Tesla profit tops target; Musk sees no demand problem

Tesla on Wednesday reported a smaller-than-expected drop in quarterly profit as a string of price increases on its electric vehicles (EVs) helped offset production challenges caused by COVID-19 lockdowns in China.

Chief Financial Officer Zachary Kirkhorn said Tesla was still pushing to reach 50% growth in deliveries this year, adding that while the target had become more difficult, “it remains possible with strong execution.”

Chief Executive Elon Musk said he expects inflation to start easing by end-2022 and most commodity prices to stabilize, Reuters reports.

Tesla does not have a demand problem, but a production problem, Musk told a conference call. He dismissed the idea that global economic problems were hurting interest in Tesla, despite vehicle prices’ rising to what he called “embarrassing levels.”

The US price of Tesla’s Model Y long-range version, now $65,990, is up more than 30% since the start of 2021.