The Tesla rally continues: Thanks to high demand in Europe and China, the US electric car maker did surprisingly well at the end of the year and is making faster progress than expected with its new projects.
In the three months to the end of December, tech billionaire Elon Musk’s company had the second quarter in a row in the black – the profit clearly exceeded expectations. Tesla also announced that it would deliver more than 500,000 cars in 2020. After many new customers were reached with the mid-range Model 3 car, Musk is now pushing the pace of the sister model, the compact SUV Model Y.
The annual report put investors in a good mood.
The stock skyrocketed at times by around twelve percent after the exchange and passed the $ 600 mark for the first time.
Tesla’s profit in the previous quarter, record deliveries, the turbo start of the plant in China and the ambitious plans for the first European factory in Grünheide near Berlin had already caused the course to explode in the past few months. The share has risen by 39 percent since the beginning of the year, and the price has more than doubled since autumn.
With a market value of just under $ 105 billion recently, Tesla is now trading significantly higher on the financial market than the two largest US manufacturers, General Motors (GM) and Ford, measured in terms of production and market share. Tesla recently even passed the world’s largest manufacturer Volkswagen, even if the comparison here is somewhat more difficult due to the different capital structures. In any case, it is clear that the Californian company on Wall Street has had a very impressive run for some time.
Whether the business figures justify this euphoria is another matter. In the fourth quarter, Tesla exceeded market expectations with a profit of $ 105 million (€ 95 million), but is a decrease of 25 percent compared to the previous year. At $ 7.4 billion, sales were significantly higher than expected, but compared to the previous year there was only a slight increase of two percent. The first annual profit since the company was founded in 2003 is still a long time coming. The bottom line in 2019 was a loss of $ 862 million. After all, that was less than the $ 976 million misery last year.
But after a lot of initial skepticism and problems with the ambitious specifications of CEO Musk, Tesla actually seems to have found the track. The plan to conquer the mass market with the Model 3 and make money in the process can obviously work. In 2020, Tesla plans to deliver more than 500,000 cars, compared to 367,500 in the previous year. With the Model Y, Musk can now prove that bumpy production starts are a thing of the past. In the US plant in Fremont, production of the compact SUV is already underway – this is ahead of its schedule, the letter says to the shareholders.
/ Hbr / DP / eg
PALO ALTO (awp international)
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