Tesla's stock surged more than 12 per cent in after-hours trading on Wednesday, despite reporting earnings that missed analysts' estimates, as the company confirmed plans to begin producing cheaper models by mid-2025.
The company also announced it is testing a ride-hailing service in the Bay Area, San Francisco, expected to begin operations next year.
The Texas-based electric vehicle maker, which is struggling with weak sales and rising competition in the Chinese market, said the new models will be produced on the same factory lines as its current line-up.
This approach, according to Tesla, will allow the company to increase vehicle volumes in a more spending-efficient manner during uncertain times.
“This should help us fully utilise our current expected maximum capacity of close to three million vehicles, enabling more than 50 per cent growth over 2023 production before investing in new manufacturing lines,” the company said.
Tesla did not announce the names of the new models or the expected price range. It had announced its plan to introduce cheaper vehicles to attract more customers in April this year.
The company’s chief executive and co-founder Elon Musk said that his “best guess” is that vehicle growth will reach between 20 per cent and 30 per cent in 2025, boosted by “lower-cost vehicles” and the “advent of autonomy”.
He said the company has also developed an in-house ride-hailing app that some employees have been able to use in California this year.
“You can request [an autonomous] ride and it will take you anywhere in the Bay Area … we do have a safety driver for now,” Mr Musk said during the earnings call.
He said the company is expected to introduce the service to the public next year in California and Texas.
Tesla plans to reduce costs to make EVs cheaper
Tesla said the cost of goods sold per vehicle came down to its lowest ever at nearly $35,100, a figure derived by dividing its car sales revenue by the number of new vehicle deliveries in the quarter.
To continue accelerating the world’s transition to sustainable energy, Tesla said it needs to “make EVs affordable for everyone, including making total cost of ownership per mile competitive with all forms of transportation”.
“It's great to see Tesla getting down to business when it really matters,” Thomas Monteiro, senior analyst at Investing.com, told The National.
“The improving numbers across the board signal the company may have finally found a nice, sweet spot for the pricing versus production costs equation, which has been the main issue for stock performance since last year.”
Tesla's stock is one of the worst performers in the S&P 500 index, which has jumped nearly 22.3 per cent since the start of the year.
Its shares closed almost 2 per cent down at $213.65 on Wednesday, giving the company a market value of $669.47 billion.
But after the earnings announcement and disclosure of new plans, the stock jumped 12.1 per cent in after-market hours to trade at $239.50
The company's shares have dropped nearly 14 per cent since the start of the year. In April, the car maker announced plans to cut its workforce by more than 10 per cent.
Mr Musk said the move would help the company to become “lean, innovative and hungry for the next growth phase cycle”.
Tesla missing analysts’ expectations
Tesla reported a 17 per cent yearly jump in third-quarter net profit to nearly $2.2 billion. It was 46.6 per cent up on a quarterly basis.
Revenue during the July-September period increased 8 per cent to nearly $25.2 billion, missing analysts’ expectations of $25.3 billion. It was the ninth straight quarter the company reported $20 billion or more in sales.
Earnings per share grew 17 per cent to 62 cents exceeding expectations of 42 cents based on a survey of analysts by LSEG.
Tesla's profit margins were driven by $739 million in automotive regulatory credits revenue during the quarter.
Automotive regulatory credits are government-issued incentives that Tesla earns by exceeding emissions standards, which it can sell to other car makers that fall short of meeting the regulatory standards. This allows those companies to avoid fines for non-compliance.
“The market got the message it needed to hear … Tesla's margins are improving right when they needed to – that is, ahead of a better interest environment globally. This means the company may have more firepower to get the innovation it desperately needs both on the production and product sides faster and better than the competition,” Mr Monteiro said.
The company’s automotive revenue surged 2 per cent to $20 billion, while energy generation and storage revenue expanded 52 per cent to nearly $2.4 billion in the last quarter.
Tesla said its operating income increased by 54 per cent yearly to more than $2.7 billion in the last quarter, while operating expenses decreased 6 per cent to nearly $2.3 billion.
Earlier this month, at the company's long-anticipated robotaxi event, Mr Musk displayed the new Cybercab autonomous concept vehicle. He said production will start in 2026 and the vehicles will be available for customers to buy for less than $30,000. They will cost 20 cents a mile to operate, he said.
