Tesla’s profit from sales of electric cars slumped in the last three months of last year because of price cuts intended to thwart increasingly intense competition, the company said on Wednesday as it warned of a tough year ahead.
Profit in the fourth quarter nearly doubled to $7.9 billion, up from $3.7 billion a year earlier. But $5.9 billion of that profit came from a tax benefit. Without that one-time accounting effect, profit would have fallen.
Tesla has slashed prices for the two cars that make up the bulk of its sales — the Model 3 sedan and the Model Y sport utility vehicle — as automakers like BYD, in China, and General Motors, Hyundai, Ford Motor and Volkswagen, in the United States and Europe, have begun selling more electric vehicles.
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