With the release of the 2021 financial report data of major car companies, everyone was surprised to find that Tesla not only turned a loss into a profit, but its net profit was better than market expectations, ranking ninth in the net profit ranking of global car companies in 2021, breaking the "curse" that pure electric vehicle companies could not make money before.
Tesla also deliberately emphasized at the beginning of the earnings report that 2021 is a breakthrough year for Tesla, and the feasibility and profitability of electric vehicles should no longer be doubted.
Yes, Tesla not only did well in 2021, but also continued to gain momentum in the past Q1 2022, showing a more rapid posture.
New cars continue to sell well to boost business lines
In 2021, Tesla's total revenue was $53.823 billion, and its net profit attributable to shareholders was $5.519 billion, up 665% year-on-year. Full-year sales were a record 936,200 units, up 87% year-on-year. Total Q1 2022 revenue was $18,756 million, up 81% year-over-year. Net profit attributable to shareholders was $3,318 million, up 658% year-over-year. Sales of approximately 310,000 units increased by 67.7% year-on-year.
Compared with the gross profit margin of various car companies in 2021, Tesla's gross profit margin has far exceeded that of major auto groups and domestic new forces and other companies by more than 10 percentage points.
With the release of the 2022 Q1 financial report, the industry marveled that Tesla has achieved profitability for 11 consecutive quarters. CFRA upgraded Tesla's rating to "Strong Buy", Credit Suisse maintained its "outperform" rating, and Deutsche Bank maintained its "Buy" rating.
In a period from winter to spring, Tesla's total revenue and sales have accounted for about 30% of 2021, and the net profit has reached 60% of last year's performance. Gross margin continued to rise, from 30.6% in Q4 2021 to 32.9%, an increase of 4.1% compared to the same period in 2021.
In the full year of 2021 revenue, businesses such as "automobile sales and leasing", "energy production and storage", "services and others" contributed a large amount to profits, accounting for 85%, 5% and 7% of revenue contributions, respectively. In Q4 2021, Tesla's "services and other" businesses have broken even in the past five years.
In Q1 2022, the revenue contribution of the "automobile sales and leasing" business increased to 86%, further reducing the revenue share of energy and services (3% and 6%).
Although the sales revenue of regulatory points in 2021 decreased by 7.2% year-on-year compared with 2020, the breakthrough in sales for the full year of 2021 contributed to the new quarterly results of regulatory points sales revenue in Q1 2022 - achieving $679 million, an increase of 116% sequentially and a year-on-year increase of 31%.
"Selling carbon" not only increased the income from selling carbon, but also sold cars better and better.
From the perspective of sales, in recent years, the Model 3/Y in Tesla's SEXY product matrix has surpassed the Model S/X to become the main sales force, and relies on its mature production system to form a unique advantage of "one trick to eat everywhere".
Of the 6.5 million new energy vehicles sold globally in 2021, Tesla accounts for 14% of the total. Among the 3.3 million new energy vehicles sold in the Chinese market, Tesla's overall sales are not as good as BYD's, but it still leads Volkswagen, BMW, General Motors and other auto groups in the Chinese and US markets with four models.
Among them, the Model 3/Y also entered the top three annual sales of a single model with 167,000 units and 150,000 units in the Chinese market, respectively. Although the defeat of Wuling Hongguang MINIEV (395,400 units), it is true that the two have caused a lot of pressure on other brands.
In the 2022Q1 financial report, Tesla released a comparison chart of operating margins under GAAP, which can be seen that Tesla began to exert efforts from 2020 and completed the comprehensive surpassing of traditional automobile groups such as BMW, Mercedes-Benz, Ford, Volkswagen, Toyota, and Hyundai in the two years by the end of 2021.
In 2021, Tesla's net profit surpassed that of Hyundai Group, and it is the only new power company to enter the top ten list by selling only 4 pure electric models. Although other groups have not yet released their latest quarterly earnings reports, Tesla once again surpassed Hyundai Group in Q1 2022.
