Tesla CEO Musk: the price reduction has greatly stimulated demand, 2023 sales may reach 2 million vehicles

Beijing, January 26 (Xinhua) Tesla CEO Elon Musk (Elon Musk) said on Wednesday that the company's aggressive price cuts triggered a wave of demand for its electric cars. The statement eased concerns that a weak economy would dampen interest among buyers.

Despite a sharp drop in profit margins in the auto business, Tesla reported fourth-quarter revenue and profit that beat Wall Street expectations earlier on Wednesday. The company is trying to reassure investors that it can cut costs and continue to generate cash as competition intensifies in the coming year.

This month's sharp price cuts have made Tesla the initiator of a price war, but the company expects car sales to grow by 37 per cent to 1.8 million this year, down from 2022. At a time when the global economy is weak, Tesla's sales prospects have become the focus of investors. The company's long-term goal is to achieve a compound annual sales growth rate of 50%.

Musk talked about the issue at the beginning of a conference call with investors and analysts. "these price adjustments do have an impact on ordinary consumers," he said. Demand in January was about twice as much as output, he added. Without external interference, Tesla's sales could reach 2 million in 2023. In 2022, Tesla delivered 1.31 million vehicles.

Musk: the price cut has greatly boosted demand for 2023 sales or up to 2 million vehicles Tesla acknowledged concerns about economic uncertainty and said he would "accelerate our cost-cutting roadmap and boost higher productivity" in the short term.

Tesla CFO Zack Kirkhorn (Zach Kirkhorn) said that the price cut will undermine profitability, but as the company reduces costs, profit margins should increase.

Tesla shares were up 0.38 per cent as of Wednesday's close. Tesla's shares rose 4.3 per cent in after-hours trading after the announcement.