Wed, 23 Jul 2025

Wed, 23 Jul 2025 Tesla pledges to make cheaper cars as issues mount

Elon Musk's carmaker says a more affordable Tesla model is coming as it reports a steep drop in revenue.
Tesla plans to launch cheaper cars and gain approval for its self-driving software in Europe this year. The company reported a significant decline in car deliveries and profits, citing US government support cuts, competition from Chinese carmakers, and Elon Musk's controversy surrounding his political activities as contributing factors. The company posted a 12% drop in revenue and a 16% fall in profits over the last quarter. Tesla attributed the decline to a $300m loss due to US tariff policy and warned of further economic pain ahead. Tesla expects its sales in Europe to increase once customers are allowed to use its self-driving software, which is expected to be approved first in the Netherlands and then by the European Union. The company's profit margins have shrunk sharply over the past year, with profits down in five of the last six quarters. Tesla's shares have fallen about 30% since Musk's support for Trump helped him win the White House. Investors are concerned that Musk's focus on politics is distracting from his duties as CEO and are calling on the board to determine whether his political ambitions are compatible with his role at the company. Analysts say that while launching a new, affordable model will help Tesla, it may not be enough to fix the company's problems. The firm faces stiff competition from established carmakers and needs to go beyond just releasing another vehicle to regain its footing in the market.
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