Tesla CEO Elon Musk voices concern about interest rates after revenue miss, hesitancy on Mexico plant
- After Tesla missed Wall Street expectations last quarter, Musk pointed to macroeconomic conditions, but previously said the firm was ‘recession resilient’
- The EV maker’s aggressive price cuts this year have battered its gross margin, particularly in China where it faces stiff competition
Tesla CEO Elon Musk said on Wednesday that he was concerned about the impact of high interest rates on car buyers, adding the electric vehicle maker was hesitating on its plans for a factory in Mexico as it gauges the economic outlook.
After the company missed Wall Street expectations on third-quarter gross margin, profit and revenue, Musk said he was cautious about going “full tilt” on the Mexico factory.
“If the macroeconomic conditions are stormy, even the best ship is still going to have tough times,” he said in a shift in tone from a year ago, when he said Tesla was “recession resilient”.
Shares in the company fell more than 4 per cent in after-hours trading on Wednesday. They had closed down 4.8 per cent.
Tesla has managed to maintain demand with a series of price cuts, but Musk spent much of the call voicing concerns about further expansion, saying that he was afraid rising interest rates would make cars unaffordable.