Tesla employees confirm demand problems but stock spikes on tariff reprieve
Tesla’s Model Y doesn’t seem to have stopped the company’s demand problem.
In an open letter asking Tesla CEO Elon Musk to resign, Tesla employees said that the company’s switchover to an updated Model Y in the first quarter isn’t the cause of its problems, Electrek reports.
That mantle goes to Musk, whose actions, they say, have stifled demand for the EV company’s vehicles, instead of, as CFO Vaibhav Taneja said on the latest earnings call, “not having enough new Model Y available in most markets for people to see and experience till the last few weeks of the quarter.”
Rather, the employees said there are “thousands of brand-new, updated Model Ys sitting on lots across the country.”
“Now those very cars are sitting unsold, growing week after week. Production is running better than ever. Quality is high. Processes are strong. Demand is what’s broken. This is not a product problem. It is a leadership problem.”
As Electrek previously reported, Tesla has already offered discounts and other incentives on what has historically been the company’s bestselling vehicle, suggesting weak demand.
This doesn’t appear to be adversely affecting the stock, which was trading up more than 6% this morning, likely due to news of the tariff reprieve between the US and China.
Of course, tariffs between the US and China don’t really affect Tesla’s business, since it makes its cars sold in China in China and finishes its cars sold in the US in the US. And the parts for US assembly are mostly affected by tariffs on Mexico and Canada.
But as Barron’s points out, the optimism likely has more to do with perception. China is a huge market for Tesla, and any anti-American sentiment could impact its business there (which appears to be declining at the start of Q2 as well).
