Tesla’s
latest earnings miss was having an impact beyond the company.
The electric-vehicle maker on Wednesday reported lower-than-anticipated earnings after price cuts hit margins.
Tesla
(ticker: TSLA) shares were down 5.1% in premarket trading Thursday, after having declined about 5% in regular trading hours Wednesday.
That stock drop seemed to spread to Tesla’s Chinese rivals. In Hong Kong trading Thursday,
BYD
(BYDDF) closed 3.7% lower.
Li Auto
(LI) and Geely (GELLY) posted similar declines. XPeng (XPEV) and NIO (NIO) finished down 9% and 8%, respectively. In premarket trading in the U.S. Thursday, XPeng was down 2.3%, Li Auto was off 2.2%, and NIO declined 2%.
Tesla’s U.S. competitors met a similar fate.
Rivian
(RIVN) and
Lucid
(LCID) each dropped about 9% on Wednesday and were heading even lower in the premarket.
The worry is that the EV price war is getting more serious and is going to hurt everyone in the market. While Tesla still boasts a healthy profit margin, others are selling their cars at a loss. They still need to ramp up production and efficiency before they can actually start making money on sales.
Tesla CEO Elon Musk said deliveries of the new Cybertruck won’t significantly contribute to profits until 2025. He complained about everything from interest rates to the company’s growth on a call with investors Wednesday afternoon, arguing that the trading environment is difficult.
“Tesla is an incredibly capable ship,” he said. “Even a great ship in a storm has challenges.”
Write to Brian Swint at [email protected]
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