Tesla Is Circling The Drain
What a trash fire.
Tesla is about as popular as syphilis at the moment. Tesla hate is just as contagious, with people on either side of the political line despising the brand for a million different reasons. Who thought associating a company with left-wing products with an authoritarian right-wing government would end so badly? But, despite this, Tesla feels too monolithic to come to harm. Like it can shrug this off and keep on trucking, but that isn’t true. Tesla is staring death in the face. Let me explain.
Tesla’s European sales are doing about as well as Musk’s relationship with his transgender daughter, Vivian. It’s an embarrassing shit show of Musk’s own making.
Tesla sold just 512 cars in the UK this April, which is 62% less than in April 2024. These figures are so abysmally low that two brand-new, obscure Chinese EV makers, Jaeco and Omoda, outsold Tesla by a factor of two. For some comparison, Tesla’s main global competitor, BYD, sold 2,511 cars in the UK this April, and an increase of 650% from last year.
The same is true throughout Europe. Tesla is posting over 50% decline in monthly sales in France, Sweden, Denmark and the Netherlands. And posting negative year-to-date sales in every single EU country.
It’s not surprising that the continent that still bears the noticeable scars of WW2 has rejected Musk so unanimously.
But it’s not much better over the pond. Musk’s Cybertruck is like Pope Leo deciding to celebrate his new position by launching a line of personally branded condoms. Not only is it in extremely bad taste, but it will be a sales flop, and we are seeing that play out. Last month, Tesla had 2,400 Cybertrucks in inventory. Now, that figure is 10,000, and that is after Tesla massively scaled down Cybertruck production. It’s almost like Tesla hasn’t even sold a single Cybertruck for a month.
That is the equivalent of $800 million of product that Tesla can’t shift. And with demand for Cybertrucks half that of what it was last year, they likely never will. Particularly as Tesla has scrapped the Cybertruck range extender, meaning most Cybertrucks will have a real-world range the wrong side of 250 miles.
The Cybertruck was Tesla’s $2 billion ill-advised gamble to secure a wild sales future. That gamble has failed, hard.
However, I can hear Tesla fans arguing that sales don’t matter because Tesla will generate revenue from self-driving technology. An idea so laughable, I fall out of my chair whenever someone makes such a claim.
Firstly, as I have covered a million times (read more here), FSD is computer vision only, and lacks redundancy because Musk is as tight-fisted as they come. As such, it is wildly dangerous and unfit for even supervised self-driving, let alone full automation. As such, their Cybercab is set to be far behind the already operational competition, like Waymo.
But it gets so much worse than that. Tesla has sold millions of cars with the promise that one day, they will be able to drive themselves. However, he recently admitted that the computer they have been installing in Teslas isn’t powerful enough for this, and will need to be replaced. Thanks to Musk’s promises and consumer protections, that will have to be at Tesla’s cost. Such an upgrade costs around $1,500, and there are 4 million Teslas that need this. So, Tesla could be forced to spend $6 billion updating its cars!
Considering that Tesla made only $7 billion in profit last year, and its profits are seriously down this year, that is a cost high enough to send Tesla into the red for years. But, even after shelling out all that dough, Tesla’s still won’t be able to self-drive even remotely safely. The computer isn’t the weak link; the entire setup is inherently flawed.
So, no, Tesla’s self-driving lies won’t save the company from falling sales.
Tesla’s profits are already down by over 70% this year. As emission credits made up over 30% of Tesla’s profits last year, Tesla is likely currently making zero profit from the sale of each car. And those credits are going away. Firstly, as Tesla’s sales fall away, they will have fewer credits to sell. But also, most automakers are building their own EVs now, and are starting to sell them in massive numbers, meaning demand for these credits could easily plummet over the next year or two.
In short, Tesla has a one-way ticket to posting annual losses.
Now, sure, Tesla ran for years without ever coming close to posting a profit. But it was rapidly expanding and leapfrogging the entire market, making this lack of profit palatable. With their sales crashing and technology now looking old-school or just fundamentally broken, can the company survive a lack of profit?
The life support machine is beeping, and the gaps between them are lengthening. This once beloved company lies limp and sweaty, as its death rattle echoes around the room. All while Musk is rifling through its hung-up coat to find some loose change to buy some more ketamine. It’s a sorry sight, but, looking back, is it really surprising it ends like this?
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Sources: This Is Money, CNN, PE&B, Car Wow, Reuters, Electrek, Forbes, CarbonCredits.com, Politico, Mashable, Business Insider
Spot on. One day, probably soon, institutional investors will wake up and begin exiting their positions, and that will cause huge amounts of volatility that the retail MAGA investors and MUSKrats will no longer be able to keep their stock at a ridiculous valuation.
Then the shit will hit the fan good, and my supply of Popcorn will come in handy
It kind of seems like investors don’t care about Tesla’s core business, as long as they still believe in the Cybercab.