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Tesla is having a very rough 2024, but Tuesday may be Elon Musks chance to turn things around for his electric vehicle company.

Are self-driving cars safe enough yet?

The Austin, Texas-based automaker reports its full first-quarter earnings after markets close on Tuesday afternoon, followed by an earnings call with analysts led by Musk, CFO Vaibhav Taneja, and Martin Viecha, the companys head of investor relations.

After a terrible week for the company marked by sweeping layoffs, investors have plenty of questions for Teslas leaders. Tuesday will also reveal more information about Teslas finances, which may have weakened in recent months.

Barclays analyst Dan Levy, for example, expects Tesla to miss Wall Streets estimates and report gross margins that will likely disappoint investors. He also raised the possibility that Tesla may disclose a negative free cash flow for the first time since the first quarter of 2020.

Tesla stock hit a new 52-week low on Friday, falling as low as $146.54 per share. The stock has dropped more than 40% in 2024, making Tesla one of the worst performersin the S&P 500. Tesla stock dropped another 3.4% on Monday ahead of Tuesdays earnings, falling to $142.05 per share a 15-month low.

With questions and concerns weighing on the company, heres what to watch for when Tesla reports earnings Tuesday.

Analysts are warning that Tesla needs to establish and show a new strategy for going forward after a disastrous first quarter and a seeming shift in priorities. Tuesday will be the chance for Musk to reinvigorate uncertain shareholders who still have faith in him as an executive, while others will need what Wedbush analyst Dan Ives calls an adult in the room on the post-earnings conference call for reassurance.

While we have seen much more tenuous times in the Tesla story going back to 2015, 2018, 2020 this time is clearly a bit different, Ives wrote in a note to investors Friday. [F]or the first time, many long-time Tesla believers are giving up on the story and throwing in the white towel.

Tesla also needs to address slowing EV sales growth and reassure investors that it will be able to bounce back from a devastating sales miss last quarter, which tanked shares and raised doubts among investors over the companys short-term performance. Electric vehicle sales in China have been hit as demand softens and rivals like BYD and Xiaomi introduce cheaper models.

The company is preparing for what Musk has called the next phase of growth, which likely emphasizes self-driving vehicles; going balls to the wall for autonomy is a blindingly obvious move, the Tesla CEO said last week.

That represents a dramatic change for Teslas future, which is likely to have an effect on who decides to hold their shares or fold.

We view Teslas shift as thesis-changing, and worry the stock will need to undergo a potentially painful transition in ownership base, Deutsche Bank analysts wrote Thursday, noting that electric vehicle investors may start throwing in the towel and be replaced by AI [and] tech investors with considerably longer time horizons.

Elon Musk has wanted to set up shop in India for a while now but was held back because of the countrys high taxes on imported vehicles. Thanks to a change of heart and policy driven by Teslas rigorous lobbying, thats no longer a problem.

Under strict requirements, New Delhi will allow foreign electric vehicle companies to import up to 8,000 units per year at a 15% tax rate, well below the current 70% or even 100% on most EV imports. Car companies will be required to invest at least $500 million and start domestic manufacturing within three years to qualify for that 15% tax rate.

On Sunday, Musk was expected to travel to India to meet with Prime Minister Narendra Modi for the first time since June 2023, where he was expected to announce a $2 billion investment in the country. The meeting would have given Musk the chance to reassure investors and drive up enthusiasm ahead of Tuesdays earnings announcement.

However, those plans have been postponed.

Unfortunately, very heavy Tesla obligations require that the visit to India be delayed, but I do very much look forward to visiting later this year, Musk wrote on X over the weekend.

Reliance Industries is discussing a potential joint venture with Tesla to build an EV manufacturing facility in India. The conglomerate is expected to have a major role in helping Tesla establish a factory and associated operations, according to the Hindu Business Line.

