After reading Tesla's fourth quarter and annual financial report for 2021 released in the early hours of this morning, I had such an image in my mind: a handsome 28-year-old man with a lot of money, capable ability and great potential.
That's right, Tesla in the earnings report is like this.
"Handsome 28-year-old man" isn't talking about him, image from: Forbes
I'm rich
As expected, Tesla has been profitable for 10 consecutive quarters, but unlike before, Tesla has begun to make money by selling cars, rather than by selling carbon credits to survive.
In the fourth quarter of 2021, Tesla's total revenue reached $17.7 billion, up 65% year-over-year; GAAP operating profit of $2.6 billion, an operating margin of 14.7%, and GAAP net income of $2.3 billion, up 760% year-over-year.
For the full year, tesla generated $5.5 billion in GAAP net profit and $5 billion in free cash flow, excluding $6.5 billion spent on new plant construction and other capital expenditures.
Net profit (in billions of dollars), image from: Tesla
There are two main reasons for the increase in Tesla's operating profit:
The first is the cost of a bicycle. Technological innovations such as large castings, structural battery packs, and 4680 batteries have reduced Tesla's bicycle costs to about $36,000 (about 228,700 yuan).
This was followed by a significant increase in deliveries. Tesla achieved more than 50% growth target in 2021, delivering a total of 308,600 vehicles in the fourth quarter, an increase of 71% year-on-year; and delivering 936,200 vehicles in 2021, an increase of 87% year-on-year.
Regarding their profitability, Tesla said:
In 2021, Tesla achieved the highest quarterly operating gross margin of any production OEM and generated a GAAP net profit of $5.5 billion for the whole year, which not only shows Tesla's profitability, but also shows that electric vehicles are more promising than fuel vehicles.
I'm capable
Behind the surge in deliveries is a significant increase in production capacity.
Against the backdrop of an increasing global supply chain crisis, Tesla has reduced its global inventory cycle from 6 days to 4 days. In the fourth quarter of 2021, Tesla also achieved production efficiency of more than 1.22 million vehicles per year.
Final assembly workshop of the Berlin Gigafactory, picture from: Tesla
Tesla said its Fremont plant in California broke production records in the past year and is expected to have a total capacity of more than 600,000 vehicles. At the same time, the Texas Gigafactory also began production of the Model Y at the end of 2021, equipped with a 4680 battery.
On the other side of the Pacific, Tesla's Shanghai Gigafactory achieved annual deliveries of 484,100 units in 2021, accounting for 51.7% of total deliveries. Moreover, shanghai gigafactory, as Tesla's main export center, contributed more than 160,000 units to overseas market delivery.
The recently closely watched Berlin Gigafactory also launched production equipment testing at the end of 2021, and after obtaining local manufacturing permits, Tesla will begin to deliver vehicles manufactured at the factory in Europe, and the first vehicles will use 2170 batteries.
According to a Tesla internal email released by Chang Yan, the founder of the supercharger station, the Berlin factory in Germany is expected to officially deliver the Model Y in March this year and begin to contribute production capacity.
The production capacity of Tesla's factories, picture from: Tesla
However, Musk also admitted in the earnings meeting that Tesla has been in a state of insufficient capacity in the past few quarters. As a result, Tesla will also build a fifth gigafactory, and the location of the new factory will be announced this year.
What I make is great
Software services are seen as an important source of long-term profitability for Tesla.
"I'd be shocked if we don't get to autonomous driving this year." Musk said in the earnings meeting.
In the fourth quarter of 2021, Tesla released a total of seven fully automated driving (FSD) beta software updates. Currently, in the U.S., vehicles equipped with FSD Beta have also increased from a few thousand in the third quarter to nearly 60,000.
Image courtesy of InsideEVs
Musk said that in the coming months, the FSD stack will also make deep improvements. On the other hand, the supercomputer Dojo will also "come in handy" this summer, contributing little to the large-scale data training of autonomous driving.
If Dojo is competitive, we will consider supplying it to other companies.
For Tesla Bot, another "big star" at the 2021 Tesla AI Day, Musk said that Tesla's most important new product this year is not a car, but a humanoid robot.
Yes, it will be the most meaningful product over time. When labor shortages are no longer there, I don't even know what "economy" means.
Musk said Tesla Bot's first job this year will be a porter in a Tesla factory.
Tesla Bot, image courtesy of Tesla
When asked about Tesla's energy business and energy products, Musk acknowledged that the energy business is indeed not Tesla's current focus, but there has been some progress.
The financial report shows that Tesla's installed energy storage products in 2021 increased by 32% year-on-year. In fact, the market demand for Tesla's energy storage product Megapack has always been higher than that of production capacity, and supply constraints are still the biggest problem at present. Musk said it is currently building a factory dedicated to the production of Megapack products to meet market demand.
"If we actually meet the market demand, [Tesla's energy business] will grow 2 to 3 times." Musk said.
Finally, let's talk about the service aspect. In 2021, Tesla's second-hand sales business is very strong (of course, this is inseparable from the inability to deliver new cars), and other aspects of service, boutique and accessories sales have also improved profits. In addition, Tesla CFO Zachary Kirkhorn also said that by the end of 2022, 80% of Tesla users can choose Tesla insurance.
But what about this year's new car?
You may have found out, I talked a lot about it, why hasn't the new car been mentioned, is tesla not a new car this year?
You guessed it, Musk poured cold water on everyone as soon as he came up: Tesla won't release a new model this year.
Tesla's existing "SEXY" series, picture from: Tesla
As early as 2020, Tesla announced that it would make a compact car priced at about $25,000 (about 158,800 yuan). Earlier, some people said that it was called "Model 2", but Musk had publicly said that he hated the name, so everyone changed his name to "Model Q".
Let's leave it called, we won't be able to see this car this year anyway. For Tesla at this stage, ensuring production capacity is the most important thing, and Tesla's next performance will depend on its ability to climb capacity.
"We have too many tasks at the moment, and if we launch a new car, total production will decline," Musk complained, "and supply chain constraints are likely to continue for a whole year."
In addition to the $25,000 car, the Cybertruck, an electric pickup truck that has been jumping for many years, the Electric Truck Semi, and the Electric Sports car Roadster will still not be mass-produced this year.
The latest Cybertruck prototype, image courtesy of The Verge
The good news is not nothing, Musk said on January 26 that he has personally test-driven Cybertruck's latest prototype at the Texas factory, declaring the car "very good" .
Musk said that while batteries aren't what caused Cybertruck to jump tickets, there are a lot of new technologies that will take some time to implement, and it has to have a reasonable price.
Therefore, Tesla's main model this year will still be the "SEXY" series. After all, who doesn't love something that makes money?
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