Elon Musk Offers Good Inflation News

Elon Musk Offers Good Inflation News ...

Any information suggesting that prices might decline is fantastic in these uncertain times, when whispers of recession are becoming more louder every day, particularly for consumers and authorities for whom inflation has become a source of worry.

After all, high inflation might cost elected officials at the ballot box.

From groceries to smartphones, PCs to toothpaste, and soap to shower gel, inflation is roiling across the world.

Air ticket prices have risen. Gas prices at the pump remain high, although we are far from the highs experienced a few weeks ago.

Elon Musk, Tesla's CEO (TSLA) - Get Tesla Inc. Reporthas just made observations that will please most people: consumers, Tesla customers, investors, and politicians.

Tesla's Relief

Musk claimed that the costs of the raw materials needed to produce Tesla's cars are decreasing in a series of tweets posted on July 28. The prices of commodities (nickel, cobalt, palladium, lithium, etc.) have increased dramatically since Russia's invasion of Ukraine on February 24. This has increased the amount of chips missing due to the covid-19 epidemic.

All of this has prompted automakers to pass on their knowledge to consumers, through successive increases in vehicle prices and increasing costs.

"Inflation may be trending down," the billionaire told his more than 102.2 million followers on Twitter.

In a separate posting, he added that more Tesla commodity prices are trending down than up.

"Are tesla costs going to rise?" a Twitter user asked.

Musk replied, "Too early to say for sure."

Millions of Tesla owners have been interested in Musk's posts, who are curious if Tesla car prices will decline due to decreasing inflation.

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"If inflation calms down, Tesla prices will fall, right?" said one fan.

Without any options offered by the Austin, Texas-based company, the base price for the Model 3 is currently $46,990, with the Model Y SUV, one of the world's best-selling electric vehicles.

Tesla took a little break at the start of the year. But in March, the automaker began raising prices once more. In April, Musk's group carried out a new price increase on long-range cars.

Will Tesla's prices drop?

The Model 3 sedan, long-range version, saw its price rise by $2,500, from $54,490 to $57,990, an increase of $3,000. The Model Y SUV/crossover, for its part, saw its price increase by $2,000, from $67,990 to $69,990.

The price of the Model S luxury sedan has dramatically increased. The price of the dual-motor all-wheel-drive version has increased from $99,990 to $104,990, up $5,000. The price increase for the Model X luxury SUV included the dual-motor all-wheel-drive long-range model also increased from $114,990 to $120,990.

Tesla has increased its profit margins due to these various pricing increases. According to its earnings report, the world's leading automotive business, by market capitalization ($880.2 billion as of the time of writing, posted a adjusted EBITDA margin (margin before interest, taxes, depreciation, and amortization) of 22.4% in the second quarter of 2022.

Musk promised to lower Tesla car costs if inflation eases in mid-july.

"If inflation calms down, we can lower car costs," the tech magnate promises.

On July 21, he reiterated his commitment during the second quarter earnings call.

Musk told analysts that when or if we see indications that the inflation rate is declining, we would not need to raise our automobile costs. "It is possible that there may be a minor decrease in car prices. But this is not something we control.

"If I were to make an educated guess, and I would take this statement with a grain of salt," the chief executive officer said the same day.

Consumer prices increased by 9.5 percent in the 12-month period through June.

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