Tesla CEO Elon Musk has revealed the electric vehicle maker’s multi-faceted strategy centered around cost efficiency, technological innovation, and product expansion.
Tesla’s production has reached approximately 459,000 electric vehicles. Tesla’s EV delivery has touched over 495,000 vehicles in the fourth quarter of 2024. Tesla has deployed 11.0 GWh of energy storage products.
In 2024, Tesla has produced 1,773,443 EVs and delivered 1,789,226 EVs. Energy storage deployments for 2024 were 31.4 GWh.
In 2024, the company invested heavily in manufacturing, artificial intelligence, and robotics, with AI-related capital expenditures reaching approximately $5 billion. Looking ahead to 2025, Tesla expects its capital expenditures to remain steady year over year, reinforcing its commitment to scaling operations while optimizing costs.
A key focus for Tesla is the introduction of new, more affordable electric vehicle models, slated for release in the first half of 2025. This move aligns with the company’s broader goal of making EVs accessible to a wider audience. Additionally, Tesla is preparing to launch a paid autonomous car service in June, aiming to commercialize its advancements in self-driving technology. The Full Self-Driving (FSD) software will undergo further testing in various states, including California, marking another step toward achieving fully autonomous driving.
On the cost front, Tesla has been working to lower the expenses associated with vehicle production. The company reported that the average cost of materials and labor per vehicle reached its lowest level ever in the fourth quarter of 2024, thanks to declining raw material prices.
Reuters estimates indicate that Tesla’s production cost per car has dropped to approximately $33,000 from nearly $39,000 two years earlier. This efficiency-driven approach is crucial as Tesla faces increasing competition from global automakers, including China’s BYD and European giants such as BMW and Volkswagen, which have introduced more affordable EV models to capture market share.
Tesla’s financial performance in the last quarter of 2024 reflected both challenges and resilience. The company generated $25.71 billion in revenue during the October-December period. However, for the first time, Tesla experienced an annual decline in deliveries due to rising borrowing costs and intensified competition. Despite this, Tesla expects its vehicle business to return to growth in 2025, following a slight dip in 2024. While Elon Musk previously projected a 20 percent to 30 percent increase in sales for 2025, the company did not reiterate this outlook in its latest results.
Tesla’s strategic direction remains focused on sustaining its leadership in the EV sector through cost reductions, AI-driven advancements, and expansion into new market segments. With autonomous driving and affordability as key priorities, the company aims to maintain its competitive edge while navigating the shifting dynamics of the global EV industry.
Baburajan Kizhakedath