Elon Musk still has his own company to run. Here’s what happened with Tesla earnings
Original story:
Excitement over Elon Musk’s attempted hostile takeover of Twitter has buried the fact that he still has his own companies to run. Not least of them Tesla—the engine that drove Musk to become the world’s richest man, and supplied him with much of the $43 billion for the Twitter offer.
The electric car company will release its quarterly earnings after the stock market’s closing bell on Wednesday. And Wall Street is expecting a strong report, after Tesla delivered an all-time record number of vehicles in the first quarter—up nearly 70% year-over-year—despite supply-chain challenges and factory shutdowns. Those sales comprise the vast majority of Tesla’s revenue, which analysts are predicting to be $17.7 billion—up over 70% from last year.
The outlook may be bullish, but the earnings call won’t necessarily be a victory lap for Tesla. Here are some of the big questions it may need to answer:
What’s happening in China?
Tesla’s Giga Shanghai factory suspended work on March 28, due to strict COVID-19 containment measures amid a rise in the country’s cases. The idling came at the end of the first quarter, and is likely to make a bigger dent in the company’s second-quarter results, as the Shanghai factory is its largest by output and could see a reduction of about 90,000 vehicles over these weeks, according to Credit Suisse estimates. Tesla previously said it’s targeting 50% growth in production by next year, but some are wondering if that’s still possible given recent setbacks.
Worse, however, is a report from Bloomberg this week that described Tesla’s return-to-work rules for Shanghai staff operating in China’s closed-loop system, which requires employees to sleep on the factory floor with company-provided sleeping bags, shower in still-unfinished on-site facilities; and work 12 hours a day, 6 days a week, until at least May 1. While it’s not uncommon for manufacturing plants in China to have dormitories for workers, Tesla’s factory is not currently equipped with such living spaces.
How are the new factories coming?
Tesla just constructed two new factories, near Berlin and Austin, Texas. Both began shipping in the past few weeks. How quickly can they ramp up production? Austin’s factory will build the long-awaited Cybertruck pick-up and Semi trucks, the former of which was first unveiled in 2019 and has been delayed several times to 2023, much to fans’ dismay. Can the company still stick to that goal?
Are there more details on the robotaxis?
At the opening of the Austin factory earlier this month, Musk said Tesla would make a robotaxi that would “look futuristic” and feature fully self-driving technology, but did not give a timeframe, Reuters reported. It’s the latest of Musk’s claims to eventually achieve fully self-driving cars, although he has thus far failed to do so.
Is the next part of the Master Plan ready to go?
Last month, Musk tweeted about his “Master Plan Part 3,” supposedly the next installment in a grand life scheme that encompasses all of his various projects. For Tesla, he said it would focus on “scaling to extreme size, which is needed to shift humanity away from fossil fuels, and artificial intelligence.”
What’s the status on Twitter?
Is Musk still trying to buy it? If so, he could potentially end up in charge of five major companies, between Twitter, Tesla, SpaceX, Neuralink, and The Boring Company, not to mention any smaller ventures that pique his interest. Can he juggle all of these without dropping the ball?
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