Tesla has also signed a strategic deal with Tata Electronics to make semiconductor chips for the EV makers global operations, according to the Economic Times. Tata has invested $14 billion into its semiconductor business and has facilities in at least three states.

Eagle-eyed investors dont have look as far away as India for foreign investment plans. Mexico is right around the corner.

Mexican President Andrs Manuel Lopez Obrador first announced Teslas plans for a new gigafactory in Nuevo Leone last February and construction on nearby infrastructure began later that summer. However, construction has been delayed due to Musks concerns about the global economy and various delays in getting permits.

Then in February after permits were approved and $135 million in incentives had been secured Nuevo Leones governor asked Tesla to begin work on the plant in March. Production isnt expected to begin until 2026 or 2027, according to some Tesla suppliers, which may force them to adjust their plans. Collectively, Tesla and its suppliers aim to invest $15 billion into the factory by the end of 2025.

In some good news for Tesla investors, work on the plant hasnt been affected by the companys recent round of layoffs, according to Mexican officials.

We are working on all the infrastructure around the plant, which has to do with all the accesses, we are expanding the road to three lanes, with the water part, we are working on the infrastructure part and we continue working on the incentives, the contact with them is very close, Secretary of Economy Ivn Rivas Rodrguez told Milenio last week.

Perhaps the most hotly anticipated item investors are looking for on Tuesday is one that came well out of left field.

After swiftly denying a Reuters report that Tesla would be dropping plans for a $25,000 electric vehicle which has since been corroborated Musk made his latest promise to investors and fans a self-driving Tesla would be unveiled on August 8. However, its unclear what that announcement will actually entail or if Musk is making another promise he cant keep.

We see a Robotaxi unveiling on August 8 as more aspirational, akin to Teslas Semi and Roadster announcements and not likely to be Teslas next model, Bernstein analysts wrote earlier this month.

In recent months, Tesla has renewed its public focus on its driver-assistance technology, promising frequent updates and free trials. Musk has also reiterated his offer for other automakers to license Teslas Full Self-Driving software, although none have accepted. Tesla has also slashed the subscription price of the software to $99 per month from $199 per month as it looks to increase its collection of user data.

The bottom line is that we believe Tesla is among the leaders in autonomy/ADAS technology, and in the long-term we believe that software & digital services can be a meaningful driver of its business, Goldman Sachs analysts noted on Thursday.

As part of its push toward autonomy, Tesla has shelved its plans to launch a cheap electric car by 2025, which would have filled a much-needed gap in its offerings.

Currently, the Model 3 compact car is Teslas cheapest EV and starts at around $36,000. While cheaper than many competing offerings, Teslas long-promised affordable EV was expected to start at $25,000, making it more of a rival to the ultra-cheap cars sold by Chinese competitors.

But, as Musk continues to deny reports that plans for the affordable EV project have been put on ice, its possible that Tesla surprises investors with some good news.

Deutsche Bank last week downgraded Tesla stock from a buy rating to a hold rating and lowered its price target from $189 per share to $123 per share. The firm had based its buy rating on hopes Tesla would unleash the Model 2 next year.

Now, Deutsche analyst Emmanuel Rosner writes, Teslas future is tied to cracking the code on full driverless autonomy, which represents a significant technological, regulatory and operational challenge.

Tesla has asked investors to re-approve Musks $56 billion pay package that was struck down by a Delaware judge in January. Judge Kathaleen McCormick found that defendants in a shareholder lawsuit, which included Musk and Teslas board, failed to meet the burden in proving that the compensation plan was fair, writing that the process of deciding his compensation was deeply flawed.

Tesla argues that the plan was valid, saying that 73% of shareholders approved the 2018 pay package, according to a proxy statement filed Wednesday. Shareholders will again vote on the package at Teslas annual shareholder meeting on June 13.

Although many investors are likely to approve the package, not everyone is in agreement. Teslas largest retail investor Leo Koguan, who controls more than 27 million shares has been frustrated with Teslas governance practices and told Elecktrek he will vote against the pay package and re-election of two board directors.

