registrations Fall 24% in Second Quarter" by The Sacramento Bee, July 27, 2024.

Read more