WASHINGTON: Tesla on Wednesday reported its second consecutive quarterly profit decline, hit by a drop in vehicle deliveries, reported German news agency dpa.
The electric carmaker, founded by billionaire Elon Musk, posted net earnings of US$1.17 billion in the latest quarter - a 16 per cent decrease compared with the same period last year.
Revenue also fell 12 per cent to US$22.5 billion, slightly below analysts’ expectations of about US$22.7 billion.
A key factor behind the decline was a 13.5 per cent fall in deliveries, down to 384,122 vehicles. The new version of the bestselling Model Y, which has been delivered to customers since March, has not yet been able to boost sales.
The transition phase for the Model Y, along with controversies surrounding Musk’s political activities, was seen as a reason for the 13 per cent drop in sales in the first quarter.
Electric vehicle subsidies near end
The company also faces mounting competition, especially from Chinese automakers, who are making strong gains outside the US market. In Europe - where Tesla operates a factory near Berlin - sales have been slipping for several months.
Meanwhile, Musk continues to push Tesla’s future in autonomous driving and robotics. In June, Tesla launched its first robotaxi service in Austin, Texas. However, only a limited number of Model Y vehicles are currently active, and rides are available exclusively to selected users.
While the cars operate without drivers, a Tesla employee accompanies each trip in the passenger seat for safety.
Tesla’s automotive revenue dropped 16 per cent to US$16.66 billion in the second quarter. However, the company could see short-term momentum in the coming months thanks to US President Donald Trump’s policies, as electric vehicle subsidies in the US are set to expire at the end of September. This may prompt some buyers to make quick purchases.
Following the quarterly results, Tesla shares edged up about 0.5 per cent in after-hours US trading. - Bernama, dpa
