Musk Says He Doesn't 'Know What the Hell Is Going on' With Economy
The uncertain macroeconomic environment has stumped even Elon Musk.
Tesla has repeatedly slashed EV prices this year to keep up with the competition and rising interest rates.
Tesla reported an all-time high revenue of $24.93 billion on Wednesday, beating expectations.
Get the inside scoop on today’s biggest stories in business, from Wall Street to Silicon Valley — delivered daily. Loading Something is loading. Thanks for signing up! Access your favorite topics in a personalized feed while you're on the go. download the app Email address By clicking ‘Sign up’, you agree to receive marketing emails from Insider as well as other partner offers and accept our Terms of Service and Privacy Policy
To put it mildly, it's been a wild ride these past three years with the economy on a rollercoaster past the COVID-19 pandemic, inflation, rate hikes, recession fears, and now, hopes of a soft landing.
The situation has been so confusing that even Elon Musk — the boss of several visionary and futuristic tech companies — seems exasperated and had precisely the right combination of words to express how many feel.
"One day it seems like the world economy is falling apart, next day, it's fine. I don't know what the hell is going on," Musk, the CEO of car company Tesla, said during a second-quarter earnings call with analysts on Wednesday.
"We're in, I would call it, turbulent times," he added.
To underscore his point, Musk even sought out psychic assistance. "I don't have a crystal ball for the global economy. I'd really appreciate it, if I could borrow that crystal ball," he said. Tesla's investor relations department was more succinct, saying in its investor deck that the "challenges of these uncertain times are not over."
Tesla has already slashed prices for its electric vehicles, or EVs, repeatedly this year to not only keep up with the competition but also the economy.
"Buying a new car is a big decision for the vast majority of people, so any time there's economic uncertainty, people generally pause on new car buying at least to see what happens," he said.
It doesn't help that the US Federal Reserve has been in an interest rate hiking cycle since March 2022, making it more expensive to buy anything with debt — meaning that the price of any vehicle purchased on credit also goes up.
That's why Tesla slashed the prices of its EVs Musk explained: "We had to do something about that."
Depending on the macro-environment, Musk signaled the EV maker could cut prices again to boost sales.
"I think it makes it does make sense to sacrifice margins in favor of making more vehicles," he said during the call.
Tesla reported an all-time high revenue of $24.93 billion on Wednesday, beating the $24.47 billion analysts had forecast, per Refinitiv data. Earnings per share came in at 91 cents per share adjusted, beating the 82 cents per share analysts had expected.
Tesla's share prices fell 4.2% to $279.07 apiece in after-hours trade. They closed 0.7% lower on Wednesday and are up 136% this year.
Source: Business Insider
