Tesla "crazy running": net profit soared by 665% in 2021, gross profit margin exceeded 30%

"2021 is a breakthrough year for Tesla. The market viability and profitability of electric vehicles should no longer be doubted. On January 27, Tesla summed it up this way when releasing its 2021 annual financial report.

According to the financial report data, Tesla's deliveries increased by 87% by about 940,000 units in 2021, and achieved production efficiency of more than 1.22 million vehicles per year. Based on huge deliveries, Tesla's total revenue in 2021 was about $53.7 billion, up 71% year-over-year, and net profit was $5.519 billion, up 665% year-on-year. Excluding the $6.5 billion spent on new plant construction and other capital expenditures, Tesla still has $5 billion in free cash flow.

Tesla's stock price once soared to $1200 at the beginning of the month, but then it started a downward mode with the army of technology stocks. After the release of the 2021 earnings report, Tesla's US stock rose 2.07% after hours at $937.41 per share. According to Forbes real-time rich list data, Musk is worth $242.8 billion, far behind the second place.

Puncturing the gross margin ceiling

In the fourth quarter of last year, Tesla achieved its tenth consecutive quarterly profit: total revenue for the quarter increased by 65% year-on-year to $17.7 billion; operating profit reached $2.6 billion, an operating margin of 14.7%,; net profit was $2.3 billion, up 760% year-on-year; automotive gross margin was 30.6%, achieving the highest quarterly operating gross margin among all production OEMs.

Tesla pointed out in its earnings report that the fourth quarter operating profit growth was mainly affected by the following factors: further reduced bicycle costs, increased car deliveries, and increased profitability in car rental, services and other businesses. Over time, software revenue will contribute to overall profitability to a greater extent. In the third and fourth quarters of 2021, tesla bicycle costs have dropped to about $36,000, and Tesla will continue to reduce costs by including large castings, structural battery packs, 4680 batteries and many more projects in the future. At the same time, Tesla also mentioned that the increase in raw materials, goods, logistics and expedited costs in the fourth quarter, as well as the increase in warranty and individual batch vehicle recall costs, also cut some profits.

"We have sufficient liquidity to support product planning, long-term capacity expansion plans, and other expenses. We plan to increase production capacity as quickly as possible, not only from new plants such as Austin and Berlin, but also to existing plants such as Fremont and Shanghai. We believe that the market competitiveness of electric vehicles will be determined by their overall supply chain and production ramping capabilities. Tesla said.

Tesla is currently producing a Model Y equipped with 4680 batteries at its Austin plant, and the first batch of 4680 battery cars will be delivered this quarter. Tesla also made it clear that it will not launch a new model this year, and is not advancing the development of a $25,000 electric car, preparing to launch the CYBERTRUCK, electric truck Semi and ROADSTER sports car next year. At the same time, this year will be the site for the next Tesla gigafactory, and the results are expected to be announced by the end of this year.

The Shanghai factory held up half the sky

"Deliveries are expected to easily grow to more than 50 percent in 2022." Tesla CEO Musk believes that this can be achieved with only the Fremont and Shanghai factories. That is, Tesla's deliveries will climb from 940,000 in 2021 to 1.4 million in 2022. It is reported that in the fourth quarter of 2021, Tesla's annualized production capacity has exceeded 1.22 million.

"China Times" reporter learned from Tesla China that the annual delivery volume of Tesla's Shanghai Gigafactory in 2021 was 484,130 units, an increase of 235% year-on-year, accounting for half of Tesla's global sales. Among them, Model Y, as a new force that only opened delivery in the Chinese market in 2021, broke through the market size of 200,000 vehicles in only one year, and reached the top of the first camp of luxury SUVs with the results of 200131 deliveries, becoming the key to Tesla's profit margin. In terms of exports, the Shanghai Gigafactory contributed more than 160,000 units to the overseas market delivery, covering more than 10 countries such as Europe and Asia, of which the model 3 has exported more than 130,000 units in 2021. It can be said that the local production of the Shanghai factory has played a key role in reducing the cost of Tesla bicycles and improving the stability of the global supply chain.

Either way, it looks like Tesla should be able to achieve their goal of maintaining an incredibly high level of delivery growth over the coming year." But supply chain issues are likely to become a common problem for Tesla in the coming years, as the entire auto industry is now shifting to electrification and will increase demand for semiconductors. That demand could drive prices up and erode Tesla's hard-won margins. Some insiders said. In this regard, Tesla said that it will strive to break through the supply dilemma by improving the vertical integration of the global supply chain and the technical reserves, including the ability of self-developed chips. In October 2021, Tesla's Shanghai R&D and Innovation Center was completed and put into use, which will strengthen China's local R&D capabilities.

Tesla aims to sell 20 million vehicles by 2030. However, a survey data provided by Bank of America predicts that tesla's market share in the United States will be lower than that of traditional automakers by 2024, and GM and Ford may be the biggest winners. Tesla will never have an opponent, but Tesla who "runs crazy" in the window period is like a teenager who has entered adolescence, and I don't know how many people can compete with it in the future.

Responsible Editor: Li Yan'an Editor-in-Chief: Yu Jianping