Tesla Inc reported profits that were better than expected in the latest quarter, even as it gave mixed signals on the outlook for growth in electric vehicle (EV) deliveries.
The EV market leader said it would increase output “as quickly as possible” — in line with previous guidance for average annual growth of 50 percent over multiple years.
However, Tesla said it is on track to deliver about 1.8 million vehicles this year, which would represent a production jump of about 37 percent.
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On a call with analysts, Tesla CEO Elon Musk said that the outlook is conservative, saying that production could be closer to 2 million vehicles without unexpected disruptions.
He sought to dispel questions about consumer demand for Tesla vehicles as the company ramps up production.
“The most common questions we’ve been getting from investors is about demand. So I want to put that concern to rest,” Musk said, adding that Tesla is currently receiving orders at almost twice the rate of production following dramatic price cuts.
“Demand will be good despite probably a contraction in the automotive market as a whole,” he said.
The automaker now has four plants on three continents, including its newest in Austin, Texas.
The Austin-based company reported adjusted earnings of US$1.19 a share, besting the US$1.12 per share estimate of analysts compiled by Bloomberg.
Tesla doubled its production capacity last year. Its annualized production estimate for the fourth quarter was a new record, and near the company’s total production capacity for the first time.
Tesla also confirmed that it is on track to start building its long-awaited Cybertruck in Austin later this year, with more details of its next-generation vehicle platform planned at an investor day on March 1.
Musk said that Cybertruck production would not happen at volume until 2024. That gives rival vehicles more time in a first-mover advantage in the nascent electric truck market, including Ford Motor Co’s F-150 Lightning and Rivian Automotive Inc’s R1T.
Tesla’s fourth-quarter revenue was US$24.3 billion, slightly topping market expectations.
However, gross automotive margins were 25.9 percent, below analysts’ average estimate of 28.4 percent — a sign of potential concern for investors following a recent round of price reductions. In the same period last year, gross automotive margin was 30.6 percent.
Musk said that last year was difficult due to shutdowns at Tesla’s China factory, higher borrowing costs and logistical issues, adding that price cuts were needed to make vehicles more affordable to mass-market buyers, he added.
Income from the sale of regulatory credits — used by other automakers to offset greenhouse gas emissions — came to US$467 million, up from US$286 million in the prior quarter and US$314 million a year ago.
Tesla has said it expects such revenue to shrink over time as competitors launch more EVs to comply with emissions regulations and meet growing demand.
Tesla reported its second straight quarterly drop in customer deposits — down to US$1.06 billion — after hitting an all-time high of US$1.1 billion exiting the second quarter last year.
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