Photo: The Wall Street Journal
Tesla's growth story is misunderstood, says Loup Fund. Looking at the numbers, Tesla's growth and competitive advantage appear to be increasing, Gene Munster wrote in a note to customers.
Gene Munster, Managing Partner of Loup Fund, wrote a note to clients claiming Tesla's growth story is misunderstood. While Tesla's Q2 delivery growth of 27% was in line with expectations, it was a step down from the company's 68% delivery growth in Q1 of 2022, he wrote. However, this is misunderstood by the market. Munster offers to delve into the numbers, which actually show that Tesla's growth and competitive advantage are increasing.
Prior to the lockdown at the end of March, Tesla was producing between 60,000 and 70,000 vehicles a month in China, according to the China Passenger Car Association (CPCA). The CPCA estimates that the company produced about 11,000 vehicles in April and 34,000 in May, for a total of 45,000 vehicles during the shutdown. Under normal circumstances, that is, if Giga Shanghai had not been closed, Tesla would have produced 130,000 vehicles in those two months. In particular, the 22-day shutdown slowed production by about 85,000 units, Munster notes. Assuming all production losses in China were converted into deliveries, which he believes is a fair assumption, total deliveries in June would reach 340,000 units, up 69% from last year and largely in line with growth deliveries by 68% in Q1.
Thus, the conclusion that Tesla leads the legacy automakers is an obvious one. Tesla's adjusted delivery growth of 69% shows the manufacturer continues to outpace the US auto industry. Loup Fund looked at the production figures of eight other car companies and found that their deliveries to the US were down 22% from last year. Comparing Tesla's global deliveries to other US OEMs may be flawed, but the data does illustrate the magnitude of this supply gap.
The Loup Fund concluded that, in effect, Tesla outperformed other automakers by 91% in Q2 2022, compared to 75% in Q1 2022 and 90% in Q4 2021.
Source: Loup Fund
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