Here's the No. 1 Question Retail Investors Want Tesla to Answer Ahead of Earnings

Amid hundreds of questions for Tesla earnings day, one reigns supreme

A Model 3 at an exposition in Beijing in December. Starting at nearly $40,000, the EV is not exactly geared to the masses. But retail investors are keen to know more about the less expensive Model 2.

Tesla Inc.’s investors have a lot on their minds right now: Questions swirl about the company’s official outlook for the year, the demand picture amid a slowdown in electric-vehicle sales, and the EV maker’s profit margins amid recent price cuts.

But first and foremost, retail investors seem to want to know about Tesla’s next vehicle, dubbed the “Model 2,” which is expected to cost around $25,000 — the hoped-for next driver of growth at Tesla.

That was the No. 1 question on Tesla’s investor-relations website Wednesday, with more than 2,000 upvotes.

Tesla and a few other companies, notably Robinhood Markets Inc., offer retail investors a chance to ask management questions to be answered during the company’s earnings call following results.

The Tesla platform currently has hundreds of questions from stockholders, representing more than 11 million shares, according to the company.

At Tesla, executives go over a few of the top questions before the investment-bank analysts have a turn, which means that often a Tesla call will last longer than the average post-results call, and usually at least one hour long.

On Tuesday, the top-voted question read: “Given that you moved the start of the next generation compact vehicle production to Austin, has the timeline improved so that we might see next generation platform vehicles in 2025?”

The Model 3 was hailed as the first mass-market Tesla, but the pricing doesn’t really fit the bill: A rear-wheel base model starts at $38,900, and a long-range, all-wheel-drive model at $45,990.

That souped-up version hovers around the average price for a new U.S. vehicle these days, at $48,000. A $35,000 version of the Model 3 never materialized.

A $35,000 version of the Model 3 never materialized.

Investors first got official word of a next-generation vehicle in March as Tesla and Chief Executive Elon Musk held an investor day to tout its “Master Plan 3.”

The plan was short on the details about the car, and at the end of a four-hour presentation, Musk sidestepped a question that sought details about the new vehicles’ performance and looks, the prototype timeline, and whether Tesla would start making them at an existing factory before moving production to its future Mexico factory, as it intends to do.

Instead, Tesla executives said that the company had to “fully rethink” the way it makes EVs so the next-generation vehicles would be made faster and cheaper, and with a smaller powertrain and lighter weight.

They also said that the more affordable next-generation EV platform promised could be the base for more than one vehicle.

Tesla is scheduled to report fourth-quarter results after the bell Wednesday with a call, which is webcast, slated for 5:30 p.m. Eastern.

Analysts polled by FactSet expect Tesla to report adjusted earnings of 73 cents a share on sales of $25.6 billion. That would compare with adjusted earnings per share of $1.19 on sales of $24.3 billion in the fourth quarter of 2022.

The stock has been off to a rough start of the year, down 16% so far this month. In the past 12 months, however, the shares have gained 45%. These performances compare with gains of about 2% and of around 21% for the S&P 500 index in January and in the last 12 months.

This year, Tesla cut prices in China and disclosed plans to temporarily halt production in Germany due to the Red Sea conflict and supply-chain disruptions.