22.3 C
Los Angeles
Monday, September 26, 2022

Tesla’s quarterly profit nearly quintuples to $1.6 billion as car sales surge.

Must read

News Centerhttps://dropdowndeals.com
Breaking news from around the world, plus business, drop down deals, politics, style, travel, sport and entertainment.

Tesla made $1.6 billion in the three months ending in September, the second quarter in a row that its profit has exceeded the billion-dollar mark.

The bottom-line figure exceeded the $1.1 billion it made in the second quarter and was nearly five times its profit from the third quarter of 2020.

The automaker reported a big jump in revenue, to $13.8 billion from $8.8 billion a year ago, as sales of the Model Y continued to rise in the United States, China and Europe. The company delivered 241,000 cars to customers in the quarter, up from 140,000 a year ago.

Electric vehicle “demand continues to go through a structural shift,” the company said in a statement. “We believe the more vehicles we have on the road, the more Tesla owners are able to spread the word about the benefits of E.V.s.”

Tesla repeated a previous forecast that sales would grow about 50 percent per year on average for the next few years, but the company cautioned that “semiconductor shortages, congestion at ports and rolling blackouts have been impacting our ability to keep factories running at full speed.”

The company said it expected to begin production of the Model Y at new factories near Berlin and Austin, Texas, before the end of the year. “The pace of the respective production ramps will be influenced by the successful introduction of many new product and manufacturing technologies in new locations, ongoing supply chain-related challenges and regional permitting,” Tesla said.

In an important shift, the company said it would start using lithium iron phosphate batteries for all but its long-range cars. Those types of batteries, which are popular in China, tend to be cheaper because they do not use cobalt, an expensive mineral that is primarily mined in the Democratic Republic of Congo. Lithium iron phosphate batteries can store less energy than the lithium ion batteries that Tesla had been using in most of its cars.

A portion of Tesla’s profit comes from selling regulatory credits to automakers that need them to meet emission standards. Tesla reported $279 million in sales of such credits in the third quarter, compared with $397 million in the third quarter of 2020.

The strong earnings report indicates consumers are still flocking to Tesla even as the company faces questions about the safety of its Autopilot driver-assist system and as established automakers roll out electric cars and trucks.

Autopilot, a computerized system that uses cameras and other sensors to steer, brake and accelerate cars on its own, is the subject of an investigation by the National Highway Traffic Safety Administration, the top federal auto-safety regulator. The agency is looking into whether Autopilot fails to see parked police cars and other emergency vehicles with flashing lights. The agency has identified 12 accidents in which Teslas operating in Autopilot mode crashed into emergency vehicles.

Tesla recently sent a software update to Autopilot-equipped cars that was supposed to improve detection of emergency vehicles. The traffic safety agency asked Tesla to provide extensive data about the fix and to explain why it did not initiate a safety recall before distributing the update.

The traffic safety agency had come under criticism for a lax approach to regulating new technologies like Autopilot and self-driving cars. On Tuesday, the Biden administration appointed Mary Cummings, a Duke University expert in self-driving technology, to a senior auto-safety post at the federal agency, signaling that Tesla may now face tougher scrutiny.

Ms. Cummings has criticized Autopilot, noting the system does not effectively monitor drivers to make sure they are paying attention to the road. In a message posted on Twitter, Tesla’s chief executive, Elon Musk, said on Tuesday that Ms. Cummings was “extremely biased” against Tesla.

Tesla does not appear to have lost many customers to competitors. Ford Motor began selling its Mustang Mach-E, an electric sport-utility vehicle, but its sales have been modest by the standards of the Model Y because the global shortage of computer chips has disrupted production for most auto manufacturers. Rivian, a start-up considered a potential rival to Tesla, has started producing an electric pickup truck, but so far it has only delivered a small number to customers; the company won’t say how many.

Porsche, the German automaker owned by the Volkswagen Group, has made inroads against Tesla with its Taycan electric sports car. In the first three quarters of this year, Porsche has sold more than 28,000 Taycans, which starts at about $82,000, about as much as a Tesla Model S or Model X costs. By comparison, Tesla sold 13,000 S and X vehicles.

News Centerhttps://dropdowndeals.com
Breaking news from around the world, plus business, drop down deals, politics, style, travel, sport and entertainment.

More articles

Latest article