Tesla posts record profit

Tesla has hit a new high, posting its fifth profitable quarter in a row with the release today of its third-quarter results for 2020.

The $US8.77 billion ($A12.35bn) revenue Tesla generated in the third quarter was a record for the electric vehicle manufacturer and puts the company on track to have a profitable calendar year for the first time since it was established in 2003. The profit Tesla recorded for the quarter was $US874 million (on an adjusted basis).

Tesla says it now intends to finish the year by delivering a record 500,000 vehicles, despite having to close its huge Fremont plant during the height of the COVID-19 pandemic.

The latest financial result is another triumph for Tesla CEO Elon Musk, who runs the world’s most valuable car company based on a market capitalisation that rose even further after the results were posted to nearly $US400 billion ($A564bn).

He certainly benefited from the results as well, creaming off more than $US540 million ($A761m) in stock-based compensation to leave the final net income result at $US331 million ($A467m).

The record net income figure was bolstered by the sale of $US397 million ($A560m) in regulatory credits to rival manufacturers who were unable to meet emissions levels in the US and Europe.

Without the credits Tesla would not have posted a profit. Some analysts regard that as a black mark against the company, others consider it a bona fide part of the business model.

Either way, there’s no doubt the sky-high valuation of Tesla continues to be a raging source of debate because other car companies boast far higher sales, revenues and profits.

“The company is still valued incredibly richly, like it’s operating in a vacuum, yet competitors are working furiously to catch up,” Craig Irwin, an analyst with Roth Capital Partners, told Reuters.

More than 400 new electric vehicle models are scheduled to hit the roads by 2024, Reuters estimated.

To achieve 500,000 sales by December 31, Tesla will have to sell a record 181,000 vehicles in Q4. It built a record 145,000 in Q3.

It says increased production at its new Shanghai plant and higher output of the increasingly popular Model Y SUV will be critical to achieving the milestone number.

But during an investor call Musk was already talking about one million sales within a couple of years.

That seems feasible considering the Berlin and Texas Gigafactories are due to go into production soon, increasing availability of the popular Model Y and Model 3.

The Tesla Semi is launched in 2021, and the Cybertruck, for which many thousands of orders have been received, is due to start rolling out at the end of 2021.

Of course, further out Musk is promising a $US25,000 ($A35,000) EV on the back of new tech and manufacturing methods outlined at the Tesla battery day in September.

During the same presentation he predicted Tesla would eventually sell 20 million vehicles annually, or more than a fifth of the current global market.

Recently Tesla has cut the price of both the Model 3 and Model S.

It is also approaching 10,000 sales in Australia.