MUSK TO CUT BACK DOGE WORK AFTER TESLA SALES SKID – Tesla shares spiked to trade up 5.5% on his comments
Tesla CEO Elon Musk said he would cut back “significantly” the time he devotes to the Trump administration from next month and spend more time running the electric-vehicle maker.
Tesla shares, which had risen 4% in after-hours trading right before an earnings conference call began, spiked to trade up 5.5% on Musk’s comments.
After market close, Tesla reported profitability for its core auto business that topped rock-bottom expectations and said it was on track to produce an affordable car, offering some hope to investors as sales have dropped.
But the EV maker said it would have to reassess its growth forecast in three months because it was “difficult to measure the impacts of shifting global trade policy on the automotive and energy supply chains.”
“Uncertainty in the automotive and energy markets continues to increase as rapidly evolving trade policy adversely impacts the global supply chain and cost structure of Tesla and our peers. This dynamic, along with changing political sentiment, could have a meaningful impact on demand for our products in the near-term,” it said.
Tesla has paused some China-sourced component imports after U.S. tariffs on the Asian country rose. China has responded with tariffs of its own, leading Tesla to suspend new Model S and Model X orders in the country.
But its stronger-than-expected margin in the first quarter offers some relief, as its cost of making and selling vehicles dropped over 17% year over year, driven by lower raw material prices and reduced expenses of ramping up Cybertruck production.
The company has said it plans to release a cheaper car in the first half of 2025 using existing platforms and assembly lines, after scrapping plans for a brand-new, low-cost model.
