Elon Musk expects a recession

Photo: Theo Wargo – Getty Images

  • The CEO of Tesla shared his views this week at the Qatar Economic Forum when asked about the chances of an economic downturn in the US.

  • The carmaker is in the process of hiring workers for two new plants, as it seeks to increase production in the coming months, although it is raising prices on both versions of all four models.

  • The Twitter purchase deal is still in the works, although Tesla CEO raises public questions about the social network bot’s share.

Tesla CEO Elon Musk has been predicting a sea of ​​turmoil for the economy in recent months, starting with his messages about raw material prices for the automotive industry. The CEO said a year ago that raw material prices were an incentive for price increases for Tesla models and repeated the same earlier this spring, as several other automakers had begun to face much higher prices for metals and other materials. used in EV production.

The CEO of Tesla reiterated his views this week at the Qatar Economic Forum when asked about the possibility of an economic downturn in the US.

“Well, I think a recession is inevitable at some point. As for whether there will be a recession in the near future, I think it is more likely than not,” Musk said. “It certainly is not certain,” he added, slightly offsetting his statement.

The Tesla chief had cited a worsening economic outlook amid the carmaker’s recently announced target of cutting 10 percent of its workforce, while increasing the number of hourly workers, just weeks after the German carmaker and in Austin, Texas. . The decision to cut staff just as production was slowly starting at two new plants has certainly raised eyebrows in the automotive industry during a financial quarter that could come as a surprise, largely due to weeks of downtime. in Giga Shanghai due to the coronavirus measures implemented. by the Chinese authorities.

However, the CEO of Tesla and SpaceX is still completing the Twitter market, a process that may have become more complicated and costly than expected.

The Tesla stock had lost much of its value in the weeks following the first announcement of the deal, as Musk was asked about the number of possible bot accounts on the social network. Musk is still widely expected to complete the deal, although he is asking more questions about the site in an unusual corporate move.

The deal with Twitter now appears to have hatched in another economic climate, with no impending recession. As many observers have pointed out, he was probably under scrutiny by Musk for months, if not years, but is now in a difficult economic situation.

In another sign of belief in a worsening economic climate, Tesla recently raised prices across the range, in another major round of price increases since March this year.

The recent move, which went unannounced last week, has been widely interpreted as bridging the gap with the rise in raw material costs that Musk had warned of months earlier. The Model X received the toughest increase of $ 6000, while the Dual Motor AWD Long Range version of the Model S received a price increase of $ 5000. The original Model S had been sitting above the $ 100,000 mark for some time, tens of thousands of dollars north of where it was just a few years ago.

Tesla’s two less expensive models, the Model 3 and Model Y, received slightly smaller price increases in proportion to their prices.

Photo: Hearst Owned

Photo: Hearst Owned

Leave a Reply

Your email address will not be published.