The future is looking mighty bright for Tesla Motors.
The upstart car company saw the sale of 22,477 cars last year, with a record 6,892 vehicles sold in the fourth quarter alone, according to Tesla’s letter to shareholders released today. Compared to some of the other auto manufacturers, this might seem meager, but Tesla Motors isn’t your typical car company — and I’m not simply referring to its vehicles being electric, either.
Unlike other auto makers, Tesla insists on selling its cars directly to consumers. You walk into a Tesla store — much like you would an Apple Store — to sample the products and order a custom version of their car. However, many state laws prohibit such direct transactions, instead requiring that licensed car dealer sell automobiles. So if I wanted to purchase a Model S in Texas, I’d have to order it from the company’s website from my home. That vehicle would technically have to then be driven/delivered from California to my residence. This makes the logistics of selling the car much harder, not only because of the inconvenience but also the cost of having it delivered individually as people purchase them.
But those setbacks don’t seem to have slowed Tesla’s growth, as today’s earnings show. Quite the contrary, actually. Tesla is predicting an even brighter 2014.
Not only is the company making production plans for its new Model X vehicle, it’s also giving new Model S owners data connectivity and access to streaming music services free of charge for four years. Additionally, Tesla is scheduled to complete its construction of electric battery charging stations (also free of charge), making it possible for people to easily make cross-country voyages without running out of juice. When you combine all of that with the attractive financing offer introduced back in April (not to mention various eco-related tax breaks), it seems likely that Tesla will enjoy greater sales domestically.
Yet the biggest factor that could push Tesla car sales forward in 2014 is its impending international expansion. Tesla has already made a big push in China and Germany, but it plans to gradually expand with new dealerships in the U.K., Japan, Hong Kong, and Australia starting this spring. The company said it expects sales in the European and Asian regions to more than double its domestic car sales by end of 2014.
Tesla said it expects to sell 55 percent more vehicles (over 35,000 Model S cars) and increase production from 600 to 1,000 cars per week by the end of 2014. As for Q1, Tesla’s guidance puts car sales at a modest 6,400 while producing about 7,400 to support its European expansion.
The company declined to share any new developments about its Gigafactory battery production facility (which will help Tesla cut battery costs and speed up battery innovation), but did indicate that it will make an announcement in the near future.
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