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Tesla has said it will build cheaper cars and win approval for its self-driving software in Europe this year, as it tries to revive its struggling business.<\/p>\n
Elon Musk’s electric car firm told investors it had started “first builds of a more affordable model in June” while posting a slump in car deliveries and shrinking profits.<\/p>\n
The firm is struggling as it faces cuts to US government support for electric cars, competition from Chinese carmakers, and a brand hit from Musk’s controversial political activities.<\/a><\/p>\n Meanwhile, Tesla told investors US tariff policy<\/a> had cost it $300m over the three months to June and warned of further pain in the months ahead.<\/p>\n<\/div>\n Chief financial officer Vaibhav Taneja said the end of a tax credit for buyers of electric cars in the US is also likely to hurt.<\/p>\n Tesla did not provide an update on its outlook for the year, warning it was “difficult to measure the impacts of shifting global trade and fiscal policies”.<\/p>\n Revenue in the three months to June fell 12% year-on-year – the biggest drop in at least a decade – after deliveries plunged 14%.<\/a> Profits fell 16%.<\/p>\n Musk told investors on Wednesday he expected the firm’s sales in Europe to increase once customers there are allowed to use the firm’s self-driving software. <\/p>\n He said he expected the first approval to come in the Netherlands but that the firm also hoped to win sign-off from the European Union, despite it having a “kalfka-esque” bureaucracy.<\/p>\n “Autonomy is the story,” Musk said. “Autonomy is what amplifies the value [of the company] to stratospheric levels.”<\/p>\n But the firm’s once-fat margins have shrunk sharply, with profits down in <\/b>five of the last six quarters. <\/p>\n Shares have fallen roughly 30% from the peak last year, after Musk’s support for Trump helped win the White House. <\/p>\n<\/div>\n In May, as concerns about the company mounted, the head of the company’s board had to publicly deny it had started looking for a replacement<\/a>. <\/p>\n Investors cheered after Musk said he was leaving the Trump administration, hoping he would focus on the company and steer clear of politics. <\/p>\n