According to a leaked email from CEO Elon Musk, Tesla had a challenging quarter, with sales and profits down in Q2. Musk also said the company needs to work to get back on track.
In the email, purportedly sent to all Tesla employees, Musk wrote, “This has been a very tough quarter, primarily due to supply chain and production challenges in China. So we need to rally hard to recover!”
The company’s challenges include a massive recall of over 107,000 electric vehicles in China after a defect was found in the fast charging process, affecting models 3 and Y.
Additionally, zero Tesla vehicles were sold in Shanghai during April due to renewed COVID-19 lockdowns in China.
Another cause for concern is the recent crash of the cryptocurrency market. Musk has long been a proponent of crypto, including a memorable spot advertising Dogecoin during a guest slot on Saturday Night Live last year. Since that appearance, Dogecoin has dropped over 90% and is now trading at about six cents.
As a part of Musk’s enthusiasm for digital currencies, Tesla Motors has been heavily involved in buying Bitcoin. The company accepts Bitcoin as payment for its vehicles, one of the first major companies to do so.
In the first quarter of 2021, Tesla added a $1.5 billion investment in Bitcoin to its books. The exact purchase price of the coins is unknown but was estimated by Bloomberg to be approximately $34,700 per coin.
Bitcoin’s high point was near twice that amount, at a little over $68,000 per coin. At the time of writing, the price of a Bitcoin was $20,632, less than a third of its peak just weeks ago. However, Tesla has been buying and selling Bitcoin regularly since the initial investment last year, so the amount of the loss is unknown.
The company’s Q2 earnings report call is expected to occur on July 25.