On April 25, Hyundai Motor Group released its Q1 financial report, with a net profit of about US$1.41 billion for the quarter, an increase of 16.8% year-on-year. While this is Hyundai Motor Group's best result since the second quarter of 2014, compared to Tesla's Q1 of $3.318 billion, the previous net profit gap widened from $224 million in 2021 to $908 million in 2022Q1.
Overall, due to the multiple impacts of the epidemic, supply chain and geopolitics, Hyundai Motor's global sales of Q1 were 902,900 units, down 9.7% year-on-year, and its sales in Korea and overseas were declining.
In terms of industrial structure, Hyundai Motor Group's business is divided into vehicles, steel, construction, accessories and others. According to reports, Hyundai Motor Group only accounts for about one-fifth of the group's business in the total number of vehicle business units. Compared with traditional car companies, Tesla's business structure is more focused on the transportation field, followed by Musk's personal dream.
In the process of corporate transformation, Hyundai Group started late in the electrification transformation and announced its medium- and long-term electrification development strategy in March. In addition to pure electric vehicles and fuel vehicles, it is clear that Hyundai has already bet completely differently on other automobile companies in the direction of hydrogen fuel cells.
Hyundai Motor Group's pure electric brand IONIQ and hydrogen fuel cell system exclusive brand HTWO are still in the early stage of development, the brand image still needs to be cultivated, the product matrix that complements fuel vehicles still needs to be optimized, and user cognition still needs to be consolidated.
Precise self-planning or increase confidence
At the end of the quarterly quiz, Tesla's self-analysis made people see that it not only revolves around car building, but also involves other areas that may become a new profit growth point.
Tesla believes that the main reason for the breakthrough in 2021 is the further reduction in the cost of bicycles, the increase in car deliveries and the increase in profits for other services such as car rental.
Through technological innovation, Tesla reduced the cost of bicycles to 36,000 US dollars, equivalent to 233,900 yuan.
Tesla expects to continue to implement innovations to reduce manufacturing and operating costs, but over time, hardware-related profits will be accompanied by accelerated growth in software-related profits. As a result, FSD remains one of Tesla's areas of focus, and future FSD-related profits are expected to accelerate their overall profitability.
In 2022, a large part of the revenue in the first quarter came from the increase in the price of its products to offset the shortage of raw materials and the income after the price increase. "Falling costs, rising average product prices and revenue from sales of regulatory credits are the reasons for the continued surge in net profits. Because the automotive sector is performing well and sales are growing, it is imperative to continue to increase production and sales in 2022. Production was also maximized at the Fremont and Shanghai plants by increasing production at new plants in Austin and Berlin.
Although Tesla said it would not launch a new model this year, Musk had previously said that it was developing a customized Robotaxi self-driving taxi, hoping to achieve mass production of Robotaxi in 2024. The Ark Investment Company of "Sister Wood" reported that the business will be a key driver of Tesla's profit growth, and to this end they raised Tesla's 5-year target stock price expectation to $4600. Electric vehicles are expected to account for 57 percent of the company's revenue by 2026, but profit margins will be much lower than those of the self-driving taxi business.
It is foreseeable that in the future, in addition to Tesla's automobile business, services, energy storage, and autonomous driving business will also become a new focus to improve performance, including space exploration, underground tunnels, brain-computer interfaces, hyperloops and recently purchased Twitter, Tesla's industrial layout is becoming increasingly rich.
Although none of the top ten Chinese car companies in the world's top ten net profits are on the list, Tesla's performance not only proves itself, but also proves that electric vehicles can obtain better gross profit margins than fuel vehicles, and to a certain extent, it also encourages the new forces of Chinese car manufacturing to achieve the dream of overtaking in curves. At the same time, an imaginative multi-business layout can help companies have a fuller brand image and new profit growth points.