Tesla released its financial results for the third quarter of 2020 on Wednesday. It says that it ended in the third quarter of 2020 with a GAAP profit of $331 million, the 5th consecutive profitable quarter for the American car manufacturer. Despite the pandemic, it was significantly improved in Q3 2019.
With a positive free cash flow of $1.4 billion and $14.5 billion in cash and cash equivalents, Tesla ended Q3 2020. Tesla tells investors in their presentation that Q3 was marked by significant growth in vehicle delivery which counteracted a decline in the average sales price, with the company selling less and fewer S and X models and selling more and more 3 and Y models. The company’s regulatory credits accounted for $397 million in revenues, and after reaching certain milestones the company had to pay $280 million in stock-based compensation to CEO Elon Musk.
Already in October, the automaker published data on its Q3 products but reiterated that it produced 16,992 models S and X, which delivered 15,725 products. The output of Models 3 and Y was 128,044; a total of 124,318 of these vehicles were delivered during the three months in question. Total deliveries were up 54% quarter-on-quarter and 44% year-on-year. The automotive business generated total revenue of $7.6 billion.
Tesla says it now increases the production capacity of Models 3 and Y at its factory in Fremont, California, to 500,000 vehicles a year, and expects it to be fully capable at the end of 2020 or beginning 2021. It says its plant in Shanghai, China is now operating with three shifts and its capacity has grown to 250,00 vehicles annually. The company says that in Berlin, Germany, the factory is underway and that equipment should start to arrive in “the coming weeks,” with production beginning next year.
Also in the third quarter of the year, Tesla’s battery storage company spent 759 MWh and increased 81 percent in comparison with Q2, 2020. It was even a good quarter for the company’s 57 MW solar operation, an increase of 111 percent in the second quarter. Tesla says this is due to a new low-cost solar panel strategy. In total, for the quarter, these two parts of Tesla’s company contributed $579 million in revenue.
The company now claims to be able to produce and deliver half a million electric cars by 2020, and this continues to be its goal. This would require the construction of 170,020 vehicles and the delivery for the last three months of the year of 181,020 vehicles. Tesla says she will achieve this by increasing Model Y production and increasing her Chinese factory’s production.
Tesla states that it has enough liquidity to finance the development of Roadster and Cybertruck and that it is continuing to “signifitively invest in its product roadmap.” Accordingly, in fact, R&D expenditure has increased to its highest level of 366 million dollars over several quarters.