Teslas board has been repeatedly criticized for failing to properly push back against Musks demands and habits. His close friend, James Murdoch, and his brother, Kimbal Musk, are both up for re-election to the board in June.

Musks role in Tesla has also been called into question in recent months, as the billionaire demands 25% voting control before growing the companys push toward robotics and artificial intelligence. Besides Tesla, Musk oversees six other companies, including a startup focused on AI, which has raised questions over where his priorities lie.

After issuing mass layoffs last week which coincided with the resignations of two executives Musk now oversees Tesla sales across North America, Europe, the Middle East, and Africa, The Information reports. Hes also taken over oversight of people previously led by Drew Baglino, Teslas senior vice president for energy engineering and powertrain, including the leaders of charging infrastructure and the 4680 battery project.

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Elon Musk's Tesla reports earnings today: Everything to know - Quartz

Elon Musk was described as a pigeon CEO: he comes, shits all over us, and goes, said a former Tesla employee.

Now, the CEO is signaling a focus on Tesla.

Musk has always been an interesting case of a CEO as he has been both CEO of Tesla and SpaceX, two major companies, for nearly two decades.

This is highly unusual, especially when one of those companies is a major public company where the CEO has a fiduciary duty to many retail shareholders.

But things have evidently gotten even wilder in recent years as Musk is now the defacto head of 6 companies: Tesla, SpaceX, X, xAI, Neuralink, and the Boring Company.

Even considering Musks known long days, its impossible for him to be a full-time CEO at Tesla. Several shareholders have expressed concerns about this fact and former Tesla employees who were recently let go in a wave of layoffs last week also confirmed to Electrek that the CEO has indeed been spending a lot less time at the automaker as of late.

A former manager described Musk as a pigeon CEO:

He comes in, shits all over us, and then leaves.

For example, a former employee described how the CEO came in one day to see a newly finished section of Gigafactory Texas, which workers had just finished in a rush that came from Musks own accelerated timeline, just to be told to change the whole wall to glass for seemingly no reason.

Theres a real concern that Musk is not as much in touch with Tesla since buying Twitter and trying to turn the social media platform around.

But the CEO is signaling a change.

Musk is believed to be behind the massive wave of layoffs at Tesla last week that, as we reported, also hid several moves that reshaped programs at Tesla.

The CEO also said yesterday that he is postponing a trip to India to focus on some very heavy Tesla obligations:

Unfortunately, very heavy Tesla obligations require that the visit to India be delayed, but I do very much look forward to visiting later this year.

Coincidently or not, this is happening just as Tesla is asking its shareholders to vote on reinstating Musks massive $55 billion compensation package and the vote is seen as a sort of vote of confidence for the CEO.

I think its very fair to say that Musk has been spending a lot less time working at Tesla in recent years, especially since his acquisition at Twitter. I also think its fair to say that he seems to be coming back to it, for better or worse, in the last few weeks.

It might be because Tesla had a bad quarter, and he thinks that he needs to right the ship, or it might be because an important shareholder vote is coming, and he wants to look like he is spending time on Tesla right now.

Tomorrows earnings call should say a lot.

So far, Musk has blamed Teslas bad performance almost entirely on external factors. It will be interesting to see if that changes and he takes some responsibilities in the future.

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Elon Musk is a pigeon CEO, 'he comes, sh*ts all over us, and goes', says former Tesla manager - Electrek

Tesla shares have had a rough start to 2024, but are surging following its first quarter earnings report on Tuesday where the electric vehicle manufacturer said it wanted to accelerate plans for offering more affordable models. The stock was up about 13 percent in early morning trading.

Teslas (TSLA) first quarter results were disappointing, with revenues down 9 percent from 2023 to $21.3 billion and net income down 55 percent to $1.1 billion. Its stock had fallen more than 40 percent so far in 2024 prior to the first quarter report.

