Tesla (TSLA) Chief Executive Elon Musk sometimes makes promises he can't deliver or perhaps that he never intends to deliver.
He's a brash man who clearly thinks a lot of himself but also someone who seems to have fun keeping other people on their toes.
Will there be a Cybertruck in 2023? Will Tesla release a flying taxi? A drone? A robot? Musk has mentioned some of those things, and whether they will ever actually exist remains a large question.
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Amidst all the bravado, however, Tesla has delivered. The company may not deliver on every promise its CEO makes, but it has delivered a lot of cars (at least by electric-vehicle standards.
The EV leader delivered roughly 1 million cars in 2021 and its plans for 2022 should worry the would-be upstarts in the space, Lucid Motors (LCID), Rivian Automotive (RIVN), and Nio (NIO).
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What Does Tesla Plan for 2022?
Tesla won't introduce any new models in 2022. That may disappoint its fans, who seem to like the company's constant innovation, but it should terrify Lucid, Rivian and Lucid.
That's because Musk has plans for the new year and they're not about innovating; they're about dominating. He spoke about it during the company's fourth-quarter earnings call.
I think it is worth noting that we -- and as the internet has observed, we've been making quite a few cars in Texas and Berlin, so -- in Austin and Berlin. So in Texas, we're building the Model Ys with the structural battery pack and the 4680 cells, and we'll start delivering after final certification of the vehicle, which should be fairly soon. Capacity expansion will continue through maximizing output of each factory and building new factories and new locations in the future. Although we're not ready to announce any new locations on this call, but we will get through 2022 look at new locations, and probably be able to announce new locations toward the end of this year, I expect.
Tesla has a massive lead in production over its rivals and it plans to devote the next year to extending that lead. Musk expects to make significant progress over the next 11 months or so.
"We do expect significant growth in 2022 over 2021, you know, comfortably above 50% growth in 2022," he said.
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Growing capacity was a recurring theme for Tesla's CEO who came back to it later in the call.
The fundamental focus of Tesla this year is scaling output. So both last year and this year, if we were to introduce new vehicles, our total vehicle output would decrease. This is a very important point that I think people do not -- a lot of people do not understand. So last year, we spent a lot of engineering and management resources solving supply chain issues, rewriting code, changing our chips, reducing the number of chips we need, with chip drama central.
And there were not -- that was not the only supply chain issue, so -- just hundreds of things. And as a result, we were able to grow almost 90% while at least almost every other manufacturer contracted last year. So that's a good result. But if we had introduced, say, a new car last year, we would -- our total vehicle output would have been the same because of the constraints -- the chips constraints, particularly.
Musk might be prone to bravado and making trolling comments, but he also fully understands his business. The statement above shows that 2022 won't be a year in which the company changes the world with a new idea, Instead, it will be one where Tesla focuses on building its lead over its rivals.
How Far Ahead of Nio, Rivian and Lucid Is Tesla?
Tesla came in at 1 million vehicles delivered last year and it's not unreasonable to expect that to at least double in 2022. Nio, Lucid, and Rivian remain absurdly behind:
- Lucid delivered dozens, not even hundreds of vehicles in 2021. The company expects to hit half a million vehicles by 2030.
- Nio hit 9.652 cars delivered in January. That's an improvement over the previous quarter where it averaged about 8,000 per month.
- Rivian delivered less than 1,000 vehicles in 2021. The company has a second factory being built that will be completed in 2024. That facility will have a capacity of 400,000 cars per year.
Tesla has a big lead and Musk wants to increase that. But, of course, the CEO can't help himself, and he promised to develop an innovation that's not a vehicle, which he expects to help the company ramp up its production even more.
"I think actually the most important product development we're doing this year is actually the Optimus humanoid robot," he said. "This, I think, has the potential to be more significant than the vehicle business over time."
Why would building a robot help Tesla produce more cars? Musk explained.
"If you think about the economy, it is -- the foundation of the economy is labor," he said. "Capital equipment is distilled labor. So what happens if you don't actually have a labor shortage? I'm not sure what an economy even means at that point. That's what Optimus is about, so very important."
