Blue Whale Reporter Hao Yan
Tesla seems to be in a dangerous situation
Since April, there have been constant news of Tesla's price cuts and layoffs, and after the clearly unexpected financial reports were released, everything finally came together.
Tesla is embroiled in a price war
Since 2024, the new energy vehicle market has almost entered a price war, and the magnitude and frequency of price reductions by car companies have dazzled car buyers and onlookers. This atmosphere became even more tense after the Xiaomi SU7 entered, and even Musk couldn't sit still and joined the price war.
Shortly after the announcement of the price increase, on April 21, Tesla China's official website announced that the price of all Tesla models in Chinese Mainland had been reduced by 14000 yuan. At the same time, on April 20th, the official US website announced that Tesla's Model Y series prices in the US have been lowered by $2000, while Tesla's Model Y model has been lowered to $42990.
In less than three days, Tesla's "big treat event" is still ongoing.
On April 24th, Tesla announced its latest promotional offer on Weibo: launching a zero down payment promotion. The discounted models are applicable to pre order models of Model 3 and Model Y specified versions, and the promotion period ends on June 30th.
The Blue Whale reporter contacted Tesla sales and learned that, taking the Model Y model that participated in the above activity as an example, a deposit of 1000 yuan is required in advance for a zero down payment purchase, and monthly payments will begin at a 2.5% interest rate, with a 60 period period for the entire cycle. However, the salesperson also stated that a zero down payment requires a high level of credit from car buyers, "there should be no overdue payments, and the debt should not be too high. A bank pre examination is required to determine whether one can participate in the zero down payment car purchase activity."
The further reduction of the car purchase threshold shows that Tesla's sales pressure is not small.
As a leader in the industry, Tesla has always been a bystander in the competition among new energy vehicle companies. Its deep participation in this event has also attracted the attention of peers, including the recently thriving Lei Jun.
At yesterday's Xiaomi investor conference, Lei Jun also talked about Tesla's recent price reduction controversy. Lei Jun said that Tesla had lowered its prices by 14000 yuan on April 21, which made him very impressed by Musk. "Tesla is also a friendly business to us, and I think the best way to deal with competition is not only through price wars, but more importantly, product strength," said Lei Jun.
Withdrawing offers from fresh graduates has also affected some social recruitment personnel
Tesla's pressure is also transmitted to specific employees and potential employees.
On the afternoon of April 15th Beijing time, Tesla CEO Elon Musk issued an internal letter stating that he would lay off 10% of employees worldwide. According to relevant data, as of the end of 2023, Tesla had approximately 140500 employees worldwide, and a 10% layoff rate means that over 10000 employees will lose their jobs at Tesla, which is expected to be the largest scale of layoffs by Tesla since 2017.
This round of layoffs has also affected Tesla China. According to Interface News, Tesla China's layoffs cover multiple departments, and sales personnel are in the "hardest hit area".
On April 24th, Tesla's layoffs further expanded their scope, affecting not only sales personnel but also school enrollment.
According to IT Home, Tesla has cancelled all offers (admission notices) for fresh graduates in China. Netizens who were reneged on by Tesla posted on social media that as the spring recruitment was about to end, they suddenly received a notice from Tesla to withdraw their offer. Tesla offered a unified compensation at the end of one month's salary, but it was very difficult to find a job at this time. Once the recruitment failed and they lost their status as fresh graduates, it would be even more difficult to find a job.
In addition, Blue Whale reporter learned that in addition to school enrollment, there are also social recruitment personnel whose offers have been withdrawn.
Recently, Jack, who had previously received a social recruitment offer for positions related to Tesla's supply chain, was informed that the offer had been withdrawn at the request of the headquarters. However, due to the signing of a confidentiality agreement, the compensation plan could not be disclosed.
According to Bloomberg cited by Global Times, in an email sent to employees on April 17th local time, Musk admitted that the severance pay for some laid-off employees was "too low". Musk stated in the email, "During our restructuring of Tesla, I noticed that some severance pay was mistakenly lowered." I apologize for this mistake and am immediately correcting it. "
The first quarter financial report did not meet expectations, resulting in a significant decrease in net profit
Both price cuts and layoffs are Musk's way of dealing with the current crisis. On April 23rd, Tesla released its first quarter 2024 financial report, which did not meet expectations in both net profit and delivery volume.
Specifically, Tesla achieved a revenue of $21.301 billion in the first quarter, a year-on-year decrease of 9%, slightly lower than analyst expectations of $22.3 billion; The net profit was 1.129 billion US dollars, a year-on-year decrease of 55%.
In addition, Tesla's global delivery volume in the first quarter was 386810 vehicles, far below the expected 449080 vehicles, marking the first quarterly year-on-year decline in Tesla's delivery volume since 2020. According to the financial report, the company experienced many challenges in the first quarter, and it is expected that this year's delivery volume may be lower than last year. It still expects a "significant decrease" in sales growth rate in 2024.
Like many domestic new energy vehicle companies, Musk will also launch low-priced models to boost confidence and sales. During the earnings conference call, Musk stated that the launch of Tesla's new models is accelerating, including a cheaper car. These vehicles will use existing and new platforms and be produced on the company's existing production lines. In addition, Musk predicts that by the end of this year, the Optimus Prime humanoid robot will have the ability to perform tasks in factories. Musk believes that among all humanoid robot manufacturers, Tesla is most likely to achieve mass production.
It is reported that Tesla rose over 13% after the market due to this news. Previously, Tesla's stock price has fallen by over 40% this year, reaching its lowest level since January 2023.