Tesla is not going through its best moment and Elon Musk knows it. After the business call on October 18, where he acknowledged the company’s difficulties, This week a new drop in shares is added.
Shares fell about 5% on Monday, closing at $197.36, after updates from Panasonic, its battery cell supplier, will reveal a reduction in production.
Since the third quarter results report, on October 18, Tesla shares have fallen 18%. And things might not get better.
Panasonic announced this week that reduced battery cell production in Japan during the period ending September 2023.
This points to the fact that Demand for Tesla electric vehicles also decreased, especially cars that do not qualify for tax breaks and other government program incentives.
Panasonic battery cells have been used by Tesla for the X SUV and the Model S.
In the last third quarter earnings call, Elon Musk warned shareholders that interest rates were putting pressure on the company so that it would keep the price of its electric vehicles lower.
This could hinder the ability of consumers to purchase or lease electric vehicles in the future.
He also revealed that there are problems with the Cybertruck due to prices: “We dug our own grave with him,” said Elon Musk. “It’s a great product, but financially it will be a year to 18 months before it contributes significantly to positive cash flow.”
Since then, Tesla shares have fallen more than 18%. Bernstein analyst Toni Sacconaghi reported that Elon Musk’s company is expected to “experience lower margins and volume disappointments” in fiscal 2024.