EnergyWatch

Growing EV interest ensures major Q3 profit for Tesla

Electric car maker Tesla expects to deliver 500,000 vehicles to customers during 2020.

Photo: ROBYN BECK/AFP / AFP

Tesla's profit in the third quarter – July, August, September – is more than double that of the same period last year, according to the electric vehicle manufacturer's interim report published on Wednesday.

Profit has surged to USD 331 million, up from USD 143 million the year prior. It's the fifth consecutive quarter in which the US EV giant books a profit.

Tesla has also seen a major rise in revenue during Q3, up by nearly 40 percent. One cause is, according to the firm, "growing interest in our cars."

Tesla maintains its guidance for delivery of 500,000 vehicles in 2020. In the previous quarter, the company delivered 139,000 cars, which is a record so far. During that period, increasing interest was noted in the EV maker's cheapest vehicle, Model 3.

The goal of delivering 500,000 cars in 2020 has "become more difficult" to achieve, Tesla writes.

To meet the target, the company must deliver more than 180,000 vehicles before the end of the year.

The group also states it has sufficient liquidity to carry out its product plans in the coming years.

Tesla's share price has surged by more than 400 percent in 2020.

The car maker's founder and chief executive, Elon Musk, said in September that Tesla's cars will become cheaper in the future.

By lowering production costs, the cars must attain a different price level from the current one. But it might be three or more years before that goal is reached, Musk said.

Crucial to bringing prices down is the development of a new type of batteries, which will be more powerful, have longer lives and, according to Musk, come at half the price of the firm's current batteries.

While EV prices have dropped in recent years due to improvements to batteries, it's still more expensive to buy an electric rather than a conventional car.

The battery is estimated to make up between a third and a fourth of the expenses tied to an electric vehicle.

English Edit: Jonas Sahl Jørgensen

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