Author 丨 Cheng Xiaoyi
Editor 丨 Kang Xiao
Produced by 丨Shenwang Tencent News Xiaoman Studio
At a time when global car companies besieged the supply chain, Tesla handed over the first quarter report card that revenue, profitability, gross margin and cash flow were higher than the market expected. Tesla CEO Musk said he "has never been as excited and optimistic about Tesla's future as he is today." The last time he said that was on the third quarter of 2020 earnings call.
After the U.S. stock market closed on April 20, Eastern Time, Tesla announced its first quarter 2022 financial report, up 5% after hours. The following is the core data:
· More than 310,000 electric vehicles were delivered in the first quarter, a record quarterly delivery record, 95% of which were more affordable Model 3/Y;
· Operating income in the first quarter was US$18.756 billion, an increase of 81% year-on-year, and revenue hit a record high in a single quarter for three consecutive quarters;
· Vehicle revenue for the first quarter was US$16.86 billion, up 87% year-on-year, including US$679 million from the sale of carbon credits;
· Net profit under GAAP in the first quarter was $3.318 billion, up 658% year-over-year. Non-GAAP net profit of $3,736 million, up 255% year-over-year;
· Gross margin under GAAP in the first quarter was 29.1%, and automotive gross margin was 32.9%;
· Free cash flow for the first quarter was $2.228 billion, up 660% year-over-year and down 19.7% sequentially.
Tesla was able to achieve double revenue and profit growth, mainly due to the scale effect, the increase in sales of the higher price Model S/X, and the increase in profit brought about by the price increase. According to the calculation of "DeepNet", Tesla's net profit on bicycles increased by 352% year-on-year to $11,000, and Model S/X sales increased by 625% year-on-year to 15,000 units. Tesla's domestic Model 3/Y price is higher than last year's low, with the highest increase of more than 7%.
Musk said on the earnings call that Tesla aims to achieve an annual production of 20 million vehicles by the end of the century, and at present, Tesla has completed 5% of the target. Musk expects Tesla to produce 1.5 million vehicles a year this year. He believes that the delivery of Tesla's Shanghai factory in the second quarter is basically the same as that in the first quarter, which means that the suspension of production at the Shanghai factory will have an impact on production capacity.
Credit Suisse believes that if the Shanghai plant resumes work a few weeks after production is still below normal levels, its production may be reduced by about 90,000 units. Morgan Stanley analyst Adam Jonas also lowered Tesla's full-year delivery forecast, which is expected to deliver 1.46 million units in 2022.
Not only that, but factors such as rising logistics and raw material costs and ramping capacity in new factories may reduce Tesla's gross profit margin in the second quarter.
Musk quoted an army adage, "Laymen talk about tactics, insiders talk about logistics." Tesla CFO Zachary Kirkhorn said that although there are some internal cost improvement strategies, outbound logistics is still a major challenge.
The supply of parts in Shanghai affects global production
The day after Tesla's Shanghai factory entered the white list of resuming production and work, 8,000 employees in Tesla's factory began to return to the factory one after another. Tesla's plan is to complete the ramp-up of production capacity within 3-4 days and reach the overall single-shift full capacity.
According to Tesla's official data, the Shanghai factory produces about 2,500 vehicles a day. That means three weeks of shutdown, and Tesla has a capacity gap of at least 50,000 vehicles.
What is more serious is that Tesla's spare parts inventory is not much, and if its suppliers cannot fully resume work and supply within a week, Tesla production will be hindered again. According to Tesla officials, the spare parts inventory of the Shanghai factory can now support a week's production plan.
A senior automotive person told the deep web, "If some (parts) can't be in place, then do the production of missing parts first, and then repair it." While this affects efficiency and is costly, "the cost of stopping production is even greater." ”
In the first quarter of this year, the Shanghai factory delivered 182,000 vehicles, accounting for 58.8% of Tesla's global deliveries. Its unexpected suspension of production has put forward higher requirements for the speed of production at Tesla's Berlin plant and Texas plant in the United States.
This year, the Berlin plant started production of the Model Y in March, and the Texas plant in the United States started production of the Model Y in April. According to Tesla's financial report, the world's five major production bases currently have a total planned production capacity of more than 1.05 million vehicles.
The shutdown of Tesla's Shanghai factory and its suppliers will affect not only one factory, but also some Chinese parts manufacturers will supply Tesla's factories around the world. However, Musk is more optimistic about the resumption of production and work in the Shanghai factory and surrounding suppliers, "Our Shanghai factory has resumed a fairly high production level, and so have our suppliers." ”
Musk expects that "production capacity may usher in a significant climb in the third and fourth quarters." "Last year, Tesla was able to divert the production capacity of the Shanghai factory to supply overseas regions due to the construction and commissioning progress of the Berlin factory in Germany, which was less than expected. After the pressure on the capacity of the Shanghai factory is apportioned this year, the domestic delivery volume may further increase.
From the second quarter to the fourth quarter of last year, tesla's sales in Shanghai factory accounted for only 16.4%, 11.6% and 13.2% of the sales in China, and this proportion returned to the level of 2020 in the first quarter of this year, reaching 36.9%.
