“Fantastic Year” – Tesla recorded a record profit of $12.6 billion

“It’s been a fantastic year, our best yet,” Musk said as he presented the numbers. But what about 2023? “We’re probably going to have a really tough recession,” Musk warned. However, should this happen, Tesla’s material costs should drop significantly as well. Either way, the outlook isn’t bright – without a stronger economic downturn, major central banks could continue to raise key interest rates, making financing car purchases even more difficult. Management knows there are questions about the “uncertain economic environment,” Tesla said in its letter to shareholders. Nevertheless, the market leader in the e-car segment has set ambitious targets for the current year.

Tesla wants to increase production “as quickly as possible” in 2023 and sees itself on track to deliver about 1.8 million cars for the full year. He sees the true potential at two million, Musk said. But certain external factors cannot affect Tesla. The group confirmed that it would continue to aim for annual growth of 50 percent in the longer term. But Tesla missed this target as early as 2022 – deliveries jumped 40 percent to 1.3 million electric cars. In the three months to the end of December, they only grew 31 percent over the previous year.

Huge price reductions
Recently, the company’s price cuts have led to further investor concerns about potential contraction in demand and shrinking profit margins. Some owners of older Teslas were also angry about the declining resale value of their cars. However, Musk defended the cut in a web conference with analysts and investors – it had always been Tesla’s goal to make electric cars affordable to the general public. He also resolutely refuted concerns about demand – orders are currently rising significantly faster than Tesla’s production.

The group continues to gear up for rapid growth – production capacity approximately doubled by 2022. Musk is planning more models, including the highly anticipated Cybertruck, which will finally enter production this year, and Tesla, which will open up the lucrative American pickup market. The company mainly blamed the situation in China last year for production and supply problems, where Covid lockdowns put a lot of pressure on the large factory in Shanghai.

Difficult position on the stock market
In the fourth quarter, Tesla increased net profit 59 percent year over year to $3.7 billion. Sales rose 37 percent to $24.3 billion. With this, the company achieved new records at the end of the year. The numbers beat analysts’ expectations — significantly in terms of net profit and slightly in terms of revenue. Investors initially reacted cautiously, but Musk’s statements during the conference call ultimately lifted the share significantly after the trading day.

Tesla had a hard time in the financial market last year. The share price collapsed by about 65 percent in 2022, but recently it has been going up again. Elon Musk’s escapades surrounding the controversial acquisition of the online platform Twitter and the sale of his Tesla stock to fund the roughly $44 billion deal were poorly received by investors. There are already complaints from influential major shareholders that the tech multibillionaire – who also runs space and rocket company SpaceX – is neglecting Tesla too much.