Home » Can Tesla’s 2022 goal of maximizing capacity expansion and landing L4 fully autonomous driving be achieved? _Automotive_Software_Capability

Can Tesla’s 2022 goal of maximizing capacity expansion and landing L4 fully autonomous driving be achieved? _Automotive_Software_Capability

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Original title: Can Tesla’s 2022 goal of maximizing capacity expansion and landing L4 fully autonomous driving be achieved?

Collecting news from Weibo, Tesla announced its fourth quarter and full-year financial results for 2021. In the fourth quarter of 2021, Tesla’s total revenue was $17.7 billion, a year-on-year increase of 65%, and GAAP net profit reached a record high of $2.3 billion. Among them, the automobile business revenue was 15.9 billion US dollars, a year-on-year increase of 71%, and the gross profit margin of the automobile business was as high as 30.6%.

Tesla noted in its earnings call that 2021 is a breakthrough year with proven viability and profitability of electric vehicles. But Tesla also warned that supply chain constraints could weigh on its performance “through 2022.” Its factories “have been operating below capacity for several consecutive quarters” affected by global supply chains, transportation, labor and other manufacturing, with the supply chain a major constraint.

Elon Musk expressed at the earnings conference that Tesla’s goal for this year will focus on increasing production capacity, and implementing L4-level fully autonomous driving is also a small goal this year. He even said, “If we do not achieve fully autonomous driving this year, I would be very shocked.”

Musk emphasized at the earnings conference that Tesla will not launch new models this year, but products such as electric pickups, Roadster sports cars and Optimus robots are constantly optimizing engineering design. Tesla is now focusing on the Texas Gigafactory and the Berlin Gigafactory. This year, the focus is to continue to expand car production, with the goal of increasing annual deliveries by 50% in the next few years.

In terms of specific plans to increase production capacity, Tesla said that it will not only increase production through new factories in Austin and Berlin, but also maximize production in existing factories in Fremont and Shanghai. Tesla believes that the competitiveness of the electric vehicle market will depend on the increase in the entire supply chain and production capacity.

The financial report shows that Tesla’s full-year 2021 revenue is $53.8 billion, a year-on-year increase of 71%, and GAAP net income will reach $5.5 billion. Among them, the automobile revenue was 47.2 billion US dollars, a year-on-year increase of 73%, and the automobile gross profit margin was as high as 29.3%. Tesla spent $6.5 billion last year on new factories and other capital expenditures.

At present, the Model Y model has been put into production at the Texas Gigafactory at the end of 2021, and will begin to be delivered to customers after the final certification is completed. The Fremont plant will achieve record production in 2021, with an annual production capacity of over 600,000 vehicles, including 100,000 Model S/X models and 500,000 Model 3/Y models. With an annual output of over 450,000 vehicles, the Shanghai Gigafactory remains Tesla’s main export center. Tesla said localized production is critical to reducing per-vehicle costs and improving production efficiency. The Berlin plant has started testing the manufacturing equipment at the end of 2021, but is still in the process of obtaining a manufacturing license from local authorities. The first cars will continue to use 2170 batteries.

Tesla Chief Financial Officer Zach Kirkhorn also expressed in the earnings conference that global supply chain constraints and chip shortages are the main factors that constrain Tesla to further expand investment. This may also be an uncertain factor in Tesla’s expansion of car production this year.

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Recently, luxury car brands including Bentley and Lamborghini have successively announced their entry into the electric vehicle market, making this track cover almost all levels of car brands, which will further increase the demand for chips in the automotive industry.

Tesla is a representative of the vertically integrated production model. Its core components are produced by itself, but it is still affected by the lack of cores. It also proves that in the process of the transformation of the new four modernizations of automobiles, the most important thing for various car companies is to ensure the automobile supply chain. stability, especially the supply of automotive chips.

In the long run, the manufacture of electric vehicles will not ultimately give car companies higher added value, because the number of components assembled is much less than that of fuel vehicles, and some chip manufacturers consciously begin to provide modules for car companies. Cooperation, in the future, the difficulty of vehicle manufacturing may be much lower than that of fuel vehicles. So, where is the real high added value?

