March 14 (Reuters) – Tesla Inc (TSLA.O) CEO Elon Musk said the US electric car maker and his rocket company, SpaceX, are facing significant inflationary pressures in raw materials and logistics.
In a tweet on Sunday, Musk also asked about inflation expectations and said his companies “are not alone,” and retweeted an article in which he said the conflict between Ukraine and Russia had sent commodity prices to their highest levels since 2008.
The Russian invasion of Ukraine has driven up prices for metals used in cars — from aluminum in the chassis to palladium in catalytic converters to high-quality nickel in electric car batteries — and customers are likely to foot the bill.
Register now to get free unlimited access to Reuters.com
Tesla and SpaceX were not available for additional comments.
Rising raw material prices have raised concerns about the economics of electric cars, as automakers and start-ups prepare to launch new cars this year after overcoming problems with chip shortages.
In addition, geopolitical challenges arising from the invasion of Ukraine affected factory operations in the United States and made it difficult for suppliers of raw materials to set prices. Read more
“Just as hopes are fading that the semiconductor shortage … the invasion has caused new disruptions to the supply of essential materials and an alarming increase in prices,” said Susanna Streeter, an analyst at Hargreaves Lansdowne.
Wells Fargo analysts note that prices for nickel, a major material used in batteries, are up 130%, while cobalt, lithium and aluminum prices are up 16%, to 88% this year.
Tesla last week raised the prices of its popular SUVs and sedans in China and the United States by $1,000. Rivian Automotive Company (Rivno) It warned it would cut planned production in half, while Toyota Motor Corp. said it would cut production due to supply chain issues.
Shares of Rivian and Nikola Corp (NKLA.O) It fell between 0.7% and 2.7%, while Tesla was marginally higher in trading before the bell.
Register now to get free unlimited access to Reuters.com
Additional reporting by Akash Sriram and Javier Singh Shekhawat in Bengaluru; Editing by Rashmi Aish, Sherry Jacob Phillips and Shinjini Ganguly
Our criteria: Thomson Reuters Trust Principles.
“Unapologetic reader. Social media maven. Beer lover. Food fanatic. Zombie advocate. Bacon aficionado. Web practitioner.”
More Stories
The price of Bitcoin (BTC) has risen as the halving approaches
Netflix: Profits rise after password sharing campaign
Netflix reported strong subscriber gains but disappointing second-quarter revenue forecasts