Tesla CFO: There's a 'profound awakening' in the electric car sector

Posted on October 21, 2021 by Matt Pressman

Once again, Tesla broke records and exceeded expectations for the quarter. But, their third quarter earnings call was quite different this time around. As expected, there was no commentary from company CEO Elon Musk. Instead, CFO Zachary Kirkhorn helmed the call with input from top execs. Even without colorful soundbites from Musk, there was plenty of surprising news.

Above: Growth for Tesla is being led by the company's newest SUV, the Model Y (Source: EVANNEX; Photo by Casey Murphy)

Kirkhorn's style, in contrast to Musk, is more subdued. He's a matter-of-fact, no-nonsense numbers guy. When asked what's driving Tesla's growth right now,  Kirkhorn noted that Tesla "completed the transition of our Shanghai factory as our main export hub." Giga Shanghai is shipping cars to Europe and Asia and that's helping supercharge growth for the company.

Around the globe, Kirkhorn says, "the great thing that we're seeing in the space right now is there appears to just be quite a profound awakening of the desirability for electric vehicles. And I mean, to be totally frank, it's caught us a little bit off guard... folks want to buy an electric car and folks want to buy a Tesla right now. It's very exciting for us."

However, with all the pent-up demand, there remains supply chain concerns and production constraints. According to Kirkhorn, "we are putting an extreme effort to build as many cars as we possibly can. It's hard to overstate how extreme the efforts are. It's quite the grind. We're trying as hard as we can to maximize that capacity and to be able to meet the demand that we're receiving. But the net-net of all of this is that we're not able to increase production capacity fast enough."

"Our backlogs are continuing to grow and average customer wait times are extending," notes Kirkhorn. He added that if someone orders a Tesla, the wait time "could be a couple of months, [or it] could be a couple of quarters."

So how can Tesla take advantage of all this demand? In short, the company has to quickly ramp production at Tesla's new Gigafactories in Texas and Germany. According to Kirkhorn, "it remains our target in both Austin and Berlin to be able to build our first production cars before the end of the year... [and] it's possible that we're spending the bulk of next year working on ramping these factories."

Big picture — what's the forecast ahead? According to Kirkhorn, "Our goal is to get to millions of cars per year over the next couple of years and then ultimately, in the long term, be able to achieve 20 million cars per year. We're going to grow as quickly as is feasibly possible with an eye toward a 50% annual growth rate."


Source: Tesla

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Posted in Electric Vehicles, Tesla, Tesla Model Y, tesla news, TSLA



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