Tesla's Amazing 70-80% Growth Rate a Year and More
Elon Musk was shown in a recent video with the opening of Giga Berlin as he was letting the audience answer questions and Elon Musk was answering them. This is very rare for a CEO of a trillion dollar company to do. It's the behavior of something who has nothing to hide. This information was better than an earnings call.
People who follow the EV industry asked questions. It would be cool to ask about Tesla producing their own LFP batteries, but nobody asked about it. Something Elon Musk said was very profound: the rough calculation was that it was about 300 terawatt hours is needed to create a sustainable economy.
Elon said Tesla is doing a good job and growing from 70 to 80 percent a year and that sometimes Tesla will grow faster than that in the future. This number is astounding, but not even accurate about the trajectory of Tesla.
Tesla has grown 70-80% annual growth even through a pandemic and chip shortage. That's phenomenal. And Elon said maybe even faster than that in the future. Wow. When companies talk about growth, they talk about earnings growth because this is the most important thing for the price tag of the stock.
Tesla Future Production Numbers
Elon was talking about vehicle production when he talked about the percentage growth. Elon just said we expect 70-80% growth to continue and maybe even faster in the future. All forecasts for Tesla trying to predict its future are at around 50% and not aligned with this much faster growth.
Tesla has two more new factories about to reach volume production. Giga Texas is enormous and Giga Berlin is pretty big. The manufacturing processes are going to be really advanced and everything else. Tesla likely saw this additional growth before Wall Street and anyone else.
I think this information is going over the Media and Wall Street's head. Only true Tesla fans were at the Giga Berlin meeting - only Tesla believers who he could speak the truth to and not sandbag. Let's take a look at the numbers.
Let's take a 70% compound annual growth rate. By 2027, that gets us to 22,458,125 vehicles, already over the 20 million Tesla has planned for the next 10 years.
What about an 80% growth. In 2027, that takes us to 31,645,721 vehicles.
At 90%, we get to 43,772,523 vehicles in 2027. Things are starting to get nutty at this point.
Just for fun, at 100% growth, we get to 59,547,008 vehicles in 2027, a number nobody is even dreaming of being a possibility.
The bottleneck is the engineers required and getting enough batteries. Elon Musk's Texas Institute of Technology and Science might be the way Tesla gets the engineers.
Tesla would also need to produce more efficient models to reach these large vehicle numbers - a smaller Model 3 perhaps? I'm not sure the Cybertruck will be released next year with this rate of growth...
Will Tesla keep growing at this rate? Will Tesla grow even faster in the future? Will Tesla wait for the Cybertruck beyond 2023?
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.