But investors seem encouraged by the companys plans to accelerate the launch of new models, including more affordable options. Tesla previously had targeted the second half of 2025, but said it was moving up those plans to early 2025 or late 2024.

These new vehicles, including more affordable models, will use aspects of the next-generation platform as well as aspects of our current platforms, and well be able to produce on the same manufacturing lines as our current vehicle lineup, Tesla CEO Elon Musk said. So its not contingent upon any new factory or massive new production line.

Morningstar analyst Seth Goldstein raised his fair value estimate for Tesla shares to $200 following the first quarter results and views the shares as undervalued.

Teslas affordable vehicles are a catalyst for shares, Goldstein wrote in a note to clients. Affordable vehicles should eventually generate a majority of its total deliveries. We continue to forecast that Tesla delivers around 5 million vehicles by 2030.

Musk also shared plans about the companys progress towards autonomous vehicles and said it planned to showcase a robotaxi or cybercab in August.

I mean if somebody doesnt believe Tesla is going to solve autonomy, I think they should not be an investor in the company, Musk said.

Tesla has faced challenges as demand has slowed for EVs across the industry and competition from Chinese automakers increased. Earlier this month, Tesla said it would reduce its global workforce by more than 10 percent and two executives left the company.

Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.

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Why Teslas Stock Price Is Surging Heres What Elon Musk Said - Bankrate.com

Ashok Elluswamy, Teslas director of autopilot software, elaborated that unlike laptops and our cell phones, self-driving cars computing power would be totally under Teslas control. So its easier to distribute the workload across different nodes as opposed to asking users for permission on their own cell phones, which Elluswamy called very tedious. Tesla chief financial officer Vaibhav Taneja added that capital expenditure for all that computing power in such a scenario would be shared by the entire world, sort of everyone wants a small chunk, and they get a small profit out of it, maybe. It wasnt clear from the call whether only Tesla-owned-and-operated cars computing power would be monetized, or if vehicles owned by drivers and then rented out to the companys cyber cab service would be utilized, as well.

Musk also said that Optimus, the humanoid robot Tesla has been developing, ostensibly as a means to automate factory operations, will be more valuable than everything else combined, seemingly in reference to the rest of Teslas offerings. Because if youve got a sentient humanoid robots that is able to navigate reality and do tasks at request, there is no meaningful limit to the size of the economy. The same technology, he said, could constitute a terminator-level risk and follow you indoors if theres not some meaningful level of influence over how that is deployed. He said he hopes to start selling Optimus by the end of next year.

Teslas greatest contribution to the world, Musk said, will be solving autonomypresumably by making and selling a bunch of robots. Is autonomy a problem that needs solving? If it were, would a flailing car company be up to the task?

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What the Hell is Elon Musk Talking About? - The New Republic

I was in the car listening to Elon Musks lethargic answers to investor questions yesterday and a long-simmering theory felt like it was being confirmed: Elon Musk doesnt want to be CEO of a car company. Hes bored! Im saying this not as a critique of Musk, because if Im right and hes right then hes creating a company many times more valuable than it is right now.

Is he right? Im less sure. Musks whole life has been a constant doubling-down on every bet and, thus far, its worked out for him. There are signs its not working out as well and thats important.

If you can get through a Musk-heavy Morning Dump I shall reward you with a discussion of Volvos financials, an update on Stellantis and its idiotic quest to alienate all of its suppliers, and a video of me trying to convince GM to build a PHEV Aztek.

Reutershad a story that Tesla was abandoning its $25,000 car, which seemed like a wild assertion and one that Elon Musk said was wrong. Yesterday, Tesla released its Q1 financials and they were bad. Whereas GM saw improving financials and more revenue, Tesla experienced exactly the opposite. The most interesting part of the day, though, was the investor call where CEO Elon Musk answered a bunch of questions.

