Home Headline News Tesla is Booming

Tesla reported a jump in first-quarter profits Monday on surging electric vehicle sales, and the manufacturer said it was on track to boost automotive capacity at factories in three countries.

The electric car maker set production and delivery records in the quarter, with the auto industry upstart’s Model 3 becoming the best-selling premier sedan in the world, according to chief executive Elon Musk.

“We’ve seen a real shift in customer perception of electric vehicles and our demand is the best we’ve ever seen,” Musk said on an earnings call.

“Only three and a half years into production and with just two factories, for Model 3 to be out-selling its combustion engine competitors is quite remarkable.”

Musk’s electric car company has faced questions in recent days following a fatal car crash in Texas and sharp criticism of the company on social media in China.

But Monday’s results were strong as Tesla essentially maintained its output from the fourth quarter despite “multiple” challenges that included the semiconductor shortage that has roiled the auto industry worldwide.

The company reported first quarter profits of $438 million compared with $16 million in the year-ago period, following a 74 percent rise in revenues to $10.4 billion.

– ‘Over the hump’ –

“Tesla’s forward progress continues in all the critical areas,” said iSeeCars analyst Karl Brauer.

“If there was any doubt whether Tesla is ‘over the hump’ of being a successful start-up company, I think it’s gone now.”

Tesla suggested it had escaped the worst of the semiconductor supply crunch, which has temporarily curtailed production at rival companies, by being technologically adaptive.

Tesla, which was co-founded by Musk with the mission of remaking the automotive market, noted the stream of new electric models unveiled by rivals including Detroit’s “Big Three” automakers, and US President Joe Biden’s promotion of electric car usage.

“We believe consumer confidence in electric vehicles continues to increase and more customers are willing to make the switch,” Tesla said.

“We are moving as quickly as possible to add more production capacity.”

Tesla said a production ramp-up in Shanghai is “progressing well,” while a new factory in Germany remains “on track” for production and deliveries in late 2021. A new factory in Texas also is on pace to begin production this year, the company said.

While the earnings topped estimates, the company has faced scrutiny over its “Autopilot” technology following crashes.

Last week, two federal agencies said they would investigate a fatal accident involving a Tesla that apparently had no one in the driver’s seat. That announcement was followed by a story in Consumer Reports in which testers demonstrated that a Tesla could be fooled into driving with no one behind the wheel.

Tesla has been working with investigators, and a study of the wreckage indicated there was someone at the wheel at the time of the impact, according to vice president of vehicle engineering Lars Moravy.

“We were able to find that the steering wheel was indeed deformed, leading to a likelihood that someone was in the driver’s seat at the time of the crash,” Moravy said

Tesla’s auto-steer feature was not engaged, he added.

Tesla also found itself in a firestorm in China last week after a woman wearing a t-shirt with the brand’s logo and the words “brake failure” climbed atop a Tesla model at the Shanghai Auto Show, yelling that she was nearly killed when the brakes on her Tesla malfunctioned.

The scene quickly went viral on Chinese social media, where trigger-happy users often take aim at both foreign and domestic brands over perceived malfeasance.

Tesla pledged to cooperate with an investigation launched by the city of Zhengzhou, where the woman is from.

Shares of Tesla fell nearly 2.5 percent in after-hours trading, with one analyst attributing the slip to a lack of a clear projection on production expectations for this year.

You may also like

logo-white

Your Trusted Source for Capital Markets & Related News

© 2024 LiveTradingNews.com – For The Traders, By The Traders – All Right Reserved.

The information contained on this website shall not be construed as (i) an offer to purchase or sell, or the solicitation of an offer to purchase or sell, any securities or services, (ii) investment, legal, business or tax advice or an offer to provide such advice, or (iii) a basis for making any investment decision. An offering may only be made upon a qualified investor’s receipt not via this website of formal materials from the Knightsbridge an offering memorandum and subscription documentation (“offering materials”). In the case of any inconsistency between the information on this website and any such offering materials, the offering materials shall control. Securities shall not be offered or sold in any jurisdiction in which such offer or sale would be unlawful unless the requirements of the applicable laws of such jurisdiction have been satisfied. Any decision to invest in securities must be based solely upon the information set forth in the applicable offering materials, which should be read carefully by qualified investors prior to investing. An investment with Knightsbridge is not suitable or desirable for all investors; investors may lose all or a portion of the capital invested. Investors may be required to bear the financial risks of an investment for an indefinite period of time. Qualified investors are urged to consult with their own legal, financial and tax advisors before making any investment. Knightsbridge is a private investment firm that offers investment services to Qualified Investors, Members and Institutions ONLY. Qualified Investors are defined as individuals who have met those Qualifications in the relevant jurisdictions. Members are defined as individuals who have been accepted into the Knightsbridge membership program. Institutions are defined as entities such as banks, pension funds, and hedge funds. If you are not a Qualified Investor, Member or Institution, you are not eligible to invest with Knightsbridge. All investments involve risk, and there is no guarantee of profit. You may lose some or all of your investment. Past performance is not indicative of future results. Knightsbridge is not a registered investment advisor, and this disclaimer should not be construed as investment advice. Please consult with a qualified financial advisor before making any investment decisions. By accessing this website, you agree to the terms of this disclaimer. Thank you for your interest in Knightsbridge.