Tesla Breaks The Curse Of Electric Vehicle Loss And China Market Helps To Win The First Profit Year

The production capacity of Shanghai factory model has been increased to 250000 in three years and will reach 450000 by the end of this year. In 2020, the capacity of the Shanghai plant will be only 150000.

Us electric vehicle maker Tesla (NASDAQ: Tesla) released its fourth quarter financial report in fiscal year 2020 after hours on January 27.

Tesla has been profitable for the sixth consecutive quarter and its first profitable fiscal year since its establishment in 2003.

Tesla's annual revenue in 2020 is $31.536 billion, an increase of 28% compared with that of the same period of last year; the net profit of Tesla in 2020 is $721 million, with a loss of $862 million in the same period of last year.

The direct reason for Tesla's profit is the large-scale growth of market scale. In 2020, Tesla will deliver 495500 vehicles worldwide, up 36% year on year. Although the target of 500000 vehicles has not been achieved, only 4500 units are missing. Tesla is one of the few auto companies to achieve growth in 2020 under the impact of the epidemic.

Over the years, although Tesla has set off an unprecedented heat in the automotive industry in recent decades, there is no fundamental breakthrough in the cost of electric vehicles, and the scale has not been released. On the whole, Tesla is still a loss making business. Tesla finally broke this "Curse" in 2020.

2021 will be a year when Tesla's production capacity and sales volume will explode. With the capacity of Shanghai Super factory climbing and Berlin super factory being completed and put into operation, Tesla may start a new round of electric vehicle boom in the world. Tesla said it expects auto deliveries to grow by more than 50% in 2021. In the next few years, auto delivery is expected to achieve an average annual growth of 50%.

Tesla is one of the few auto companies to achieve growth in 2020 under the impact of the epidemic. Photo by Zheng dikun

The profit is less than expected

Although Tesla achieved its sixth consecutive quarter of earnings, its fourth quarter performance in 2020 did not meet Wall Street's expectations.

According to the financial report data, in the fourth quarter of 2020, Tesla's total revenue was $10.744 billion, up 46% year-on-year; net profit attributable to ordinary shareholders was $270 million, up 157% from $105 million in the same period of last year, but lower than the third quarter's $331 million and lower than the market's expected $763 million. Adjusted earnings per share were $0.8, lower than market expectations of $1.03.

Tesla shares fell 2.14% to $864.16, down about 3% after hours.

Although Tesla's net profit exceeded $200 million in the fourth quarter of 2020, it fell month on month compared with the third quarter. Prior to that, in the third and fourth quarters of 2019 and the first, second and third quarters of 2020, Tesla's net profits attributable to common shareholders were $143 million, US $105 million, US $16 million, US $104 million and US $331 million, respectively.

It is worth noting that Tesla's gross margin was only 19.2% in the fourth quarter of last year, the lowest level since the fourth quarter of 2019.

To some extent, the change of sales structure has affected this. Although model 3 / y continues to sell well, sales of model s / x, which has a higher positioning and higher price, is declining.

According to the data, Tesla produced 179700 electric vehicles in the fourth quarter, up 71% year-on-year. Among them, the production of model 3 / y, which is more "user-friendly", increased by 88% year-on-year. The production of model s / x, which is more advanced, produced 16000 vehicles, down 10% year-on-year. The total number of vehicles delivered was 180667, a year-on-year increase of 61%. Among them, the delivery volume of model s / X was 18966, with a year-on-year decrease of 3%; the delivery volume of model 3 / y was 161701, with a year-on-year increase of 75%.

Although model 3 / y has achieved great market success, for Tesla, in order to improve its profitability, it needs to harvest more users in the high-end market.

On the same day that the financial report was published, model s, which was first launched in June 2012, finally made a major reform for the first time after eight years. Tesla released the mid-term model s and the new model x, which were launched on the official website of China.

The advanced interior design of the new model s has attracted the attention of the industry. There are three major changes: first, the design of the steering wheel is extremely bold, changing from a round to a flat bottomed rectangular steering wheel, which Tesla calls "yoke steering"; secondly, the large central screen has been changed from the vertical screen to the horizontal screen, and the full LCD screen has been retained; in the rear row, an 8-inch display screen has been added to provide entertainment for the rear passengers.

