Tesla’s Q1 2025 Crash: Profits Plunge 71% as Elon Musk Promises a Comeback
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I do admit this is a somewhat dramatic choice of words, but what happened at Tesla in the first quarter of 2025 was, strictly speaking, quite the crash landing. Sales and profits plummeted to such an extent that even CEO Elon Musk no longer has the option of simply letting everything operate as before. Due to his numerous engagements in the political environment under the eyes of US President Donald Trump, he wants to step on the brakes for now and devote more time to his companies, Tesla included.
Tesla Posted a Massive Drop in Profits
First things first: Between January and March, Tesla's profits plummeted by an impressive 71 percent to $409 million compared to the corresponding period last year. What about its turnover? That is also in the doldrums, namely a drop of 9 percent to $19.3 billion. Analysts had expected completely different figures earlier, with forecasts of up to $21 billion.
The primary reason for the poor figures? Elon Musk's questionable public appearances have caused Tesla's image to suffer massively. The logical consequence amounts to this: fewer cars are being built, and fewer electric vehicles are being delivered to customers. In the first quarter alone, deliveries fell by 13 percent to just under 337,000 vehicles.
In Germany, sales fell by an enormous 62 percent, and the picture is not any rosier in China and the USA. Fingers crossed the new Model Y will be able to turn things around. After all, it has only just been launched and should only be able to play a role in the sales figures for the second quarter.
Musk Wants to Focus More on His Company(s) Once More
How will Elon Musk react? He announced at an investor conference on the latest quarterly figures that he wants to focus more on Tesla once more from May. He only wants to work for the US government "one to two days a week". Government jobs are only a minor matter for him "as long as the President wants me to."
Musk does not expect to see a noticeable upturn at Tesla until the second half of 2026 at the earliest. By then, the "financial needle" should finally be pointing upwards again and the company should “grow exponentially” again.
These words were lapped up by the stock market. Despite the poor financial figures, Tesla shares rose by five percent in post-market trading. Even the continued trading spat between the USA and China did not have any negative impact.
