Tesla, benefiting from a growing interest in electric vehicles, for the first time posted a full-year net profit in 2020 of $ 721 million, and intends to continue to ramp up.
Founded in 2003, the group led by Elon Musk has long focused on expanding production, investing billions of dollars in new sites and models, rather than profitability.
Its Fremont plant in California is now well established, while the Shanghai plant began delivering its first vehicles in late 2019.
This allowed the company to deliver 499,550 cars in 2020 and nearly hit the half-million forecast it set at the start of the year, despite the pandemic.
The spread of COVID-19 led to the temporary suspension of production at its California plant in the spring, and other major manufacturers have seen their sales drop.
Support from the authorities
The company also benefited in 2020 from a significant increase in revenue from credits granted by the authorities to manufacturers of vehicles that do not emit emissions.
Its revenue grew 46% in the fourth quarter to $ 10.7 billion and year-to-date 28% to $ 31.5 billion.
Fourth quarter profits disappointed observers a bit. From October to December, net income was $ 270 million. Adjusted per share and excluding one-time items, it fell to 80 cents where analysts had expected $ 1.01. The group’s gross margin, at 19.2%, was also lower than expected.
While the group’s deliveries increased, the average price of vehicles sold fell 11% as customers bought more Model 3s and Model Ys, which were cheaper than the Model S sedan and the Model X SUV.
Tesla also had to pay $ 267 million in the fourth quarter to Elon Musk, the leader having reached certain financial goals.
Tesla’s title dropped more than 5% in electronic trading following the close of the stock market after having already lost 2.1% during the day.
However, this is a minor setback for the group: its action has soared by nearly 750% in 2020, and around 17% since the start of the year.
At $ 820 billion, Tesla is now worth more than Facebook in New York City.
Tesla intends to continue its momentum: the group plans to increase its deliveries by 50% on average per year for several years, which would amount to around 750,000 vehicles for 2021. This would still be a long way from traditional manufacturers, Volkswagen having by example sold 9.3 million units in 2020.
“It is possible that we will go faster in some years, as will probably be the case in 2021”, he added in a statement without further clarification.
Tesla is counting on the start of production lines in its factories under construction in Berlin and Texas during the year, as well as on the acceleration of production in Shanghai.
The group, which also produces solar panels, also hopes to start delivering a semi-trailer by the end of the year and new versions of the Model S and Model X in February.
The transition to these new versions will perhaps slow down production a bit at the start of the year, CFO Zach Kirkhorn warned during a conference call.
The group “is working extremely hard to manage the global shortage of semiconductors,” he also warned.
Elon Musk also highlighted the progress on the autonomous driving software developed by the company and said he was ready to license it to other manufacturers.
The company will benefit from a favorable environment for electric vehicles, with the new US President Joe Biden having made the fight against climate change one of his priorities. The Chinese government also offers aid for the purchase of non-polluting cars and demand is soaring in the country.
But Tesla will also have to face growing competition, Volkswagen or General Motors having for example promised the imminent arrival on the market of several electric models. In China, the Nio and Xpeng groups are also growing.
“Although there is not yet a real competitor to Tesla in the arena of electric vehicles, a greater number of models eligible for tax credits could turn some buyers away from Tesla,” notes Jessica Caldwell, specialist in electric vehicles. sector at Edmunds.