EV-maker Tesla surprises, again, with second-quarter profit

Elon Musk has pulled another rabbit out of a hat, surprising the market yet again on Wednesday with better-than-expected earnings from his electric car maker, Tesla Motors, which pushed up the company’s stock by as much as 14 per cent in after-hours trade.

In May, Musk delivered a surprise quarterly profit – the company’s first – that stunned investors, who had been anticipating another loss. The unexpected good news sent shares on a steep climb that has since led to a year-to-date gain of more than 300 per cent.

Despite this May result, and some targeted social media hype from Musk, analysts were expecting Tesla to take a hit this time around. Instead, the company recorded second-quarter earnings of 20 cents per share, and – while stressing that profits were not the company’s primary goal – a 70 per cent growth in net income from the first quarter to $US26 million, from $US405 million in revenue.

As Morgan Stanley put it in a briefing note to clients late on Wednesday, Tesla’s Q2 results surpassed “already high” expectations “that continue to rise nearly as fast as the share price.” Others remain wary, however, noting that so far, the company’s profits have relied on government subsidies and initiatives.

But, as Forbes reports, there was good news elsewhere too, such as improved gross margin — up to 22 per cent, despite a reduction in zero emission vehicle credits — and record sales of the Tesla Model S, at 5,150 cars. The company also managed to ramp up production of the Model S during the quarter, surpassing its stated goal of 400 cars a week, and growing that figure to almost 500.

The company said on Wednesday it had sold a total of 10,500 Model S sedans in the first six months of 2013 and expected to reach an annualized rate of 40,000 by late 2014, as it expands into to Europe and Asia. Currently, in the US, Tesla reportedly holds 8.4 per cent of the luxury car market.

And there are plans to begin selling a new companion crossover model – the Model X – late next year, with volume production to begin in 2015. And Reuters reports that in an earnings call with analysts, Musk said a third model, a compact electric sedan known internally as Gen 3, due in 2016, would have a 200-mile range per charge – roughly double the current industry standard. Musk said the new sedan, which he described as “our high-volume affordable car,” would be priced from around $US35,000.

But Tesla is not the only good news story in the EV market at the moment. The all-electric Nissan Leaf, for example, was the 7th-best-selling new passenger vehicle in Norway in July, capturing 2.4 per cent of the whole market. In total, 268 Nissan Leafs were registered in July in Norway.

(As CleanTechnica reports, Tesla – whose Model S will be hitting the European market this month – has a “delivery event” slated for the Norwegian capital, Oslo, as well as Zurich, and Tilburg, with deliveries to Europe expected to be ramped up gradually after that.)

Also this week came the news that the price for the 2014 Chevy Volt had dropped by $5,000 – meaning Americans could now buy the hybrid EV for under $US30,000. This price cut, says Gas2, “brings the entry-level Chevy Volt down to just $34,995, and with the Federal tax credit available nationwide the price is really $27,495. In California, which adds another $2,500 in state incentives, the Volt’s starting price is just $24,995. And in Colorado, which throws $6,000 on top of the Feds $7,500, you can get an entry-level Chevy Volt for just $21,495.”

Chevy has also recently launched its Spark EV onto the US market, in limited release in California and Oregon. After federal and state tax incentives, the five door compact car goes for $19,995 in California, $17,795 in Oregon. It has been praised by Consumer Reports as a “fun, punchy, zippy fun little roundabout,” and offers the option of a special accessory to charge the vehicle in only 20 minutes.