Tesla finished 2022 on a high note, helped by recent price cuts for its lineup of electric sedans and SUVs. The automaker’s full-year 2022 earnings statement, which was released at the end of the market on Wednesday, revealed that it delivered 405,278 electric vehicles in the fourth quarter, up from 343,830 in the previous quarter. This brings Tesla’s total deliveries in 2022 to 1.31 million cars, a record high for the brand and 40% year on year growth, but also just short of the company’s own goal of 1.4 million deliveries.
According to Tesla’s earnings report, the average sale price of its vehicles has “generally been on a downward trajectory for many years.” The automaker cut prices on its electric car lineup by up to 20% late last year, partly due to lower demand, but also to keep the Model 3 and Model Y under the $55,000 qualification cap for the $7,500 electric sedan federal tax credit included in last year’s Inflation Reduction Act.
Investors were not thrilled with the price reductions, but Elon Musk argued that more affordable Teslas are a good thing.
According to the automaker, the average price of a Tesla has been cut in half between 2017 and 2022 and will most likely continue to fall. This is partly due to price reductions, but it is also due to the less expensive Models 3 and Y now accounting for the majority of Tesla’s production and deliveries. In 2018, they accounted for slightly more than half of Tesla’s 254,530 sales; today, they account for roughly 95% of the 1.31 million Tesla vehicles sold in 2022.
Despite the falling average transaction price, Tesla said it improved its operating margins from a negative 14% to a positive 17% from 2017 to 2022, citing the same shift to lower-cost models as well as its investment in localised, more efficient factories. Tesla announced a new $3.6 billion investment in its Nevada Gigafactory earlier this week, adding two new factories to the facility: A 100GWh factory will produce enough battery cells for up to 1.5 million light duty electric vehicles per year. Meanwhile, Tesla’s full-electric commercial truck will be manufactured in a high-volume Semi factory.
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