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HomeNewsBusinessElon Musk’s Tesla raises prices to keep up with escalating costs

Elon Musk’s Tesla raises prices to keep up with escalating costs

Tesla’s results on Wednesday beat Wall Street expectations, with higher prices shielding electric-car makers from supply-chain disruptions and higher costs. Tesla has been an outlier since the pandemic began, posting record shipments and profits for several quarters as rivals halted production as they dealt with disruptions in global supply chains. Tesla shares rose 6% after the close. CEO Elon Musk said on an investor conference call that Tesla has a reasonable chance of achieving 60% growth in car shipments this year, and a 50% annual growth rate over the next few years. He said he was confident he could.

Tesla said chip shortages and the recent COVID-19 outbreak have weighed on its supply chain and factory operations, with prices of some commodities skyrocketing several-fold in recent months.IBES data from Refinitiv The world’s most valuable automaker had sales of $18.8 billion in the first quarter that ended March 31, compared with an estimate of $17.8 billion, according to the company. This is 81% more than the previous year.

His Craig Irwin of Roth Capital said: “The Chinese production issue appears to be well managed and we expect Austin and Berlin to make up the backlog from the 19-day shutdown in Shanghai.” Tesla has raised prices in China, the US and elsewhere after Musk said in March that it was facing significant inflationary pressures on goods and logistics amid the crisis in Ukraine. “Our factories have been below capacity for several quarters as our supply chain has become a major limiting factor, likely to continue through the end of 2022,” Tesla said in a statement.

Proceeds from the sale of regulated loans to other automakers were $679 million in the first quarter, up 31% year-over-year and helped boost revenue and earnings. Earnings per share were his $3.22, beating analysts’ expectations of his $2.26. Tesla’s earnings before tax (EBITDA) per vehicle delivered increased more than 60% year-over-year to $16,203 last quarter. Tesla closed its factories in China for about three weeks before gradually resuming production this week.

Musk offered to buy Twitter last week, raising concerns that he could sell some of his stake in Tesla or borrow more Tesla stock to fund a $43 billion bid. Investors also fear Musk will be distracted by electric-car makers ramping up production at new plants in Berlin and Texas.

“Limited production has recently resumed, but we continue to monitor the situation closely,” Tesla said Wednesday. Tesla, which does not promote its own products, said it saw a spike in vehicle orders the day after the Super Bowl game, when other automakers aired a series of commercials about their electric vehicles. For example, the Polestar ad, endorsed by Leonardo DiCaprio, attacked Tesla and Volkswagen. Musk said on an investor conference call that Tesla expects to mass-produce robo-taxis without steering wheels or pedals by 2024.

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