Tesla Reports Record Profit but Warns of Supply Problems

Tesla said Wednesday that profit leapt more than sixfold last year to $5.5 billion, the highest total in its 19-year history, as sales continued to surge, especially in Europe and China.

But the automaker warned that supply chain troubles stemming from the pandemic would continue to constrain production through this year.

“Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through 2022,” the company said.

The automaker reported that its revenue rose to $53.8 billion in 2021, from $31.5 billion a year earlier. Deliveries increased 87 percent, to 936,000 cars.

Tesla closed the year with a strong fourth quarter in which revenue climbed 65 percent, to $17.7 billion, and net income rose to $2.3 billion, from $270 million in the comparable period in 2020.

The company generated $4.6 billion in cash in the fourth quarter and ended the year with $17.5 billion in cash on hand.

Tesla said it was continuing to work on its Cybertruck pickup but gave no target date for production. The vehicle was supposed to go into production in 2021.

The company’s bottom-line figure included nearly $1.5 billion that it earned from selling regulatory credits to other automakers, a slight decline from the previous year.

Tesla grew last year despite a shortage of computer chips that limited other manufacturers’ production throughout most of 2021. It was able to mitigate the impact of the shortage by switching to types of chips that were more readily available and writing new instructions, or firmware, to be embedded into the chip.

In addition to its established factories in Fremont, Calif., and Shanghai, Tesla needs output from new plants it is building in Texas and Germany to maintain its rapid growth. It repeated a previous forecast that it expected sales to grow about 50 percent per year on average for the next few years.

“We aim to increase our production as quickly as we can, not only through ramping production at new factories in Austin and Berlin, but also by maximizing output from our established factories in Fremont and Shanghai,” the company said Wednesday. “We believe competitiveness in the E.V. market will be determined by the ability to add capacity across the supply chain and ramp production.”

The company said it hoped to begin shipping Model Y compacts made in Austin to customers. The start of production at the plant near Berlin has been delayed because of disputes with German authorities over permits. Tesla had expected to start making cars at the German plant by the end of 2021.

Tesla dominates the market for electric vehicles in the United States, but it is likely to finally face some serious competition this year. Ford Motor, General Motors, Volkswagen and Hyundai have all outlined ambitious plans to introduce new electric cars in the United States. Two fledgling electric vehicle producers, Rivian and Lucid Motors, also have just started shipping vehicles designed to compete with Tesla.

source: nytimes.com