Tesla’s fourth-quarter results are an early sign that the pioneering automaker is entering a new phase, according to Wedbush analyst Dan Ives. Tesla beat estimates on both the top and bottom lines for the fourth quarter. However, automotive gross margin was 25.9%, down from more than 30% a year ago. The decline suggests Tesla will have to be aggressive on pricing to defend its turf, as the rest of the auto industry joins the race in the electric vehicle space, Ives said Wednesday. “They end up having to sacrifice margin for volume. And now the question is, with the price war going on in China, what does the trajectory look like in 2023,” Ives said on CNBC’s “Closing Bell: Overtime” on Wednesday. Tesla has implemented widespread price cuts in recent weeks, which may be due to increased competition. “This is what I see as the moment of truth for Tesla. Can they ramp delivery – which we believe they can – and scale and maintain margins, which is well above the industry,” Ives said. Tesla maintains its long-term outlook for 50% compound annual growth in vehicle deliveries, but its projection of 1.8 million for 2023 will fall below that mark. Ives said it’s smart for companies to roll out more realistic numbers in an uncertain economic environment.