TeslaLong
Tesla 2023 Review and Outlook
Updated
2023 Review
In 2023, Tesla delivered over 1.2 million Model Y’s establishing it as the best-selling vehicle globally, regardless of type, signaling a remarkable shift in the automotive landscape. Despite initial skepticism about the viability of electric vehicles (EVs), this success has proven otherwise.
Maintaining a robust free cash flow of $4.4 billion throughout 2023, they strategically directed significant resources towards future growth projects, resulting in record-high capital expenditures and research and development (R&D) expenses. They remain committed to innovation and expansion.
Energy storage deployments soared to 14.7 gigawatt-hours (GWh) in 2023, more than doubling the previous year's figures. Simultaneously, Energy Generation and Storage business witnessed a nearly fourfold increase in profits. The Services & Other business also experienced a substantial transformation, turning a $500 million loss in 2019 into a $500 million profit by 2023.
In the final quarter, the cost of goods sold per vehicle exhibited a sequential decline, a testament to the company's dedication to enhancing efficiency. Looking ahead to 2024, Tesla’s focus remains on scaling production, investing in future growth, and uncovering additional cost-saving measures.
In a groundbreaking development, December saw the rollout of Version 12 of Full Self-Driving Beta, a system trained on data from a vast fleet of over a million vehicles. This advanced AI-driven system influences various vehicle controls, such as steering wheel, pedals, and indicators, without relying on hard-coded driving behaviors. V12 signifies a significant leap forward in the journey toward achieving full autonomy.
The company’s sights are set on introducing the next generation platform expeditiously, with plans to commence production at Gigafactory Texas. This revolutionary platform is poised to redefine the manufacturing process for vehicles, ushering in a new era of automotive innovation.
Outlook
Volume: The company currently finds itself between two substantial growth phases. The first wave commenced with the global expansion of the Model 3/Y platform, and they anticipate the next surge to be triggered by the worldwide expansion of the next-generation vehicle platform. In 2024, the growth rate of their vehicle volume may experience a notable decrease compared to 2023, primarily due to the focus of the company on the launch of the next-generation vehicle at Gigafactory Texas. During this period, the growth rate of deployments and revenue in the Energy Storage business will surpass that of the Automotive business they announced
Cash: They maintain ample liquidity to support the product roadmap, long-term capacity expansion plans, and other financial obligations.
Profit: The company persists in implementing innovations to reduce manufacturing and operational costs, while foreseeing a shift in the profit landscape. Over time, they anticipate that profits from hardware-related aspects will be complemented by an acceleration in AI, software, and fleet-based profits.
Product: The ramp-up of Cybertruck production and deliveries is slated to progress steadily throughout the year. Concurrently, they continue to make significant strides in the development of our next-generation platform.
In 2023, Tesla delivered over 1.2 million Model Y’s establishing it as the best-selling vehicle globally, regardless of type, signaling a remarkable shift in the automotive landscape. Despite initial skepticism about the viability of electric vehicles (EVs), this success has proven otherwise.
Maintaining a robust free cash flow of $4.4 billion throughout 2023, they strategically directed significant resources towards future growth projects, resulting in record-high capital expenditures and research and development (R&D) expenses. They remain committed to innovation and expansion.
Energy storage deployments soared to 14.7 gigawatt-hours (GWh) in 2023, more than doubling the previous year's figures. Simultaneously, Energy Generation and Storage business witnessed a nearly fourfold increase in profits. The Services & Other business also experienced a substantial transformation, turning a $500 million loss in 2019 into a $500 million profit by 2023.
In the final quarter, the cost of goods sold per vehicle exhibited a sequential decline, a testament to the company's dedication to enhancing efficiency. Looking ahead to 2024, Tesla’s focus remains on scaling production, investing in future growth, and uncovering additional cost-saving measures.
In a groundbreaking development, December saw the rollout of Version 12 of Full Self-Driving Beta, a system trained on data from a vast fleet of over a million vehicles. This advanced AI-driven system influences various vehicle controls, such as steering wheel, pedals, and indicators, without relying on hard-coded driving behaviors. V12 signifies a significant leap forward in the journey toward achieving full autonomy.
The company’s sights are set on introducing the next generation platform expeditiously, with plans to commence production at Gigafactory Texas. This revolutionary platform is poised to redefine the manufacturing process for vehicles, ushering in a new era of automotive innovation.
Outlook
Volume: The company currently finds itself between two substantial growth phases. The first wave commenced with the global expansion of the Model 3/Y platform, and they anticipate the next surge to be triggered by the worldwide expansion of the next-generation vehicle platform. In 2024, the growth rate of their vehicle volume may experience a notable decrease compared to 2023, primarily due to the focus of the company on the launch of the next-generation vehicle at Gigafactory Texas. During this period, the growth rate of deployments and revenue in the Energy Storage business will surpass that of the Automotive business they announced
Cash: They maintain ample liquidity to support the product roadmap, long-term capacity expansion plans, and other financial obligations.
Profit: The company persists in implementing innovations to reduce manufacturing and operational costs, while foreseeing a shift in the profit landscape. Over time, they anticipate that profits from hardware-related aspects will be complemented by an acceleration in AI, software, and fleet-based profits.
Product: The ramp-up of Cybertruck production and deliveries is slated to progress steadily throughout the year. Concurrently, they continue to make significant strides in the development of our next-generation platform.
Note
Key metrics quarterly:Note
Note
During the fourth quarter, they rolled out the latest Full Self-Driving (FSD) Beta software, version 12, initially to Tesla employees and subsequently to customers. V12 employs end-to-end training, significantly elevating the driving experience. Additionally, they unveiled the second generation of the Optimus robot, featuring Tesla-designed actuators and sensors along with enhanced AI capabilities. Both FSD Beta and Optimus undergo training using comparable technology foundations, including real-world data, neural network training, and state-of-the-art hardware and software.
Note
The per-vehicle cost of goods sold saw a sequential decline, settling just above $36,000. Despite nearing the inherent limits of cost reduction for their current vehicle lineup, they announced that the team remains dedicated to achieving further cost efficiencies across all stages of production, spanning from raw materials to the final delivery process.Note
In the fourth quarter, energy storage deployments experienced a sequential decrease to 3.2 GWh, contributing to a total deployment of 14.7 GWh in 2023—an impressive 125% increase compared to 2022. Anticipating continued volatility in sequential deployments due to logistical factors and the global distribution of projects, they project sustained growth on a trailing twelve-month basis in the future.
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