Record $1.55b profit for Tesla as Model 3, Model Y boom
- US$1.142b record profit
- First time profit has exceeded regulatory credit revenue from other car makers
- US$23m loss from Bitcoin
- “Public sentiment and support” for EVs at new high
- Tesla Cybertruck could be delayed
Tesla’s quarterly profit has topped US$1 billion for the first time, exceeding expectations and reasserting the EV brand as a dominant force in electric cars.
And Tesla today posted its second quarterly profit that didn’t rely on revenue from other car makers trying to avoid fines for exceeding regulated emissions limits – albeit no thanks to Bitcoin.
The Californian based car company today announced a record quarterly profit of US$1.142 billion ($1.55 billion) off the back of record quarterly sales of 201,304 vehicle deliveries from April to June.
Revenue from other car makers paying Tesla regulatory credits – to avoid receiving a fine that would have been higher than the credits – dropped 32 percent to US$354 million; the only other time Tesla’s profit exceeded what it received in regulatory credits from other car makers was Q3 of 2019 when it posted a profit of US$143 million of which US$134 million came from credits.
However, that declining revenue from credits – companies such as Stellantis (which owns 14 brands including Jeep, Fiat, Peugeot, Citroen and Maserati) have paid billions to Tesla over the years – still makes up 31 percent of Tesla’s operating profit.
Noting that “public sentiment and support for electric vehicles seems to be at a never-before-seen inflection point”, the result is the best ever for Tesla, outdoing the US$438 million profit from the previous quarter that was bolstered to the tune of US$518 million by regulatory credits.
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Tesla attributes “volume growth and cost reduction” to its increase in income but it was negatively affected by the ramp up of the new Model S (and soon-to-go-on-sale Model X), each of which is not expected in Australia until late 2022 at the earliest.
However, Tesla’s profit per car reduced as it increasingly leans on the cheaper Model 3 – now claimed to be the world’s best-selling premium sedan – and Model Y that during the quarter accounted for 98.9 percent of the company’s vehicle production.
Tesla said the average selling price declined 2 percent due to the low mix of more expensive Model S and Model X; the updated Model S – including the Model S Plaid – recently went on sale in America.
That average price per car was also hit by the ramp-up of production in the still-new China plant that now supplies cars to Australia; the Model 3 recently had its third major price reduction in Australia.
Tesla, which leads the market for EV sales – and comfortably outsells all EV rivals in Australia – and still has traditional brands chasing to catch its lead, also blamed “Bitcoin related impairment” for eating into its profit to the tune of US$23m.
None of which is likely to stop Tesla shares regaining some of the ground they’ve lost during 2021; following the profit announcement there was an early spike in the stock price following the profit announcement after the close of the New York Stock Exchange.
Tesla says it expects deliveries to grow more than 50 percent in 2021 over the 499,647 cars it delivered in 2020.
That suggests sales of somewhere north of 800,000 for the year, of which the company has already sold 386,181 in the first half of the year.
That suggests Tesla is expecting to sell at least 400,000 cars in the second half of the year.
However, there were more delays in store for upcoming models.
The much-hyped Semi truck that was unveiled in 2017 with promises of going on sale in 2019 has been pushed back to 2022.
And Tesla appears to be prising the door open to a delay in the Cybertruck ute, which is planned to be produced at the new Austin Gigafactory that is still under construction. Tesla’s Australian website still suggests buyers will take delivery of the Cybertruck – one of many new EV utes currently under development – late in 2021.
UPDATE: Tesla Cybertruck delayed until at least 2022
In its profit announcement the company said “we believe we remain on track to build our first Model Y vehicles in Berlin and Austin in 2021” and that “we are also making progress on the industrialisation of Cybertruck, which is currently planned for Austin production subsequent to Model Y”.
In the ever-optimistic Tesla-sphere that’s a lot of pieces to fall into place…
