Source: Tesla
Tesla shares roared in after market trade on Wednesday in the US (Thursday, Australia time), leaping nearly 12 per cent and adding $US13 billiion ($A20 billion) in value after the electric car market delivered another quarterly profit and gave an upbeat view of the coming year.
Tesla stok had already surged in recent weeks, trebling its price from recent lows in May, overtaking the combined value of legacy car making giants Ford and GM, and also leaping above $US100 billion in market cap.
On Wednesday, the stock closed at $US581 a share, but in two major surges in after market trade leaped to $US647 a share. The company delivered a small quarterly profit of $US105 million, but it was the stability and the cash flow and the outlook that counted most for investors.
“2019 was a turning point for Tesla,” the company said. “We demonstrated strong organic demand for Model 3, returned to GAAP profitability in 2H19 and generated $US 1.1 billion of free cash flow for the year. We achieved strong cash generation through persistent cost control across the business.”
The key was obviously the “strong organic demand” for the company’s Model 3 “mass-market” electric sedan, for which Tesla has not spent a dollar on paid advertising but delivered a total of 300,000 units in 2019 in domestic and overseas markets.
“For most of 2019, nearly all orders came from new buyers that did not hold a prior reservation, demonstrating significant reach beyond those who showed early interest,” it said.
“Amazingly, this was accomplished without any spend on advertising. As more people drive our cars and as the industry rapidly validates electrification, interest in our products will continue to grow.”
The coming year is equally prospective. First deliveries of the Model Y electric crossover have now been confirmed to commence by the end of March 2020, with a “gradual” ramp up of production already underway at the company’s Fremont Gigafactory.
To read the full story on RenewEconomy’s electric vehicle dedicated site, The Driven, click here…
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