25 January 2024
If you are covering Tesla’s latest financial results, please find below a comment from Ben Barringer, technology analyst at Quilter Cheviot:
“Tesla delivered slightly weaker than expected results as it gets buffeted by a struggling consumer environment, as well as higher interest rates. Sales growth is warned to be notably lower in 2024 and it is perhaps not a surprise given Tesla’s pipeline. The Model Y SUV contributes a significant amount of sales to Tesla’s overall figures, but demand growth is falling now. It does have a new low cost car in the works but this won’t start being delivered until 2026, so we are in a period where there is little growth to be expected anytime soon.
“That said, the economic environment is improving and interest rates will start to come down. This will be a real positive for Tesla, as well as the wider automotive sector, as consumers tend to buy their vehicles on finance. Furthermore, its robotics and automation divisions continue to deliver solid results and it will see some growth from the recently launched Cybertruck. For investors, the long-term trends that have powered Tesla is recent years remain present, however, they will need to ride out these growth waves. Despite the sales challenges, it remains a quality product company and should benefit from a normalisation in interest rates going forward.”
