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The EV market shakeout continues as longtime segment leader Tesla navigates its most challenging period in years and legacy automakers churn out profits from ICE vehicles.
Tesla’s recent woes were in focus in the EV maker’s Q1 earnings report. Tesla reported $1.1 billion in net income, down 55% YoY, on revenue of $21.3 billion. The company’s Q1 profits hit their lowest point since 2021, the Wall Street Journal reported. Tesla’s stock is down more than 30% year to date.
In a quarterly update, Tesla acknowledged that it “experienced numerous challenges in Q1,” including Red Sea trade disruptions and ramping up production of the updated Model 3.
“Global EV sales continue to be under pressure as many carmakers prioritize hybrids over EVs,” Tesla said in the report.
Still, some analysts were pleased to hear CEO Elon Musk’s assurances that Tesla is forging ahead with plans for a more affordable EV rather than focusing solely on robotaxis.
Meanwhile, Ford and GM reported profits on the strengths of their ICE vehicle businesses, even as they continue to lose money on EVs.
GM reported $3 billion in net income (up 24% YoY) on $43 billion in revenue. CEO Mary Barra said in a letter that the automaker boosted retail EV deliveries by 21% YoY in Q1, and is seeing “sequential and year-over-year improvements in profitability” in its EV business thanks to “scale, material cost, and mix improvements.”
She noted that battery cell costs have fallen as production has ramped up at GM’s joint-venture battery plant in Ohio. The automaker expects to double its battery module production capacity by summer’s end.
Ford posted $1.3 billion in net income on $42.8 billion in revenue. Its commercial vehicle and ICE vehicle businesses delivered profits, while its EV business posted an EBIT loss of $1.3 billion.
In a press release, Ford reported that EV revenues were down YoY “as wholesales declined and significant industrywide pricing pressure continued to affect electric vehicles currently on the market,” adding that it “expects EV costs to improve going forward, but be offset by top-line pressure.”
But the April EV market wasn’t stagnant, according to sales reports.
Hyundai Motor America’s April EV and hybrid sales grew 31% and 29% YoY, respectively. And sister brand Kia had its “all-time best EV sales” in April, increasing 144% YoY on the strength of models like the EV9. Ford’s April EV sales more than doubled, while hybrid sales climbed nearly 60%.