Tesla (TSLA) is set to report its fourth-quarter and full-year earnings on Wednesday, as familiar — if enhanced — concerns linger in investors’ minds.
When CEO Elon Musk addressed investors in October, he promised to grow sales by 30% next year. Wall Street, however, estimates only a 16% increase. The Austin, Texas-based automaker missed its own goals for electric vehicle sales last year, falling short of 1.8 million units sold.
Earlier this month, Tesla unveiled a refreshed Model Y, which it hopes will boost sales. It’s the first major update for the aging SUV, which was the most popular car in 2023 and was launched five years ago.
Investors are hoping that Tesla will release a new, cheaper model this year, which analysts say would be a major boost to the company’s core automotive business. Barclays (BCS) analyst Dan Levy recently called a low-cost model “crucial” to Tesla’s growth plans.
Tesla’s head of investor relations reportedly told Deutsche Bank (DB) last month that a sub-$30,000 Tesla nicknamed the “Model Q” would boost sales by 20% to 30%, although profits would take a hit. However, that price includes the benefits of the $7,500 tax credit for consumer EV purchases, which President Donald Trump is expected to cancel.
Investors are also worried about Musk’s commitment to Tesla, which has long been a concern as his empire and interests have grown. He’s the CEO of SpaceX, owner of social media network X, and founder of Neuralink, xAI, and The Boring Co, and a super political action committee.
Musk will likely become a special government employee to lead his DOGE task force as he continues to advise Trump. He also has at least a dozen children and a video game career. In June, while urging investors to re-approve Musk’s $56 billion compensation deal, Tesla Chair Robyn Denholm said that Musk doesn’t face “any shortage of ideas and other places he can make an incredible difference.”
“How will Tesla manage having a part-time CEO, with Elon being busy with DOGE, SpaceX, X and others?” asked a Tesla investor representing over 392,000 shares on Tesla’s investor relations website. “Is a strong COO ala Gwynn Shotwell being considered?”
Two other investors, representing almost 120,000 shares and 288,000 shares, respectively, asked how Musk’s relationship with the White House will affect Tesla. The president has begun his anti-EV agenda, halting funding for the Inflation Reduction Act — which has allocated $82.5 billion to 164 EV-related projects.
Musk has said Tesla will benefit from the end of EV tax credits, although analysts have been skeptical. Trump’s advisers have also considered streamlining federal rules for autonomous vehicles, which would favor Tesla’s robotaxi plans.
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