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Tesla won't roll out new models in 2022 because of chip shortages

MoneyWatch: Chip shortage concerns
MoneyWatch: Semiconductor chip shortage could raise national security risks 04:59

Consumers awaiting the arrival of the Tesla Cybertruck will have to wait at least another year for their wheels. 

Although the company predicted it would be able to build 50% more vehicles than it made last year, Tesla CEO Elon Musk said Wednesday the global chip shortage would stop the company from rolling out any new models in 2022. That means another delay for the Cybertruck pickup, which was originally scheduled to go on sale last year.

Musk also said Tesla isn't yet working on a promised $25,000 small electric car — but it will eventually. "We have enough on our plate right now, quite frankly," he said during an earnings call with analysts.

And Musk said the company is looking at building additional factories and will offer an update on locations later in the year.

Tesla on Wednesday posted record fourth-quarter and full-year earnings as deliveries of its electric vehicles soared despite a worldwide shortage of computer chips that has slowed the entire auto industry and other manufacturers of consumer goods.

Commerce Secretary Gina Raimondo issued a dire warning for Congress on semiconductor chips Tuesday, as the Commerce Department released results from its survey on the semiconductor supply chain that show chips are in short supply as demand booms.

Unquestionable demand for electric vehicles

Tesla made $5.5 billion last year compared with its previous record of nearly $3.5 billion in net income posted in 2020. Musk said Wednesday the latest annual profit number pushed the company's accumulated earnings since its 2003 inception into profitable territory.

Musk and othher Tesla executives cited last year was a breakthrough year for the Austin, Texas, company: "There should no longer be doubt about the viability and profitability of electric vehicles," Tesla said in a letter to shareholders.

Analysts at Wedbush Securities agree. "Taking a step back, with the chip shortage still a major overhang on the auto space and logistical issues globally, these delivery numbers combined with this 'impressive earnings beat' speaks to an EV demand trajectory that looks quite robust for Tesla with clear momentum heading into 2022," Daniel Ives and John Katsingris said in a research note. 

Global shortage of semiconductors devastates U.S. auto industry and its workers 06:18

Musk said factory output was constrained last year as the company focused resources on modifying vehicles and manufacturing to deal with scarce chips and other supply chain problems that will persist this year. Engineering work and factory tooling are underway to produce the delayed Cybertruck, Semi and a new Roadster, which he said he now hopes to be ready for production next year.

If Tesla were to start building new vehicles this year, fewer vehicles would be delivered to customers because company attention and resources would be diverted to the new model, he said.

Tesla said it started building Model Y SUVs late last year at its new factory near Austin with more advanced battery cells. After final certification, it plans to start delivering them to customers. The company also said it's testing equipment at its new factory in Germany, and is still trying to get a manufacturing permit from local authorities.

The company said that its "Full Self-Driving" software is now being tested on public roads by owners in nearly 60,000 vehicles in the U.S. It was only about 2,000 in the third quarter. The software, which costs $12,000 and cannot yet power a vehicle to drive itself, should accelerate Tesla's profitability, the company said.

Musk said he'd be shocked if the software can't drive more safely than humans this year, although he dodged a question about whether the vehicles would reach full autonomy in 2022. Currently, Tesla says "Full Self-Driving" is a driver-assist system and drivers must be ready to intervene at all times.

U.S. safety regulators are looking into a complaint about the safety of "Full Self-Driving," and they also are investigating why Teslas operating on a less sophisticated partially automated system called "Autopilot" have repeatedly crashed into parked emergency vehicles.

Musk paid $245 million in last quarter

In the fourth quarter, Tesla made $2.32 billion. Excluding special items such as stock-based compensation, the company made $2.54 per share. That beat Wall Street expectations of $2.36 per share. Revenue for the quarter was $17.72 billion, also ahead of analysts' estimates of $17.13 billion, according to FactSet.

Tesla delivered a record 936,000 vehicles last year, nearly double the 2020 figure. Fourth-quarter vehicle sales hit 308,600, also a record. Tesla said it expects 50% annual growth in vehicle deliveries "over a multi-year horizon."

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It also said Musk was awarded $245 million in the fourth quarter because he reached some operational milestones in his stock-dominated compensation package.

The company said it was able to drive cost reductions in the final quarter of the year, as well as grow vehicle sales. But Chief Financial Officer Zachary Kirkhorn cautioned that starting up the Austin and Berlin factories, plus pressure from commodity price increases and supply chain costs, will add to Tesla's costs this year.

Tesla's shares initially tumbled nearly 5% on news of the production delays. The stock was down 7% Thursday, hovering around $871.

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