Tesla (NASDAQ: TSLA) shares gained nearly 3% in pre-market trading during these trading moments on Monday, after Reuters reported that the company was preparing to manufacture a new electric car model with a target price of €25,000.
Tesla CEO Elon Musk allegedly indicated his desire to release this new model during a recent visit to the Tesla facility in Germany. The story makes no mention of when the manufacture of this vehicle will commence.
It’s worth noting that the cheapest price for a Tesla car in Germany today starts at 42,990 euros. Tesla is therefore looking to boost sales by capturing an additional share of the European market with this low-cost car, which is scheduled for launch.
Meanwhile, the Wall Street Journal has reported that Tesla will be increasing the wages of workers at its Berlin factory. They will benefit from a 4% pay rise starting in November. These wage increases were revealed during a visit by the company’s CEO, Elon Musk, to one of the company’s factories near Berlin.
This happened as the firm came under growing criticism from Germany’s IG Metal trade union, which had earlier claimed that the company’s pay was roughly 20% lower than the minimum specified in the collective agreement.
The yearly salary of German industrial workers will be hiked by 2,500 euros beginning in February of next year.
In addition, Tesla will offer a bonus of 1,500 euros (approx. $1,609) to its employees in December to compensate for the rise in inflation.
Tesla (NASDAQ: LCID) shares rose by around 3% in pre-opening trading following the announcement of the new low-cost electric car, but the stock has now trimmed its gains to rise by just 1.7%. This comes after the stock closed up 0.66% on Friday, recording $219.96.
Tesla’s third-quarter results for the current year, released last month, showed that revenues, net income, and gross margin were all below expectations, as the company took strong measures to reduce the prices of its cars.
Profit margins fell to their lowest levels in the third quarter of this year, reaching 17.9%, compared with over 25% in the third quarter of last year.
Tesla’s net earnings also fell by around 44% year-on-year in the third quarter, to $1.85 billion.
Some analysts were expecting the company to have to cut prices further to meet its annual production target of 1.8 million cars.
