How Tesla Makes Money in 2022

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Tesla doesn’t just sell Model 3s and Model Ys, even though these two electric cars are now its biggest hits and main sources of revenue. Over the past three months, a record 366,000 cars have been produced. Up 8% on the stock market, Tesla should present an operating profit with a growth of 50% from one quarter to another thanks to these very good results.

But how does the manufacturer Tesla make money? With such production volumes, the answer seems to be found. But Tesla cannot weigh more than 680 billion dollars on the stock market by delivering “only” a million cars, at a time when Toyota weighs 298 billion dollars with a production ten times larger. In reality, if his cars represent 96% of his profits, they weigh for 85% of his total income. 15% goes to his other activities, and here are which ones.

Where does Tesla’s revenue come from?

Last quarter, Tesla posted $16.9 billion in revenue. Among them, therefore, the automobile and the sale of its four electric models represent 14.6 billion dollars. Then come two other categories well highlighted by the company. There is electricity production and storage, which represents 5% of total revenues, for 866 million dollars generated in the second quarter. Finally, for a 9% share, Tesla includes its “services and others”, which include workshop services, out-of-warranty repairs and the sale of used vehicles.

  • Automotive: 86% revenue share for $14.6 billion
  • Services and others: 9% revenue share for $1.47 billion
  • Energy production and storage: 5% revenue share for $866 million

Energy production and storage is an important part of Tesla. Its prospects are numerous as the brand now makes it possible to create “virtual power plants”. In many markets, for professionals as well as for individuals, electrical storage is becoming important. For many municipalities as well, it is a way to better manage resources and prevent potential breakdowns.

That said, not every Tesla business is equally profitable. The gross profit generated with its cars is today much more important than the rest. We therefore find ourselves with a much more unequal distribution in the second quarter:

  • Automotive: 96.4%
  • Benefits and others: 2.3%
  • Energy production and storage: 1.3%

The future of Tesla and its revenue

Should we therefore conclude that Tesla only earns money and creates its value through its four marketed models? Yes and no.

Yes, because on the one hand, it is on this point that it realizes all of its profits. And that production will continue to increase as factories expand around the world and demand grows. The arrival of new models is also an important aspect. Tesla is preparing for the arrival of the Tesla Semi, its truck with tens of thousands of pre-orders, and its Cybertruck.

But Tesla isn’t just about selling cars. Its activity in energy is far from remaining marginal and Elon Musk showed, during his last “AI Day” conference, that the commercialization of a humanoid robot is coming. Finally, mobility will largely pass through car sharing and robotaxis at Tesla, which will no longer necessarily see its cars as products, but as services. For this, the brand still needs to solve its autonomous driving problems, which have led it to multiply the delays.

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