In a shareholder letter on Wednesday, Tesla announced that as of October 22, it had produced 7 million vehicles. The company said its newest model, the cybertruck, became the third best-selling EV in the US, trailing only the Model 3 and Model Y.
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
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Available: Now
UAE currency: the story behind the money in your pockets
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
COMPANY PROFILE
● Company: Bidzi
● Started: 2024
● Founders: Akshay Dosaj and Asif Rashid
● Based: Dubai, UAE
● Industry: M&A
● Funding size: Bootstrapped
● No of employees: Nine
The biog
Born: Kuwait in 1986
Family: She is the youngest of seven siblings
Time in the UAE: 10 years
Hobbies: audiobooks and fitness: she works out every day, enjoying kickboxing and basketball
A State of Passion
Directors: Carol Mansour and Muna Khalidi
Stars: Dr Ghassan Abu-Sittah
Rating: 4/5
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The nine articles of the 50-Year Charter
1. Dubai silk road
2. A geo-economic map for Dubai
3. First virtual commercial city
4. A central education file for every citizen
5. A doctor to every citizen
6. Free economic and creative zones in universities
7. Self-sufficiency in Dubai homes
8. Co-operative companies in various sectors
9: Annual growth in philanthropy
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Washmen Profile
Date Started: May 2015
Founders: Rami Shaar and Jad Halaoui
Based: Dubai, UAE
Sector: Laundry
Employees: 170
Funding: about $8m
Funders: Addventure, B&Y Partners, Clara Ventures, Cedar Mundi Partners, Henkel Ventures
ESSENTIALS
The flights
Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.
The hotels
Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.
The tours
A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages.
Gulf Under 19s final
Dubai College A 50-12 Dubai College B
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
Tips to stay safe during hot weather
- Stay hydrated: Drink plenty of fluids, especially water. Avoid alcohol and caffeine, which can increase dehydration.
- Seek cool environments: Use air conditioning, fans, or visit community spaces with climate control.
- Limit outdoor activities: Avoid strenuous activity during peak heat. If outside, seek shade and wear a wide-brimmed hat.
- Dress appropriately: Wear lightweight, loose and light-coloured clothing to facilitate heat loss.
- Check on vulnerable people: Regularly check in on elderly neighbours, young children and those with health conditions.
- Home adaptations: Use blinds or curtains to block sunlight, avoid using ovens or stoves, and ventilate living spaces during cooler hours.
- Recognise heat illness: Learn the signs of heat exhaustion and heat stroke (dizziness, confusion, rapid pulse, nausea), and seek medical attention if symptoms occur.
UAE currency: the story behind the money in your pockets
Conflict, drought, famine
Estimates of the number of deaths caused by the famine range from 400,000 to 1 million, according to a document prepared for the UK House of Lords in 2024.
It has been claimed that the policies of the Ethiopian government, which took control after deposing Emperor Haile Selassie in a military-led revolution in 1974, contributed to the scale of the famine.
Dr Miriam Bradley, senior lecturer in humanitarian studies at the University of Manchester, has argued that, by the early 1980s, “several government policies combined to cause, rather than prevent, a famine which lasted from 1983 to 1985. Mengistu’s government imposed Stalinist-model agricultural policies involving forced collectivisation and villagisation [relocation of communities into planned villages].
The West became aware of the catastrophe through a series of BBC News reports by journalist Michael Buerk in October 1984 describing a “biblical famine” and containing graphic images of thousands of people, including children, facing starvation.
Band Aid
Bob Geldof, singer with the Irish rock group The Boomtown Rats, formed Band Aid in response to the horrific images shown in the news broadcasts.
With Midge Ure of the band Ultravox, he wrote the hit charity single Do They Know it’s Christmas in December 1984, featuring a string of high-profile musicians.
Following the single’s success, the idea to stage a rock concert evolved.
Live Aid was a series of simultaneous concerts that took place at Wembley Stadium in London, John F Kennedy Stadium in Philadelphia, the US, and at various other venues across the world.
The combined event was broadcast to an estimated worldwide audience of 1.5 billion.
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
UAE currency: the story behind the money in your pockets
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