There are three versions of model s, including the long-range version, the plaid version and the plaid + version. The prices on the Chinese official website are 7999900 yuan, 9999900 yuan and 1174900 yuan respectively, with the range of 663km, 627km and 836km respectively. Among them, the previous price of plaid version was 1174900 yuan, down 174900 yuan. The first two versions will be delivered in March, while the plaid + version will be delivered by the end of the year.

The price of the model x four-wheel drive long-range version is 849000 yuan, with 580 km of service life. The price of the plaid version is 999000 yuan, with 547km of service life. It will be delivered in the third quarter of this year. Both new cars can be equipped with Tesla's fully automatic driving system FSD, with a price of 64000 yuan.

In 2020, the global sales of model s and model X are only 57000. With the introduction of mid-term modified models, the two models are expected to return to the growth track.

Shanghai's production capacity may double

In 2020, Tesla can achieve a substantial increase in sales, revenue and net profit, which is attributed to the Chinese market.

Although Tesla did not disclose its sales data in various markets around the world, thanks to the popularity of the domestic model 3, Tesla's sales in China will be close to 30% of the global sales in 2020. Judging from the growth trend, China will soon surpass the United States and become Tesla's largest market in the world.

According to the data of the China passenger Association, the sales volume of the domestic model 3 will reach 137459 in 2020, which is the sales champion in China's electric vehicle market. According to Roland Berger, a consultancy, Tesla sold 147000 new cars in China in the whole of last year, including 137000 model 3 and 10000 model s and model X.

At the beginning of 2021, Tesla launched the modified domestic model 3 in China, and introduced the domestic model y. the market response was booming.

"If you place an order for model y, you have to wait until the third quarter to pick up the car as soon as possible. It will take about two to three months to pick up the car. " On January 28, a Tesla Beijing salesman told the 21st century economic reporter.

Many people familiar with Tesla told the 21st century economic report that the popularity of model y orders is higher than Tesla China's expectations, and the Shanghai factory is speeding up the progress of increasing production capacity.

Tesla said that the Shanghai factory model's production capacity has been increased to 250000 in three years and will reach 450000 by the end of this year. In 2020, the capacity of the Shanghai plant will be only 150000.

The arrival of Tesla Model y will further boost Tesla's domestic market share. Earlier, many industry analysts, including Cui Dongshu, Secretary General of the China Travel Association, said in an interview with the 21st century economic report that the sales volume of Tesla in China will exceed 300000 this year.

Thanks to the continuous improvement of Tesla's cost control ability and localization level, Tesla Model y has a higher gross profit rate as well as a lower price. This has a huge impact on competitors.

At present, there are luxury brands to face the price cut. On the evening of January 27, BMW Brilliance announced that it would reduce the official price of pure electric BMW ix3, which was launched in November last year. After the price adjustment, the price of ix3 leading model was 399900 yuan, and that of ix3 innovative collar model was 439900 yuan, which was 70000 yuan lower than the previous price.

Weilai automobile, which adjusted the rights and interests of lifelong free electricity exchange in October last year, announced once again on January 22 that it would adjust the power exchange policy to increase the frequency of free electricity exchange.

Of course, Tesla will face more competitors in 2021. In the middle of January, FAW Volkswagen and SAIC Volkswagen respectively launched the I.D 4crozz and I.D 4x models built by MEB, a brand-new pure electric platform of Volkswagen. Toyota will also bring great action in the field of electric vehicles at this year's Shanghai auto show.

Finally, the promotion of sales volume is inseparable from the support of the market. Tesla has a large number of fans in China and even in the world. However, with the increase of the number of cars, the problems of the vehicle itself and enterprise management have been magnified, which has more or less hidden dangers for the sales prospects of Tesla.

Tesla's own products have also exposed many problems. In addition to the frequent reports of battery fire, vehicle out of control and so on, there are even "low-level errors" like bumper design defects. In addition to these product defects, Tesla's handling of these problems has become a controversial point of much criticism.

As multinational car companies have laid out the new energy vehicle market and automatic driving field, whether Tesla can continue to maintain its advantages will be answered by the market.

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