The pick-up cycle has been up to one year
Whether you look at the overall gross margin (29.1%) or the automotive business gross margin (32.9%), Tesla is above the industry average. According to the incomplete statistics of "Deep Net", the gross profit margin of leading car companies in China and the United States such as Volkswagen, Toyota, General Motors, Ford, SAIC, ANDD is less than 20%, and some car companies even have no increase in revenue.
Since the second half of last year, many car companies have announced price increases because it is difficult to bear the pressure of a sharp rise in upstream raw material costs, and Tesla is the first to bear the brunt. However, at the current level of Tesla's gross profit margin, Tesla does not seem to have a reason to increase prices.
Musk responded that Tesla's waiting list for cars to pick up is long, "The cars ordered today will not arrive until a year later in some cases." "Therefore, the current tesla price is actually predicting the growth of supply chain and logistics costs in half a year to a year."
The reason why Tesla can hold down costs in the short term is that the previous contract with the supplier has not yet expired, so it is temporarily unaffected by the rise in raw material prices. But according to Musk and cfos, some supplier contracts may expire within the year, "from 2021 to 2022 within a year, some Tesla suppliers have asked to increase the cost of parts by 20% to 30%." Musk said.
In addition to this, Musk believes that the US officially underestimated the impact of inflation. U.S. inflation rose 8.5 percent year-on-year in March, a 40-year high, largely because of rising energy costs due to the Russian-Ukrainian conflict, according to recent data released by the U.S. Department of Labor.
Musk said, "I think the official data underestimates the true extent of inflation, which could run through the full year of 2022." While Tesla hopes that electric vehicles will become cheaper and cheaper, unfortunately, in the face of the changing macro environment, we must anticipate the increase in costs in advance. ”
In addition to being affected by their own value, commodity pricing is also affected by supply and demand. Musk said that Tesla is currently undersupplied, which also gives Tesla room to increase prices to a certain extent.
According to the current situation, Tesla will no longer reduce prices in a short period of time, and Tesla has become an "investment product" for a time. In March this year, due to the intensification of scalper scalping Tesla, Tesla had required the owners of multiple vehicles to purchase multiple vehicles at one time or a year to sign the "Letter of Commitment not to resell", promising not to talk about the transfer or actual transfer of any vehicles to a third party within one year after picking up the car.
In order to solve the cost pressure, Tesla may enter the mining industry
In order to solve the cost pressure caused by the rising price of upstream raw materials, Tesla is ready to enter the lithium mining and refining business.
Musk forwarded a tweet on April 9, US time, that lithium prices have risen for ten years, and said that "lithium prices have risen to crazy levels, and Tesla may have to directly enter the large-scale mining and refining business (of lithium mines)." He argues that lithium itself is not scarce, "because lithium is almost everywhere on Earth, but the rate of mining/refining is slow." ”
According to Benchmark Mineral Intelligence, a provider of professional information on the electric vehicle industry, lithium prices have exceeded 480% in the past year.
Price increases for key materials for five electric vehicle battery packs in 2021 Source: International Renewable Energy Agency (IRENA)
Musk reiterated that view on the third-quarter earnings call, "We're thinking about the limits that will emerge in the future of 'accelerating the world's transition to sustainable energy,' and whatever they are, Tesla will act on." "At present, the mining and refining of lithium is definitely the reason for the increase in the cost of sales.
Not just lithium, Tesla is poring over all the raw materials and trying to figure out the total amount of raw materials needed to 'accelerate the world's transition to sustainable energy.' Musk revealed that Tesla will make "some exciting announcements" in the coming months.
Recently, Tesla has begun to release geology-related positions, and former Rio Tinto Exploration Expert Zach Zens has issued a statement saying that he will join Tesla as a geologist.
Optimize your products with insurance
Musk said on the third quarter of 2020 earnings call that insurance will become Tesla's main product, and the value of the insurance business will account for 30% to 40% of the value of the vehicle business.
But to this day, Tesla has not disclosed the revenue and profit margins of the insurance business.
Zachary Kirkhorn said on the earnings call that it was not yet time to announce his financial position. He revealed that in Texas, the first region where Tesla launched insurance business, Tesla Insurance Company may become Tesla's first insurance supplier by the end of this quarter and the beginning of next quarter.
According to a screenshot of the car insurance cost uploaded by a Texas car owner, Tesla car insurance is only 56.83 US dollars / month (equivalent to 362 yuan), before its insurance cost is about 250 US dollars / month, Tesla car insurance price advantage is larger.
Tesla's car insurance product launched last year is a UBI (usage-based-insurance) car insurance designed based on real-time insurance. That is, according to the use time of the vehicle, mileage, driver habits and other information, design a new type of car insurance product with personalized pricing for different car owners. Tesla this week rolled out the product to Virginia, Colorado and Oregon.
Regarding why Tesla does car insurance, Musk gave an "uneconomical" answer this time. "Real-time feedback on driving habits will allow Tesla owners to drive the car in a safer way," Musk said, which is also a feedback mechanism for Tesla, which can clearly see how accidents are caused and then consider how to change the design of the car or software to minimize the possibility of accidents. "We're trying to turn nightmares into dreams with Tesla insurance."
The all-driverless taxi is obviously another "dream" of Tesla. Musk has already announced this month the launch of a fully driverless robotaxi, which will not be equipped with a steering wheel and foot pedals. In this earnings call, Tesla clarified the target time for Robotaxi to achieve: 2024.
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