Future Tesla Domination Will Get Confirmed From Q4 Results

Grace Tao, vice president of Tesla China, said Giga Shanghai could reach its 500,000 vehicle production target this year. This means Tesla China will make at least 195,000 cars. It will also mean that Tesla will produce an average of at least 70,000 cars in November and December. 70,000 cars per month would be 840,000 cars for a full year.

Tesla China will start and complete another expansion over the next five months. Tesla China’s capacity could reach 1.5 million cars per year by April, 2022.

Tesla China exceeding 500,000 for the year will mean over 950,000 cars for 2021 for the whole company and over 320,000 cars for the fourth quarter.

This can also mean that the Berlin and Austin factories could each reach over 500,000 cars in 2023 by matching Tesla China’s ramp. The Berlin and Austin factories are newer and have new gigapresses and Tesla could build more production lines. Each production line can produce about 700,000 cars per year when fully ramped. Two fully ramped lines could hit 1.4 million cars per year in each factory.

Tesla currently has large backorders of cars. The demand for 2.5 million Tesla cars per year is already confirmed based upon the buildup of backorders. Tesla China rapidly expanding to meet the demand will also show Berlin and Austin could achieve a fast ramp.

Tesla expanding China to 1.5 million cars per year capacity would mean over 2 million cars per year just from Fremont and China. It can also mean that 1.5 million cars per year from each factory in Berlin and Austin is possible for 2023.

2.5 million cars per year at $50,000 per car is $125 billion. Tesla has over 30% margin on its cars. This would mean $37 billion per year in gross profit in 2022. Tesla will also make more from full self-driving software, battery storage and other revenue. Tesla would be able to fund $30 billion per year an even faster expansion of new factories and facilities.

5 million cars per year at $50,000 per car is $250 billion. Tesla has over 30% margin on its cars. This would mean $75 billion per year in gross profit in 2023. Tesla will also make more from full self-driving software, battery storage and other revenue. Tesla would be able to fund $50 billion per year an even faster expansion of new factories and facilities.

Apple has $95 billion in net income in 2021. Tesla would reach profit levels of the other tech giants but with faster growth rates and more addressable market.

Volkswagen and BYD and all of the other automakers will not be able to keep pace.

BYD and Volkswagen are the number two and number three makes of electric cars now. They are each less than half of Tesla’s 2021 production. Volkswagen loses money on each EV they make. BYD is barely profitable and makes half of its revenue from smartphone batteries and other smartphone products.

Tesla is already vastly more profitable than any other EV maker. Tesla will become vastly bigger and vastly more profitable.

The average new car is now selling for $45,000 each. Production from other carmakers will be constrained in 2022 because of supply chain problems. Tesla will not have to lower its prices much to have this 5-10 million car per year demand.

Cybertrucks will start volume production in 2023.

Tesla will not need the $25000 car to reach ultra-high volume until 2024. This will likely be a $35,000-40,000 car initially. This would still be $5000 to 10,000 less than the average selling price of other new cars.

Tesla could trim $5000 to 10000 from cars with lower cost and more efficient 4680 batteries. Weight reductions from gigacasting and better batteries will reduce the size of the battery packs while still maintaining range.

Q4 and 2022 will confirm the faster than expected ramp of EVs and the faster Tesla ramp.

Tesla will capture over half of the global EV market. 80%+ EV share of the new car market should happen by 2027. Tesla could ramp to 40 million cars per year out of 60 million EV cars per year market in 2027. 40 million cars per year would e $2 trillion in revenue. $600-800 billion in gross profit each year.

SOURCES – Tesla, Tesmanian
Written By Brian Wang, Nextbigfuture.com (Brian owns shares of Tesla)

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