Tesla CEO Elon Musk said the company has “paused” plans for its factory in Mexico as the automaker reported a steep year-over-year decline in second-quarter profit on Tuesday.
Austin, Texas-based Tesla’s adjusted earnings per share fell 43% year over year to 52 cents in the second quarter, below Wall Street analysts’ estimates of 61 cents per share.
Tesla’s (NASDAQ: TSLA) second-quarter revenue rose 2% year over year to $25.5 billion, slightly beating analysts’ predictions of $24.8 billion.
“We saw large adoption acceleration of EVs, and then a bit of a hangover as others struggle to make compelling EVs,” Musk said during a call with analysts after the market closed. “There are quite a few competing electric vehicles that have entered the market. Mostly they have not done well, but they have discounted their EVs very substantially, which has made it a bit more difficult for Tesla.”
Musk, who announced plans for the $5 billion auto factory in Monterrey, Mexico, in March 2023, said the company will wait until after the November presidential election to decide whether to proceed.
“I think we need to see just where things stand after the election. Trump has said that there could be heavy tariffs on vehicles produced in Mexico. It doesn’t make sense to invest a lot in Mexico if that is going to be the case,” Musk said.
Republican presidential nominee Donald Trump has threatened to slap tariffs on vehicles imported from Mexico if he wins the election.
“We kind of need to see where things play out politically. However, we are increasing capacity at our existing factories quite significantly,” Musk said.
Tesla sold 443,956 vehicles during the second quarter, a 5% year-over-year decline.
Tesla officials did not provide an update on the status of its Semi, an all-electric Class 8 truck the automaker introduced in December 2022.
Tesla has only delivered about 36 of the 100 electric trucks it was supposed to deliver to PepsiCo., according to Reuters.
In Tesla’s second-quarter earnings report, the Semi is still listed as being in “pilot production.” The truck is scheduled for mass production at the company’s Nevada factory with deliveries to customers planned for 2026.
TeslaQ2/24Q2/23Y/Y % ChangeTotal revenue$25.5B$24.9B2%Automotive revenue$19.9.3B$21.3B(7%)Number of vehicles built410,831479,700(14%)Number of vehicles delivered443,956466,140(5%)Adjusted earnings per share$0.52$0.91(43%)Tesla second-quarter earnings snapshot.
The post Tesla Q2 profits plunge over 40% due to growing EV competition appeared first on FreightWaves.