The answer lies in software-based digital services, including autonomous driving, in-car entertainment, high-precision navigation, and more. On the whole, ensuring the stability of the supply chain, especially the supply of automotive chips, is the foundation of Tesla’s current sustainable development, and in the long run, FSD and related software ecosystems are the real growth space for Tesla.

The future: software-based digital services

PricewaterhouseCoopers pointed out in the report that in the next few years, the automotive industry, products and related services will usher in major changes with the substantial increase in demand for smart and connected functions. Software, in particular, has become the core of modern vehicle differentiation, and the cost of software development will increase by 83 percent over the next decade.

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Jin Jun, a partner in charge of the China auto industry at PwC, previously said that software has become the core of differentiated competition in modern vehicles, and the cost of software development will nearly double, and the shift from hardware to software is expected. In the future, only by focusing on building software-driven car companies can they continue to capture value in a complex and volatile market.

Tesla highlighted in its earnings report that FSD (Fully Self-Driving) software remains one of the main areas of focus. Over time, Tesla’s software-related profits will accelerate the overall profitability. What’s more, FSD is a key component in improving vehicle safety and further accelerating the world‘s transition to sustainable energy by increasing vehicle utilization.

The Tesla team is continuing to iterate on the FSD Beta, releasing a total of 7 updates in the fourth quarter of last year, and also successfully increasing the number of FSD Beta tests in the US from a few thousand in the third quarter to nearly 60,000 currently. Musk said that it is not a very high standard for autonomous driving to eventually reach the level of human drivers, and it does not even need to use the DOJO supercomputing. In the next few months, there will be some significant improvements to the FSD system. Musk is also confident that fully autonomous driving will be achieved this year.

Zach Kirkhorn’s remarks at the earnings conference also confirmed the importance of software in the future car competition, “Tesla software business is the main focus for improving profit margins because they are very high. When FSD and When Robotaxi finally becomes a reality, Tesla’s profit margins will be significantly improved,” he said.

According to PwC estimates, the software development cost of each model in the future may be upgraded from 181 million euros to 331 million euros due to the continuous upgrade of AD/ADAS. In the past 10 years, the main reason for the huge changes in vehicle development costs is that the backbone of consumption has undergone a major shift – from the 50s to 70s, when the car was mainly used as a means of transportation, it has become an obvious digital experience. The in-demand Gen Y crowd.

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The author believes that under the software-defined car, the potential of digital services is gradually being amplified. Through the OTA and hardware pre-embedded model, the car is not only a means of transportation, but also a huge platform for carrying digital information exchange. In the future, car manufacturing will no longer be the focus of car companies’ competition, and its added value will be reduced, while digital services are Key points to provide high added value and great profits.

Richard Windsor, research director at Counterpoint, said the auto industry could face a doubling of chip content per vehicle over the next two decades. This is underlined because Counterpoint predicts that the most extreme scenario over the next two decades will be a 65% drop in global vehicle demand.

The logic behind this is that an important competitive advantage of electric vehicles is that they can travel longer distances before being scrapped. According to predictions made by Tesla and Counterpoint, after driving about 500,000 miles, the battery performance drops to 20%, which is Meaning, consumers don’t need to change cars so frequently. As such, the cost of buying and maintaining a car has dropped significantly.

With the development of automobile “four modernizations” and autonomous driving, the overall demand for automobiles in the future will show a significant downward trend. By 2047, the number of automobiles will be reduced to 44 million. By then, autonomous vehicles will cover almost the entire market. Digital services for cars will be a huge business opportunity once electrification and automation really begins and vehicles are fully digitized. Counterpoint predicts that spending on automotive digital services could reach as much as $1.6 trillion by 2024.

From a certain point of view, the development trajectory of automobiles is similar to that of mobile phones. When Apple, the top giant in the mobile phone industry, began to focus on the digital service business in the past two years and wanted to get rid of the name of “iPhone company”, the focus of mobile phone competition was no longer on the manufacture of mobile phones. , but what kind of experience this phone can bring to the user.

Cars too, Tesla too, but it’s just getting started.

(Proofreading/Sharon)Return to Sohu, see more

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