Musk didnt confirm theReuters story, but he clarified it, and it makes a lot of sense. Heres the full transcript, by the way, that Im quoting from. Heres the key bit:

Weve updated our future vehicle lineup to accelerate the launch of new models ahead, previously mentioned start of production in the second half of 2025. So, we expect it to be more like the early 2025, if not late this year. These new vehicles, including more affordable models, will use aspects of the next-generation platform as well as aspects of our current platforms, and well be able to produce on the same manufacturing lines as our current vehicle lineup.

If youre not a close watcher of Tesla this doesnt mean that much to you, but Ill try to do a quick version of explaining it. Basically, Tesla has been working on an unboxed platform that will allow the automaker to build cars cheaper than anyone else can build cars, including Tesla itself. What I think happened is Tesla moved a lot of people off that team, which is what tipped off Reuters.

What does that mean? Tesla has decided (the timing is unclear and it could have been decided after a negative response to the story) that it is going to build the newer models on a more traditional Tesla platform, which will allow the company to introduce much-needed models much faster by using more of its existing manufacturing footprint.

Thebigquestion about this is can Tesla make a $25k car without the new platform? Fred Lambert, who pays more attention to this than anyone, doesnt think so:

Without the unboxed system, its likely that we can kiss goodbye to the previously mentioned $25,000 price point.

I will have to defer to his judgment on that, though one would think that saving money on re-tooling would help.

This becomes extremely important when considering the companys financial results. Which were bad.

Tesla reported a 9% drop in Q1 revenue, which is the biggest drop in more than a decade and below Wall Streets already lowered expectations. And, yet, shares jumped after the call.

FromCNBC:

The stock jumped in extended trading after CEO Elon Musk told investors that production of new affordable EV models could begin sooner than expected.

Heres the thing, Tesla spent a lot of time working on robots, self-driving, AI, and Cybertrucks instead of focusing on expanding its model line, which is what a normal CEO of a car company likely would have done. This meant that when the EV market slowed down Tesla was forced to heavily discount its inventory because instead of a mix of models it mostly had the same old cars build on the same old platforms to offer.

Ok, back to my premise. When the death of the $25,000 car was reported, I wrote this as my theory for why:

What if Teslas business isnt really cars? I know this is a wild statement since thats a big chunk of the companys value, but Musk is out there working on AI and robots and flamethrowers and tunnels. There are fundamental limitations to the amount of money to be made in the car business and its possible that Musk would rather pivot to the next thing rather than focus on the arduous, slow, and kind of boring work of making cars now that hes got to compete with BYD, and. Xiaomi and a bunch of other companies.

This call confirmed this theory. There was way more talk of everything that wasnt cars than actual cars. And Musk explicitly said the following on the call:

If you value Tesla as just like an auto company, you just have to fundamentally, its just the wrong framework and if you ask the wrong question, then the right answer is impossible. So, I mean, if somebody doesnt believe Tesla is going to solve autonomy, I think they should not be an investor in the company. Like that is, but we will and we are and then you have a car that goes from 10 hours of use a week, like an hour and a half a day to probably 50%, but it costs the same.

Thats it. If you think Tesla can make humanoid robots, autonomy, AI, et cetera work then it is so much more valuable than the company is today and the share cost is way low and you should buy shares in Tesla. If you think thats all a shell game you should run like hell.

Ive got my sense of what reality is, but that sense has to contend with a universe in which betting against Elon Musk has almost never worked out for anyone.

Volvo definitely isa car company, and its Q1 financials reflect that. Sales were up in Q1 2024 by about 12% compared to Q1 2023 and EBIT margins hit 7.2%, compared to the same period in 2023 when margins were 6.6%.

The company is actually well-positioned in the marketplace with a strong mix of EVs and PHEVs. Total revenue for the company did fall, and the company blamed contract manufacturing (ahem, Polestar):

That and foreign exchange rates have been a bit of a drag. Volvo has a solution to the Polestar issue, though, and thats giving back Polestar to its investors (and Geely).

