Speaker 1: Let's take a look at some of the stocks on
Speaker 1: the movie alsoing alongside normal Lindon, we've been talking a
Speaker 1: lot about Tesla delivery numbers came in weaker than expected.
Speaker 1: Let's get the broad overview of what's happening that our
Speaker 1: good friends at Tesla stocks down about twenty four percent.
Speaker 1: You Todd return to Pierre Farragu, head of Global Technology
Speaker 1: Infrastructure at New Street Research. Pierre, thanks so much for
Speaker 1: joining us here. How do you think about these Tesla numbers?
Speaker 1: What does it mean for the near and intermediate term
Speaker 1: story at Tesla.
Speaker 2: Yes, as you said, that is a bit of a
Speaker 2: positive surprise, like people tracking very precisely deliveries in various
Speaker 2: markets by expecting slightly lower numbers. The surprise comes from
Speaker 2: the US. The US did is a place where it's
Speaker 2: the most difficult to track the number of Tesla being delivered,
Speaker 2: and the US bit beat expectations. So that's another why
Speaker 2: coming in doing actually quite well. That's good. But then
Speaker 2: at the end of the day you have to remember,
Speaker 2: as the big picture, we are down thirteen percent here
Speaker 2: on air, so we are facing a situation where Tesla
Speaker 2: is struggling to sell cars a gross margin is in
Speaker 2: the latins. To me, Tesla facing good demons should be
Speaker 2: able to defend like mid mid twenties gross margin. So
Speaker 2: we have like we are facing like a core business
Speaker 2: and not a business that is really at a very
Speaker 2: low point that is struggling. And so that's the difficulty.
Speaker 2: You have, like one structural difficulty that is relatively that
Speaker 2: we understand relatively well. It's that with their current product,
Speaker 2: Tesla has kind of saturated its opportunity. Tesla needs lower
Speaker 2: high points to keep growing, and that's in the plan
Speaker 2: they're working on it. And then you have a number
Speaker 2: of other issues. You know, electric cars are less fashionable
Speaker 2: than they were a couple of years ago. The Tesla
Speaker 2: brand has suffered, particularly in Europe where numbers are done
Speaker 2: like almost forty percent year on air, and so it
Speaker 2: is definitely it's difficult to quantify, but it is a
Speaker 2: significant headway as well. And overall, you know, the economy
Speaker 2: is not right the best you can imagine for.
Speaker 3: Yeah, I mean when we look at the mag seven stocks,
Speaker 3: we see Tesla as the primary laggard this year, down
Speaker 3: about twenty three percent. And of course we know that
Speaker 3: investors have really been vying for Musk's attention as he's
Speaker 3: been really politically involved. So as we're seeing these numbers
Speaker 3: come through, what do things like moving forward? Are these
Speaker 3: numbers a massive impact or are the Tesla loyalists still
Speaker 3: out there and is there some further positivity to come.
Speaker 2: The Tesla stock has been on a royal cost. It's
Speaker 2: like a very low performance this year, but it was
Speaker 2: like a clear out performer last last year. And as
Speaker 2: you say, you know, it's following, it's following, you know,
Speaker 2: the political carrier, if I may say, of the CEO
Speaker 2: in a musk and like this has created this situation.
Speaker 2: Now if you look at the stock, you know, since
Speaker 2: you know, like April first, what you see is that
Speaker 2: what tends to really move the stock is actually the
Speaker 2: news flow around how the company is now focused on
Speaker 2: deploying fleets of robotaxes. They've just started that in a
Speaker 2: couple of weeks ago, like late late last months, and
Speaker 2: I think that's going to be the primary driver of
Speaker 2: the stock going forward. Of course, there is a lot
Speaker 2: of uncertainty on you know, how fast Testa is going
Speaker 2: to be able to deploy robotaxy or even make a
Speaker 2: profits like generate the profits out of the robot taxi fleet.
Speaker 2: But the size of the price is so gigantic and
Speaker 2: so much more than the hotel business that this is
Speaker 2: probably why drives the stock going forward.
Speaker 1: Pierre, thank you so much for joining us. Always appreciate
Speaker 1: getting your thoughts there. Pierre fairgul He's set of Global
Speaker 1: Technology Infrastructure at New Street Research.