Tesla: Electric carmaker's shares slide after Musk warns of slowdown

Shares in Tesla slumped by more than 12% on Thursday after it warned its sales growth would be weaker this year than in 2023.

That wiped around $80bn (£63bn) off the company's stock market value.

The electric carmaker, which is led by multi-billionaire Elon Musk, said its sales growth "may be notably lower" in 2024 despite cutting prices.

Tesla's annual earnings, which were announced on Wednesday, also came in below Wall Street expectations.

The company has been cutting prices in key markets around the world, including Europe and China, as it faces tough competition from Chinese rivals such as BYD, as well as traditional carmakers.

Demand has also been dampened by persistently high borrowing costs as central banks around the world keep interest rates high as they try to curb inflation.

Tesla said price cuts, as well as higher research and development spending and costs associated with increasing production of the new Cybertruck, have eaten into its profit margin.

The company also said it was "between two major growth waves" and was planning to start production of a new lower-cost vehicle in the second half of next year.

Mr Musk also warned investors that Chinese competitors "will pretty much demolish most other car companies in the world" unless trade barriers are put in place.

His call for trade barriers in the increasingly competitive market came after BYD overtook Tesla as the world's top-selling electric carmaker in the last three months of 2023.

Tesla's warning of a slowdown comes after years of strong growth and reflects concerns about weakening global demand for electric vehicles.

Tesla's shares have now lost more than a quarter of their value so far this year.