Musk opened the Tesla factory in China, perhaps the most accurate bet!
Produced by | Financial Think Tank Author | Fan Zhilin
Tesla earned $20 billion in the first quarter
On the evening of April 20, Tesla announced its financial report for the first quarter of 2022.
According to the financial report, the company's first-quarter revenue was $18.756 billion, an increase of 81% year-on-year, exceeding the market expectation of $17.8 billion.
Net profit in the first quarter was US$3.318 billion, far exceeding US$438 million in the same period last year, equivalent to more than RMB20 billion, an increase of more than 6 times year-on-year.
Speaking of Tesla, it is natural to think of Tesla Motors, the company's revenue, the automotive business revenue of 16.861 billion US dollars, an increase of 87% year-on-year, accounting for 89.9% of the company's total revenue.
In addition, Tesla's automotive business gross margin reached 32.9%, a record high!
I have to say that Tesla's performance in the first quarter is very eye-catching.
According to the earnings report, Tesla's profit soared more than 6 times, mainly because of the sharp increase in Tesla's delivery quantity in the first quarter and the increase in sales prices.
The data shows that in 2021, Tesla delivered 963,000 vehicles, an 87% increase over 2020. In the first quarter of 2022, Tesla delivered 310,000 vehicles, breaking through a new high again, a year-on-year increase of 69%.
Elon Musk said that in 2022, it is still expected to increase the basic delivery volume by another 50% in 2021, which is a bright future.
From the financial reports released by the domestic new energy vehicle giants, compared with Tesla's financial reports, it will be found that one of the characteristics of the domestic new energy automobile giants is that they do not make money, and even lose money.
For example, Weilai Automobile has lost money for 6 consecutive years, and the latest annual report shows that it lost another 4 billion yuan in 2021.
Xiaopeng Automobile's 2021 financial report shows that its loss is as high as 4.863 billion yuan, surpassing Weilai!
Ideal Auto also lost 320 million yuan in 2021, and the three giants of new energy vehicles are in the middle of losses.
Only BYD has a profit of 2.443 billion yuan, but BYD is also dragging the government's blessing on new energy subsidies, coupled with BYD's other strong business support, if the government subsidies are removed, BYD's net profit in the new energy vehicle business is only about 900 million yuan.
Why can Tesla make money, BYD, Xiaopeng, Weilai, and Ideal can't make any money?
Profit or loss, perhaps the root cause lies in gross margin.
Among the major domestic giants, the gross profit margin of Xiaopeng Automobile is 12.5%, the gross profit margin of Ideal Automobile is 21.3%, the gross profit margin of Weilai Automobile is 20.1%, and the gross profit margin of BYD is 13.02%.
Tesla's latest gross profit margin in the first quarter reached 32.9%, which is difficult for domestic new energy giants to achieve.
In the case of BYD, the gross profit margin of 13.02% is almost at the bottom, but BYD relies on huge sales to support profits.
Tesla's high gross profit margin, perhaps the direct reason is the high price, in Tesla's popular sales of the car series, the lowest are 291,000, while other models are 316,900 starts, 890,000 started, 940,000 started.
This price, in the country has been called a luxury car!
On the contrary, the price of BYD car series is generally between 100,000 and 200,000, and sales of more than 200,000 are not popular.
In such a comparison of prices, Tesla's gross profit margin is naturally much higher!
Perhaps, domestic consumers still have the characteristics of "foreign goods" is "expensive, easy to use", label tesla, coupled with the atmosphere of admiration, making Tesla not only expensive, but also very good sales in the country, it is difficult to make money.
Musk was right
In fact, before 2019, Tesla has also been in a state of loss, Tesla after the listing in the United States, operating losses year by year, stock prices rose year by year, which is a miracle.
However, the real change in this situation is Musk's decision to cooperate with the Shanghai Municipality, build the Tesla China factory in Shanghai, and start selling Tesla vehicles in China at the same time.
After the sale of Tesla's new energy vehicles in China, it finally ushered in a rare quarterly profit, which was the first time since its inception.
It is no exaggeration to say that it is the Chinese market that saved Tesla!
Musk's move is indeed the right bet, building factories in China, selling in China, so that Tesla began to shine in 2020, sales, profits have begun to soar, Tesla's stock price is also in 2020 and 2021 rose the most fiercely, so that Musk became the world's richest man.
However, in fact, Tesla is not so strong in the DOMESTIC MARKET, because there are a number of traditional car giants such as GM and Ford in the United States, and Tesla really wants to compete and may not win.
Tesla can be said to be unable to win in the United States, and it has become a typical example of a giant in China.
Of course, this is not the characteristic of Tesla alone, and so is China's auto giants.
As we all know, there are too many auto giants in the Chinese market to count, Such as Dongfeng, Nissan, BAIC, GAC, SAIC, FAW, Volkswagen, BMW, etc., and these traditional auto giants have seen the future of the new energy vehicle track and have turned to the new energy vehicle track.
In the case of the influx of many giants, the domestic automobile market has actually become a red sea, and price wars are not uncommon, which is why BYD sells at a low price.
However, going abroad is different.
One of the most important businesses of BYD Automobile is to export new energy vehicles to foreign countries, from the United States to Europe, there are BYD new energy vehicles in motion.
Even if European and American countries are very wary of Chinese brands, chinese products are cheap, affordable and of excellent quality, and they cannot escape the law of true fragrance after all.
This kind of situation that cannot be sold at a price at home and sweeps across the world when it goes abroad is also true for Chinese brands.
Xiaomi is an ordinary second-rate mobile phone brand in China, but it has become an absolute giant in Africa and India, and the same is true.
Musk probably did not expect that after building the Tesla factory in China, it could develop so quickly.
In contrast, after Tesla's success in China, it plans to build a car factory in Germany to replicate this set.
As a result, an "animal protection" dragged on for more than a year, and even the land was not leveled.
If Tesla had not come to China, I am afraid that Musk would continue to live a loss-making life, and I don't know when it will be profitable.
However, Tesla's performance in the first quarter was stable, and the second quarter may not be so easy.
Due to the epidemic, Shanghai has been statically managed for nearly a month, and although the epidemic in Shanghai has begun to decline, it will take time to truly recover.
On April 19, Shanghai has allowed some companies to resume work and production under a closed-loop situation, including Tesla factories.
However, many parts of the country have now been continuously affected by the epidemic, especially in Zhejiang and Jiangsu, which are close to Shanghai, and most of the cities are in a semi-lockdown state.
According to this situation, Tesla's sales and deliveries in the second quarter will be greatly reduced, and it is not yet known whether 2022 can still do what Musk said will increase by 50% on the basis of 2021.
In addition, the domestic new energy giants, to learn from Tesla, the domestic market has been fighting a red sea, why not actively expand the overseas market?
Domestic cars have a huge advantage in cost, and when they go to overseas markets, it is a dimensionality reduction blow, perhaps this is a shortcut for domestic new energy giants to make a profit.
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