Why is Tesla Stock Collapsing: In the last week, Tesla shares have plunged over 40% so far this year, and experts warn that the worst may not yet be over.
Almost 4,000 Cybertrucks were recalled last week, causing the price to drop to about $147 per share, much below the company’s November 2021 high of more than $400. The drop was triggered by the recall.
During Tuesday’s trading, the stock fell to $145 a share.
Tesla’s 2024: Not a banner year
The year didn’t start off well for Tesla, with its January earnings missing both sales and profit targets. The company also reported a 9% drop in revenue in the first quarter, the largest decline in 12 years. Nearly 2.2 million vehicles were recalled over issues with warning lights- almost all of those it sold in the United States.
Tesla’s stock rose 11% in extended trading after CEO Elon Musk said the company could begin producing new, more affordable electric vehicles later this year.
#Tesla Results:
Tesla price peaked out in 2021 at $1.2 TN mkt cap when quarterly sales were ~50% below vs today.
Now with $22 BN sales/qtr, stock is down ~50% from peak.
Storytelling drives new age stocks.
When profits flow, stocks correct.#Nykaa #Zomato #Paytm #PBfintech pic.twitter.com/ipEAu6KF1d— Anurag Singh (@anuragsingh_as) April 24, 2024
Slashing prices has led Tesla’s profits to plunge 18% in the first quarter due to the slowdown in EV sales. Tesla and its competitors have engaged in a price war to boost demand.
In a recent restructuring, Tesla cut more than 10% of its global workforce. The company employs around 140,000 people worldwide, so the job cuts are expected to affect at least 14,000 workers.
Along with the job cuts, two senior executives of the EV company- senior vice president Drew Baglino and vice president for public policy and business development Rohan Patel- have resigned.
Also Read: Elon Musk delays India visit says, Tesla obligations require visit to be delayed”
