According to its latest earnings figures, Tesla is now raking in a billion dollars of profit a month.
US electric-car specialist Tesla has revealed a record net profit of $US3.32 billion for the first quarter of 2022, marking its 11th quarterly profit in a row after initially clocking up $US5 billion in financial losses over the last decade.
Despite raising the prices of its electric cars amid global supply chain shortages and rising manufacturing and materials costs, Tesla still managed to grow its first-quarter sales by 80 per cent compared with the same period last year.
The electric carmaker said it delivered 310,000 cars globally from January to March 2022, with overall revenue totalling $US18.8 billion in the quarter ending March 31, 2022 – up from $US10.4 billion the year prior.
These results saw the company exceed analyst and investor expectations, with shares in Tesla rising by 5 per cent after the close of regular trading.
Tesla’s co-founder and CEO Elon Musk – currently the world’s richest man – is also believed to be in line for a $US23 billion bonus in stock options as a result of the company’s record performance so far in 2022.
Although Tesla is the world’s largest manufacturer of battery-powered vehicles, its overall sales are modest compared to other major automotive brands.
Tesla sold 310,000 cars in the first three months of 2022 globally.
Japanese car giant Toyota – currently the world’s largest automaker – sold more than 2 million vehicles globally in the first three months of 2022, including 514,592 vehicles over the same period in North America alone.
Despite Tesla’s recent growth in sales and profit, it was no stranger to operating a loss in its formative years.
Tesla initially reported quarterly losses totalling more than $US724 million from the start of 2011 to the end of 2013.
That tally contributed to Tesla’s accumulated losses of $US5 billion from 2011 to 2019, however it clawed back lost ground after reporting a net profit of $US5.51 billion for calendar year 2021.
Finance expert Evan Lucas, head of strategy at Investsmart, an Australian online wealth portal, said Elon Musk’s recent endeavours to further control the automotive parts supply chain would cement Tesla’s advantage as a “first-mover” in the electric-car space.
“The one thing that Tesla has is incredible first-mover advantage,” Mr Lucas told Drive.
“It has incredible spread in terms of diversification of operations and it now has incredible (intellectual property) that only now (older car companies) are catching up to.
“Tesla also continues to be the first mover in soaking up the ingredients its cars need for the future. You can see what Musk is trying to do – he is trying to control the whole chain, from the manufacturing of the lithium to the battery components.
“It’s almost Henry Ford style – he is managing the assembly line out of the dirt to [the consumer].”
|Year||Tesla global sales, change from prior year (based on Tesla financial reports)||Vehicles produced|
|2021||936,172, up 87.4 per cent||Model S, Model X, Model 3, Model Y|
|2020||499,550, up 36 per cent||Model S, Model X, Model 3, Model Y|
|2019||367,500, up 50 per cent||Model S, Model X, Model 3|
|2018||245,240, up 138 per cent||Model S, Model X, Model 3|
|2017||103,120, up 35 per cent||Model S, Model X, Model 3|
|2016||76,230, up 51 per cent||Model S, Model X|
|2015||50,557, up 60 per cent||Model S|
|2014||31,655, up 41 per cent||Model S|
|2013||22,477, up 625 per cent||Model S|
|2012||3100||Model S, Roadster (2008 to 2012)|
Source: Tesla financial reports.
Speaking to investors after the earnings announcement, Elon Musk was confident the company could maintain its growth, saying his “best guess” was that Tesla could produce 1.5 million cars in 2022, likely achieving a 60 per cent increase in sales for the year.
Tesla cautioned, however, that its factories would likely continue to run below capacity “through the rest of 2022,” as is the case across the rest of the auto industry.
Some analysts have expressed doubts Tesla can survive the supply shortages and production issues plaguing other automotive manufacturers, with production at the company’s Shanghai gigafactory only recently restarting amid China’s aggressive zero-Covid policies.
“A robust demand story for Tesla is being overshadowed by brutal production issues in China as well as a Rubik’s cube supply chain, which continues to haunt Tesla as well as the rest of the auto/tech industry,” US investment firm Wedbush Securities told its clients ahead of the announcement, according to The New York Times.
Conversely, analyst Craig Irwin from US investment bank Roth Capital told Reuters Tesla’s price increases were “nicely exceeding cost inflation”.
“Chinese production issues seem well managed, and we expect Austin and Berlin to make up the slack from Shanghai’s 19-day outage,” Mr Irwin said.
After admitting earlier this year to reporting incorrect sales numbers in Australia, Tesla continues to dominate local electric-car sales with its Model 3 sedan.
Australians bought 4417 Model 3 cars in the first three months of 2022 despite the price going up by as much as $4000 and wait times pushing out to nine months.
That makes it the best-selling electric car in Australia by a significant margin with the second-placed Mercedes-Benz EQA only reporting 318 examples as sold over the same period.
It means, based on the latest Australian new-car sales data, the Tesla Model 3 sedan outsells its nearest electric-car rival by almost 14-to-one.