Elon Musk believes the US government has understated the 'true magnitude' of inflation

• Elon Musk has suggested that government figures "understate the true magnitude of inflation."
• He spoke Wednesday on Tesla's Q1 earnings call about cost pressures on the business.

Elon Musk believes the US government has understated the "true magnitude" of inflation.

Inflation soared 8.5% in the year through March to a 41-year high, according to an official estimate.

In Tesla's first quarter earnings call Wednesday, Musk, CEO of the carmaker, said: "I think the official numbers actually understate the true magnitude of inflation."

He added that inflation "appears to be likely to continue for at least the remainder of this year."

Musk was responding to an analyst question about a recent jump in Tesla's prices, which went against the grain of the company's aim to cut prices and make its vehicles more affordable.

Musk said inflation had made that difficult.

He said Tesla's suppliers were under "severe cost pressure," with some requesting up to 30% cost increases for parts from 2021 to the end of 2022. "There's a lot of cost pressure there," he said.

In response to another analyst's question about hiking prices further, Musk said Tesla hopes it doesn't have to.

"The current prices are for a vehicle delivered in the future, like six to 12 months from now, so this is our best guess," he added.

Long-term contracts with suppliers were helping to keep Tesla's costs down in the short term, Musk said. But he recognized that these contracts would eventually come to an end, which could mean potentially significant price rises.

Tesla beat Wall Street's estimates for both revenue and earnings for the first quarter of 2022. The company reported that its revenue was up 81% year-over-year, while earnings per share more than doubled.