Electric car specialist Tesla has continued its profit streak for the third quarter-year in a row – albeit by a slim margin, and largely due to selling carbon emissions credits to rival automotive companies to help them meet stricter regulations.
Despite pausing production at its factories in the US and China – as most of the automotive industry has done during the global pandemic – Tesla posted a net profit of $US16 million after earning $US354 million from selling regulatory credits to rival car companies.
The profit of $US16 million was from a total turnover of $US5.1 billion in Tesla’s automotive business for the quarter.
The revenue of $US354 million from regulatory credits was a 64 per cent increase from the same period last year and a 166 per cent increase from the previous quarter, Automotive News USA reported.
Because of the market uncertainty caused by the coronavirus crisis, Tesla declined to speculate if it would be profitable next quarter, however it is about to ramp up production of its latest addition, the Tesla Model Y compact SUV (pictured above).
Tesla’s profit result comes as US car giant Ford posted a $US2 billion loss for the first quarter of this year and forecast a $US5 billion loss for this quarter due to the dramatic drop in demand for new vehicles globally.
Car factories in Europe, China and the US are ramping up production – or about to restart their assembly lines – however experts are yet to forecast when the industry will return to full capacity.
Tesla declined to disclose exactly how many cars it has sold so far this year and repeated its earlier forecast of selling 500,000 vehicles globally by the end of the 2020 calendar year.
Industry analysts in the US say sales of new vehicles dropped by as much as 80 per cent in some parts of the country; dealers in Australia say they have noticed a slight upswing in demand in the past fortnight, though still a long way from the pre-lockdown sales levels.