Stellantis, under CEO Carlos Tavares (pictured above), is playing a dangerous game with its suppliers, which is what the company does when its not antagonizing governments.

As previously reported, Stellantis is trying to keep parts costs low and has told suppliers they can no longer submit claims related to price increases.

On the Stellantis side, the company is essentially saying that it has contracts and its tried to help out as much as possible to offset inflation/supply chain-related pressures on its suppliers but it also has to worry about its own margins.

On the supplier side, these companies are pointing out that during the pandemic Stellantis made humongous profits while they got the squeeze and havent been made whole yet.

Suppliers have threatened to stop delivering parts and Stellantis has decided to stop paying certain suppliers. This has led to a flurry of court cases, and the most recent has come down against Stellantis. Heres the key bit fromAutomotive News:

Two of the cases are being handled by Judge Victoria Valentine, who granted court orders this year forcing Yanfeng and Kamax to continue supplying parts while the cases work through the court.

But Judge Michael Warren, the circuit courts other business judge, departed from those decisions by denying a preliminary injunction against MacLean-Fogg Component Solutions LLC. Despite FCAs oral argument that such circumstances will cause other suppliers to similarly threaten to stop shipping parts when they want a price increase, causing disruption of the entire United States auto industry, FCAs argument is speculation and conjecture, Warren said in the order.

Hold on, it gets better:

In the April 9 lawsuit filed against the supplier, lawyers for Stellantis argued the financial impact on FCA will be catastrophic and will cause tens, if not hundreds, of millions of dollars in shutdown damages, in addition to the incalculable losses from being shut out of future supply work with its suppliers and losing various employees due to forced layoffs.

In Tuesdays order, Judge Warren shot down the automakers claim of a risk of irreparable harm. This cascade will only occur if FCA refused to pay under protest, the judge said in the opinion. Akin to a civil contemnor, who holds the key to her own jail cell, FCA can avoid this impending economic disaster by paying under protest.

Looooooool. Its not fun to pay under protest, but thems the breaks (unless, of course, Stellantis tries to short its brakes supplier).

I had a great chat yesterday, above, with ABC 12 and a familiar voice around here (spartanjohn113). Mostly we talked about GMs Q1 results, and it did give me an opening to float my pet theory of what GM should do next.

Specifically, I challenged GM, Mark Reuss, and Mary Barra to build a cool, affordable crossover PHEV with a tent and call it Aztek. I also said, specifically itll sell. However, I did add: You have my word which is not trustworthy at all in this case.

Its not! Never build a car an automotive journalist asks for, it only ends in heartache.

Mark (who, in addition to being a car dude is also President of GM) found it funny, at least:

Maybe not confirmation of a GMC Aztek, but at least Im getting a sweet lapel pin! Thats a consolation.

I love Chromeo. I got to see them perform in Houston at a Basquiat exhibit (the most Millennial sentence ever written) and met Dave 1 and P-Thugg and they were delightful. Not only is their music smooth and funky as hell, all their videos seem to feature great cars, including the white Camaro in this video.

Fast forward a few years and Im living in Brooklyn and Im in search of a parking garage to ditch press cars. There are a few to choose from, but the best choice seems to be the one run by a guy with an Infiniti M30 convertible. He gets me.

One day while Im down there I go exploring the cars in the garage and theres a white Camaro convertible. I blurt out very Chromeo and he goes Oh yeah, thats P-Thuggs cars, he keeps some of his rides here. So, for a few years, I shared a parking garage with Chromeo. I will never get cooler.

Is Elon Musk running a shell game or is Tesla the future of everything? Or some other answer?

Top photo: NBC Universal/SNL Screenshot

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Elon Musk Clearly Doesn't Want To Be CEO Of A 'Car Company' Anymore - The Autopian