Elon Musk Expects a Recession

When asked about the likelihood of a US recession at the Qatar Economic Forum this week, Tesla CEO Elon Musk shared his thoughts.

With two new plants under construction, the automaker is looking to ramp up production in the coming months, even as it raises the prices of all four of its models.

Even as Tesla CEO Elon Musk publicly raises doubts about Twitter’s share of bot accounts, the deal to buy Twitter is still in the works.

Tesla CEO Elon Musk has been warning of rough economic seas in the months to come, beginning with his signals about the prices of raw materials for the auto industry. A year ago, Tesla CEO Elon Musk said that rising raw material costs were behind the company’s price increases, and he reiterated the same this spring as other automakers faced much higher metal and other materials costs.

When asked about the likelihood of an economic downturn in the United States, Tesla CEO Elon Musk reiterated his stance this week at the Qatar Economic Forum.

“In any case, I believe that a downturn will come sooner or later. It’s more than likely, in my opinion, that we will experience a recession in the near future “According to what Musk had to say, However, he added, “It’s not an absolute certainty.”

Despite Tesla’s recent announcement that it plans to cut 10% of its salaried workforce while increasing the number of hourly workers, the company’s CEO cited a worsening economic outlook. This comes just weeks after Tesla opened plants in Berlin-Brandenburg, Germany and Austin, Texas. At a time when the auto industry is bracing itself for some surprises, the decision to cut salaried staff just as production was starting to ramp up at two new plants raised some eyebrows. This was partly due to the weeks of downtime at Giga Shanghai caused by anti-coronavirus measures implemented by Chinese authorities.

The CEO of Tesla and SpaceX is still working to complete the purchase of Twitter, which may have been more complicated and expensive than expected.

In the weeks following the initial public announcement of the deal, Tesla’s stock price plummeted after Musk raised concerns about the number of possible bot accounts on Facebook. Even as he raises more questions about the site, it is widely expected that Musk will complete the deal.

There appears to be no imminent recession at the time of the Twitter deal’s conception. Many observers have noted that Musk had likely been considering it for months, if not years, but it has now fallen victim to the unfortunate timing of the economic climate in which we find ourselves.

Tesla has recently raised prices across its entire lineup in yet another major price hike since March of this year, showing yet another sign of the company’s belief in an improving economic climate.

The recent move, which was implemented without warning last week, was widely seen as a response to rising raw material costs, which Musk had previously warned about. There were price increases of $6000 for the Model X and $5000 for the Dual Motor AWD Long Range model of the Model S. Several years prior to this, the base Model S had already surpassed the $100,000 price point and was now several times what it had been just a few years earlier.

Model 3 and Model Y, Tesla’s two more affordable models, saw price increases that were less pronounced in relation to their cost.