Analysts say Tesla has been delivering, despite the pandemic
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The last seven months have been tough for a lot of businesses, including many automakers — but not for Tesla.
The electric vehicle maker just announced that it delivered 139,000 cars, a record number, in the third quarter, which analysts say bodes well for its quarterly earnings, scheduled to come out Wednesday.
“Tesla has done really well even despite the pandemic,” said Michelle Krebs of Autotrader.
One reason is that Tesla sells cars directly to consumers. Even before the pandemic, it was easy to buy a Tesla from home.
“You could order over the internet in the course of two to three minutes,” said Daniel Ives of Wedbush Securities.
So when many dealerships had to close for a while during the pandemic, it didn’t hurt Tesla the way it did other car makers.
The company has also been selling and delivering a lot of cars outside the U.S., in Europe, and particularly in China, where demand has “skyrocketed,” Ives said. “China has really been a linchpin to this Tesla success story over the last year.”
Sales have been rising in Europe, too, where there are a lot of government incentives for people to buy electric vehicles, but China’s economy — and car sales — have “really bounced back after the pandemic,” Krebs said. “And it is the biggest EV market in the world.”
Tesla has dominated the electric vehicle market for a while. But that could be changing, as demand for electric cars rises, and more traditional automakers — like Ford, Volkswagen and General Motors — make a bigger play to get into the market, according to analysts.
“The big challenge for Tesla is that they have a lot of competition coming,” Krebs said. “For the past 10 years, they haven’t had much in the way of competitors, and the few that have popped up, they have conquered. But there are more and more coming.”
COVID-19 Economy FAQs
What do I need to know about tax season this year?
Glad you asked! We have a whole separate FAQ section on that. Some quick hits: The deadline has been extended from April 15 to May 17 for individuals. Also, millions of people received unemployment benefits in 2020 — up to $10,200 of which will now be tax-free for those with an adjusted gross income of less than $150,000. And, for those who filed before the American Rescue Plan passed, simply put, you do not need to file an amended return at the moment. Find answers to the rest of your questions here.
How long will it be until the economy is back to normal?
It feels like things are getting better, more and more people getting vaccinated, more businesses opening, but we’re not entirely out of the woods. To illustrate: two recent pieces of news from the Centers for Disease Control. Item 1: The CDC is extending its tenant eviction moratorium to June 30. Item 2: The cruise industry didn’t get what it wanted — restrictions on sailing from U.S. ports will stay in place until November. Very different issues with different stakes, but both point to the fact that the CDC thinks we still have a ways to go before the pandemic is over, according to Dr. Philip Landrigan, who used to work at the CDC and now teaches at Boston College.
How are those COVID relief payments affecting consumers?
Payments started going out within days of President Joe Biden signing the American Rescue Plan, and that’s been a big shot in the arm for consumers, said John Leer at Morning Consult, which polls Americans every day. “Consumer confidence is really on a tear. They are growing more confident at a faster rate than they have following the prior two stimulus packages.” Leer said this time around the checks are bigger and they’re getting out faster. Now, rising confidence is likely to spark more consumer spending. But Lisa Rowan at Forbes Advisor said it’s not clear how much or how fast.
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