American electric vehicle maker Tesla makes eight times the profit margin per car sold compared to Japanese manufacturer Toyota, according to a report by Nikkei Asia.
Tesla reported Q3 2022 net profit of US$3.29 billion (RM14.9 billion) while Toyota stated that it made a net profit of US$3.15 billion (RM14.3 billion) for the same period, Teslarati reported.
Toyota’s comparative lack of profitability per car sold was due to several scenarios which required unforeseen spending by the Japanese manufacturer, according to Teslarati. High operating costs sustained by Toyota were due to sharply rising electricity prices, along with increases in material costs which led to Toyota’s vastly increased spending in Q3 2022, thus reducing its operating profit to just over US$3 billion (RM13.6 billion).
In terms of profitability margins in China, Tesla saw gross margins of 39% and 29.4% for its Model 3 and Model Y EVs, respectively, while the American carmaker’s gross margin globally was 27.9% in the third quarter of 2022, which was the same as that of the preceding second quarter in the year.
Certainly, Tesla is on a much smaller scale when compared to Toyota, as the former reported 936,000 vehicle deliveries in 2021 while the latter reported 9.51 million vehicle deliveries last year (financial year ending March 2022; it sold almost 10.5 million vehicles between January and December 2021).
In terms of profit per vehicle sold in the third quarter, Tesla made US$9,570 (RM43,495) per vehicle, while Toyota made around US$1,200 (RM5,454) per vehicle, according to analysis by Nikkei Asia as reported by Teslarati.
“The biggest factor behind Tesla’s profit growth is sales volume, then price hikes and a rise in self-driving software sales,” SBI Securities analyst Koji Endo was reported as saying. Tesla has also been reducing costs from manufacturing with Giga Press die casting press machines that enabled a significant reduction in the number of parts, thus reducing production times and improving efficiency.
Inside EVs cites an example where a rear section of the Model Y frame was made of 70 individual pieces previously, and the use of the Giga Press had reduced that number to just one. The Giga Press machine had also enabled Tesla to eliminate around 300 robots from the production line for the assembly of said 70 parts; the machine will also be used in the manufacture of the upcoming Cybertruck.
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Meanwhile in Malaysia, easily 100%++ profit (exorbitant tax)…
Toyota fanbois will say they still outsold Tesla and so Elon must be shame for not selling as much. The same with P2 fanbois.
Average Tesla Prices goes up to $70k now,
But only make 8x nett profit?
If follow luxury car profiteering, this is abit too low profit.
Lexus is a Toyota division. Therefore you mean that Toyota’s profit must be seen even more critical? Good point!
Who cares of profit? Toyota combines performance, style and safety to meet and exceed the needs of women!
Toyota makes 8 times more reliable car per Tesla.
I wonder if there is a comparison between 2 EV manufacturers. EV production might benefit from tax incentives/exemptions in certain countries versus the standard production costs of ICE vehicles.
But.. Tesla’s build quality and reliability are totally different stories altogether. If a Chinese car manufacturer aims for the same level of corner-cutting and reliability as Tesla and uses the same materials, chances are they’d have a bigger margin than Tesla.
Furthernore, Toyota builds cars for all market segments from the thin-margin affordable cars in third world markets and good-margin premium cars. When averaged out, of course their overall margins seem low.
Once Tesla starts selling affordable cars in India and Southeast Asia for US$10k-20k, then we can have a more accurate comparison between Tesla and Toyota. Until then, such comparisons are absolutely pointless.
Quote: “Tesla reported Q3 2022 net profit of US$3.29 billion (RM14.9 billion) while Toyota stated that it made a net profit of US$3.15 billion (RM14.3 billion) for the same period”
Why the comparison is pointless? Toyota is not forced to do business in India and SEA?
When you sell washing machine at car’s price…