Elon Musk: Tesla Can Lower Prices 'if Inflation Calms Down'

Dow Jones2022-07-15

By Will Feuer

Tesla Inc. can lower prices for its cars "if inflation calms down," Chief Executive Elon Musk said.

Mr. Musk's comments, made Friday in a tweet, come a month after Tesla last raised prices on some of its cars by as much as $6,000. Before that, Tesla raised prices in March, soon after Mr. Musk warned in a tweet that Tesla and his Space Exploration Technologies Corp., or SpaceX, "are seeing significant recent inflation pressure in raw materials & logistics."

Mr. Musk in April said that prices take into account monthslong wait lists for Tesla cars as well as expectations that costs will continue to rise.

"It may seem like maybe we're being unreasonable about increasing the prices of our vehicles given that we had record profitability this quarter," Mr. Musk said on the company's quarterly earnings call. "Our prices of vehicles ordered now are really anticipating supplier and logistics cost growth that we're aware of and believe will happen over the next six to 12 months."

Mr. Musk at the time said that if the company's expected cost increases didn't materialize, Tesla may slightly reduce prices.

Between 10% and 15% of Tesla's cost structure is exposed to swings in raw-materials prices, finance chief Zachary Kirkhorn said in April.

Write to Will Feuer at Will.Feuer@wsj.com

$(END)$ Dow Jones Newswires

July 15, 2022 09:37 ET (13:37 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.

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