Tesla's robotaxi ambitions, used EVs skyrocket, new financial woes for Fisker

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—CDG

1. Big updates from Tesla during Q1 earnings report

At a glance: Tesla’s earnings were pretty much in line with analysts' expectations in Q1, falling just shy of forecasts. Revenue dropped 9%, likely due to ongoing price cuts from the EV maker. Net income fell to $1.13 billion, 55% less than a year earlier. 

Diggin in: The most interesting announcements from the automaker concern its upcoming robotaxi launch and promise of an affordable Model 2 for $25,000. 

For years, Musk has been hinting at a self-driving Tesla taxi service.

He even floated the idea of Tesla owners making money by allowing their cars to operate autonomously as taxis, picking up and dropping off passengers.

On April 5, CEO Elon Musk tweeted on X that the robotaxi, the “cybercab” is slated to make its debut on Aug 8. 

The company also teased some features from its forthcoming ridehailing mobile app. 

The robotaxis will be guided by Tesla’s Full Self-Driving (FSD) software. The software allows Teslas to navigate city streets, stop at lights, and handle turns with minimal human intervention, but Tesla itself acknowledges that the system isn't fully autonomous. 

The path is less clear for Tesla’s “more affordable” vehicles. 

Earlier this month, Reuters reported that Tesla was scrapping its plans for a $25,000 Model 2 in favor of going all in on robotaxis. But now the EV maker says that cheaper cars are coming as early as 2025. 

During the earnings call, Tesla executives said they are rethinking the entire assembly when it comes to introducing less expensive cars. The new models will be built on Tesla's existing production lines and use parts of its current and next-generation platforms. Tesla cautioned that this plan may "result in achieving less cost reduction than previously expected."

When pressed about the Model 2, Musk said, “The way to think of Tesla is almost entirely as solving autonomy, and being able to turn on that autonomy for a giant fleet.” 

More notable events in April:

• April 23: Tesla officially reveals a new version of the Model 3 (starting at $52,990).
  

• April 21: The price for FSD software drops to $8,000 from $12,000.
  

• April 19: Tesla cuts prices of Models Y, S, and X in the U.S. by $2,000.
  

• April 15: The EV maker layoffs 10% of its global workforce.
  

• April 2: Tesla's deliveries declined by 8.5% to 386,810 vehicles from a year ago. Wall Street expected Tesla to deliver 454,200.

Tesla shares rose 11% after Tuesday’s closing bell, but they are down more than 40% so far this year.

2. Used EVs are on fire

Topline: According to data from Cox Automotive, used EV sales rapidly grew by 32% year-over-year in the first quarter, largely due to declines in prices. 

At a glance: With an uptick in new EVs coming to market, it makes sense that used EVs have greater market penetration. After all, every new EV eventually becomes a used one.

Through Q1, Manheim wholesale locations across the U.S. processed nearly 9,800 used EVs, an increase of 40% from the same period in 2022.

Simply having more EVs in the market is driving these gains and increased product availability will likely attract more buyers.

What’s more: The average retail listing price for a used EV was around $43,400, a 4% decrease from Q1 2022. 

How is this translating to consumer behavior? 

According to the Spring 2024 CarMax Electric Vehicle Consumer Report, the percentage of monthly used EV searches on CarMax.com has increased by 177% since January 2021.

The Tesla Model 3, Tesla Model Y, and Nissan LEAF continue to be CarMax's most popular used EVs, mirroring last year’s preferences. However, prices for these models have now sharply fallen, ranging between $3,000 and $5,000 less.

The average price for the top 10 most popular used EVs at CarMax fell between $22,000 and $46,000. Last year, these same vehicles ranged from $22,000 to a much higher price of $72,000.

The primary reason? The Tesla Model X, which made the list of most popular used EVs last year, did not this time around. Its high price tag usually drives the average price up. 

Trade-ins: Most car buyers trade in SUVs (39%) and sedans (31%) for used EVs. Toyota remains the most popular brand traded in for a used EV, followed by Ford and Honda.

Interestingly, BMW (previously number 2) has dropped significantly, and Tesla itself isn't on the list of traded-in brands anymore. Hyundai, on the other hand, is a newcomer in the top traded-in brands for EVs.

Geography: California has been the leader in used EV sales at CarMax and this continues to be true. While the Western states have a stronghold on used EV interest, East Coast states like Massachusetts, New York, and Maryland cracked the top 10 list for top used EV sales. 

Key quote: “Our data analysis confirmed that consumers are still very interested in EVs and that sales were increasingly trending beyond the west coast," said Jim Lyski, EVP, Chief Innovation and Strategy Officer at CarMax. “The availability of new models coupled with recent price cuts on new EVs may have contributed to ongoing interest from consumers considering making the switch from gas to electric."

3. Fisker’s battery is running low

Top line: EV startup Fisker is on the brink of bankruptcy once more, according to a recent SEC filing.

With only $54 million in accessible cash as of mid-April, and an inability to tap into an additional $11.2 million, the company's liquidity crisis has forced major reductions in its workforce. Fisker’s global staff total is now 1,135 employees, down from 1,500 in 2022, reports TechCruch. 

High-stakes: Fisker expects to file bankruptcy within the next 30 days if it can’t raise the funds to pay off its creditors. The EV maker also said it missed an $8.4 million interest payment in March, which led to defaulting on a sizable loan. As of January, the outstanding balance for the loan was $324.5 million.

Later on in March, Fisker slashed the prices of its 2023 Ocean models. The 2023 Sport is now priced at $24,999, down from $38,999. Fisker also lowered the 2023 Ocean Extreme trim by $24,000 and now starts at $37,499.

What’s more: On March 18, Fisker decided to go on a production hiatus while it prioritizes restructuring. Just yesterday, Fisker announced that Michael Healy will be stepping in as “chief restructuring officer.”

Why it matters: Fisker's potential bankruptcy could cause some investors to become more cautious about the entire EV market.

• Vinfast signs on 12 more dealerships in the U.S.
  

• Mercedes-Benz unveils electric G-Wagon.
  

• Stellantis lays off 199 workers at its Sterling Heights Assembly Plant.
  

• The IEA’s annual Global EV Outlook predicts global EV sales will reach 17 million.
  

• Ally Financial saw a record 3.8 million auto loan applications from consumers during Q1.

We’ve got tons of great jobs hitting the CDG Job Board right now. Here are some standouts for anyone looking for their next move.

• Time for something different? OpenLane is hiring a ton of market sales managers all over the country.

• Remote work more your speed? CarNow is hiring for several roles like BDC operations manager and account manager.

• Enjoy face time with car buyers? CarEdge is looking for a car buying concierge.

Looking to hire? Add your roles today—it’s 100% free.

Thanks for reading today’s edition of the daily roundup. Before you go, let us know if these stories and insights were valuable to you.

— CDG