Elon Musk, CEO of Tesla.
Antonio Masiello | beautiful images
Tesla Shares fell more than 8% in pre-market trading in the United States after the electric car maker reported second-quarter earnings that missed expectations due to ongoing pressure on its auto business.
Elon Musk’s electric car company reports auto sales down 7% year-over-year in the June quarter to $19.9 billion while it Adjusted profit margin also decreased.
The company has been forced to cut prices globally and offer discounts and incentives amid slowing sales and increased competition, especially in China – one of its key markets.
Tesla shares are down nearly 1% this year so far, while S&P 500 has increased by more than 16%.
Tesla remains the top-selling electric carmaker in the United States, but is losing market share to a growing number of competitors, in part due to aging sedans and SUVs and the impact of Musk’s flammable and political commentary.
Bulls and bears are battling over the stock, with some believing the company’s core auto business is under pressure, while others remain hopeful about the future Musk has promised around self-driving cars, AI and robot taxis.
The market has focused on a number of other areas surrounding the Tesla story, including when the company will introduce a new mass-market vehicle to refresh its lineup. Musk said on an earnings call on Tuesday that Tesla is on track to deliver a new “affordable” vehicle in the first half of next year.
Robotaxis was a big focus on the earnings call. Musk envisions a world where owners could allow their Teslas to be used as part of an Uber-style ride-hailing service — and where the cars would drive themselves.
When asked when he expected the first robot taxi to take off, Musk replied: “I’d be surprised if we couldn’t do it next year.”
Musk has a history of making promises on specific timelines and failing to deliver. On Tuesday, Musk pushed back the company’s robotaxi event to October, after previously saying it would take place in August.
“This is because I want to make some major changes that I think will improve the car,” Musk said, adding that Tesla “will show a few other things as well.”
Musk did not specify what these items were.
– CNBC’s Lora Kolodny contributed to this report.
