Elon Musk's Tesla Suffered 'Catastrophic' Sales Drop, Loses $30 Billion in Market Value
For the first time in 4 years, Tesla reported in its financial report for the first quarter that it had suffered a "catastrophic" drop in sales: during this time, 386,810 cars were delivered, 20% less than the 484,507 electric cars shipped in the previous quarter. This was reported by the Independent.
It is also noted that Tesla lost $30 billion in market value due to lower quarterly deliveries. Overall, Tesla shares have fallen by about 33% this year.
Tesla could "go bankrupt," while its shares could fall as low as $14, Per Lekander, a hedge fund manager who has been shorting electric carmaker Elon Musk since 2020, told CNBC on Wednesday.
"This was really the beginning of the end of the Tesla bubble, which was probably the biggest stock market bubble in modern history," said Lekander, managing partner of investment management firm Clean Energy Transition.
"In fact, I think the company may go bankrupt."
If Tesla shares reach $14, it would represent a 91% drop from Tuesday's close. This year, Tesla shares have already fallen by more than 30%.
Lekander gave a number of reasons for his negative view. He said that Tesla's business model is based on strong revenue growth, vertical integration, and direct-to-consumer sales. Vertical integration in the broadest sense means that one company handles many parts of the process internally, from car manufacturing to software. This model is "brilliant" when the company is growing, but it goes "backwards" when sales fall, Lekander said.
Tesla was not available for comment to CNBC.