Electric car manufacturer Tesla (NASDAQ: TSLA) has been reported recently, and for good reason. As more and more startups and established automakers release their own electric cars to the market, Tesla has been busy innovating and expanding production capabilities. Let’s take a look at some of the things that are going on with the company.
Third quarter results beat estimates
Take a look at some of the results from Tesla’s latest quarterly report.
|Metric system||Q3 2019||Quarter 3, 2020||Change to YOY|
|$ 6.3 billion||8.8 billion USD||39%|
|150 million dollars||$ 369 million||146%|
Working cash flow
|756 million dollars||$ 2.4 billion||217%|
Once again, however, Tesla broke expectations. At this time last year, the company had a net loss of $ 907 million in the first nine months of 2019; This year, the company posted a profit of $ 566 million.
Third-quarter sales were a record high for Tesla, which is somewhat predicted with record delivery figures. More impressive, however, may be how the company doubled its operating cash flow in the first quarter of the year thanks to higher margins and revenue growth. With Tesla growing rapidly in response to demand for its vehicles, a 217% year-over-year increase in operating cash flow certainly suggests the company can handle further cost growth. That is very important, as Tesla plans to spend as much as $ 12 billion over the next two years to expand the plant and increase production capacity. With $ 8.4 billion in working capital and growing cash flows, the company appears to be able to meet that $ 12 billion without financial stress.
Elon Musk announced lower prices
In a move that generated more buzz about the company, Tesla significantly reduced the price of stickers on the Model S in early October. With two discounts in a week, the automaker dropped nearly 7.5% in spending. fee for luxury car model, from 74,990 USD to 69,420 USD.
Why discount on a popular vehicle? Some claim the move was due to competitor pricing, as Musk announced a price cut shortly after newcomer Lucid Motors announced that their upcoming base model would cost $ 77,400, the equivalent of $ 69,900 after having the US federal tax credit. The Lucid Air will have an expected maximum of about 517 miles per charge, while the Tesla Model S has an estimated EPA range of 402. In this case, discouraging further technological innovation, a discount helps. The Model S remains competitive.
Competition is heating up in the electric vehicle market, with traditional auto companies increasingly offering petrol-electric hybrid options and a number of startups developing sedans, vans and even vehicles. even their own luxury electric motorcycle. But United States World & News Report still ranks Tesla’s Model S as the No. 1 electric vehicle in the US by 2020, largely based on acceleration, driving range and ample cargo space. However, with Lucid founded by former Tesla chief executive Peter Rawlinson making moves, that top position could be in jeopardy soon.
So increasing the number of people who can and are willing to buy Tesla’s premium model could be another reason for the price drop. The company does not currently have the capacity to fully meet the needs of its vehicles, so it is building factories fast. If consumers had more premium options to choose from and Tesla had a mile-long waiting list, the company could lose potential customers to other brands. The more accessible pricing for its flagship vehicle will keep it a lead in consumer perception until it makes another breakthrough.
“Full” self-driving mode announced
Another reason people are talking about Tesla is because it just started implementing a new self-driving mode for its vehicles, advertised as fully autonomous. While the system is still in beta, videos of Auto Drive vehicles promise future comfort and happy riders. Many consumers interested in buying a Tesla may be looking for a self-driving car, but this beta doesn’t seem to have met the hype yet.
Almost immediately after the launch of the feature, the US National Highway Traffic Safety Administration reminded drivers that “none of the vehicles available to buy today are self-driving” . What’s more, a series of other videos quickly started going viral online with malfunctioning system content that prompted drivers to quickly regain control of their vehicle. Consumer Reports has also released its second-ever ranking of driver assistance systems (obviously not fully autonomous systems), and despite its popularity, Tesla’s Autopilot feature on the Model Y only ranks second, reaching 57/100 points.
New features add to the Autopilot the ability to steer, accelerate, and brake in the same lane; The “full” version will allow the vehicle to automatically drive from the highway to the slope, change lanes, park, assist at intersections and find the driver in the parking lot when summoned .
Tesla was the first automaker to launch a semi-autonomous driving system, and it’s clear that it aims to deliver on its promise of offering customers a fully capable self-driving car. Despite the headlines, the system isn’t quite there yet.
But the company is constantly evolving, and with time and effort, Tesla will be able to accommodate customers’ needs for more cars and convenient driving. As a company, Tesla has encountered many challenges over the years, and eventually, Tesla was able to overcome it all and grow.