Tesla's Shares Falls Due to Cheaper Models

The US electric car maker ''Tesla'' reported results that topped Wall Street’s expectations for revenue growth in the final quarter of last year, but failed to hit forecasts for earnings, sending its shares lower in after hours trading, according to Financial Times report, on Wednesday.

Meanwhile, the shortfall followed a shift in sales towards Tesla’s lower-priced Model 3 and Y. The company also blamed “supply chain instability and pandemic inefficiencies. As well as, Tesla’s profit margins in the latest quarter were also held down by $267m in stock-based compensation paid to Elon Musk, tied to the giant pay package that was approved by shareholders three years ago.

On other hand, Musk told analysts that he believed the massive run-up in Tesla’s share price over the past year was justified by the company’s autonomous vehicle software and that, if anything both stock market investors and car buyers were underestimating the importance of the technology.

Also, he claimed that Tesla would perfect its self-driving software this year, and that it had had “preliminary discussions” about licensing the technology to other carmakers once it has been proven to work. The company has failed to hit deadlines in previous years when Mr Musk has made similar promises.