Tesla Q1 Earnings: Robotaxi in 2024, Cybertruck in 2023, Record profit

By Gabe Rodriguez Morrison
Tesla continues to simplify the manufacturing process
Tesla continues to simplify the manufacturing process

Financial Results

Tesla just reported first-quarter results for 2022 and beat analysts' expectations on the top and bottom lines. Despite factory shutdowns, inflationary pressures and semiconductor chip shortages, the automaker delivered 310,000 vehicles, up 81% YoY.

Revenue also rose 81% to $18.6 billion from $10.39 billion a year ago, thanks to higher average car prices and increased vehicle sales, the company said.

For the period ending March 31, 2022, Tesla reported $3.22 earnings per share. Since posting a record profit, shares have risen as much as 6% in after-hours trading.

Tesla vehicle deliveries since 2018
Tesla vehicle deliveries since 2018

Challenges This Quarter

In its letter to investors, Tesla said supply-chain problems and raw-material prices costs have increased “multiple-fold”.

"Our own factories have been running below capacity for several quarters,” Tesla said in its shareholder deck. The company did not give detailed guidance on deliveries going forward, but said it expects 50% annual growth on a multi-year basis, and warned that supply chain constraints are likely to continue through 2022."

Tesla said that a spike in COVID-19 cases caused a temporary shutdown of the Shanghai factory and shortages in the company’s supply chain.

Tesla had its most profitable quarter
Tesla had its most profitable quarter

“Although limited production has recently restarted, we continue to monitor the situation closely,” the company said.

The ramp-up in the newer Texas and Berlin gigafactories will also depend on supply-chain obstacles, Tesla said.

“Factory ramps take time, and Gigafactory Austin and Gigafactory Berlin-Brandenburg will be no different.”

The company also stated it would release its Full-Self Driving to all U.S. customers that opted for the $12,000 package “before the end of this year.”

Energy

Tesla’s solar deployments dropped by 50% YoY to 48 MW this past quarter. The company deployed 846 MWh of battery storage systems, up 90% YoY, but down from the previous quarter. The company said declines in solar deployments were caused by supply chain constraints on certain components.

Insurance

Tesla says they are the 2nd largest insurer of Teslas in the state of Texas, and could be the largest by the end of next quarter. Tesla is now a fully integrated provider of insurance in the states (list of states) where they have released their insurance product.

Cybertruck and Robotaxi

On the earnings call, Elon confirmed Cybertruck production to begin in 2023 and a vehicle built for autonomy, without a steering wheel or pedals to be produced in 2024 which would be "a massive driver of Tesla's growth."

Elon also reiterated his stance on Tesla's optimus robot, saying that it has more potential opportunity than the car business over time.

When asked about raw materials and scaling to extreme size, Elon stated that Lithium mining is the limiting factor to production. He later said that "Tesla will likely need to help the industry on this."

When asked about the future of EV affordability, Elon stated that the robotaxi will provide the lowest cost per mile of transport ever, a 5x-10x reduction, making it accessible to everyone. Based on their projections, it appears that a robo taxi will cost less than a subsidized bus/subway ticket.

Earnings Overview

Twitter user @DBurkland put together this overview of everything that was discussed during the earnings call.

Opening remarks from Zach Kirkhorn

  • Per unit vehicle costs increased due to inflation, raw material costs, and supply chain constraints
  • Slight shift towards more profitable vehicles like the Model Y
  • Energy business continues to be impacted by macro conditions more than vehicle business (chip constraints)
  • Achieved record operating margin over 19% amidst construction of 2 new factories (Giga Berlin & Giga Texas)
  • Tesla has reduced debt (excluding product debt) to nearly 0
  • Lost 1 month of build volume lost due to COVID-related shutdowns at Giga Shanghai (will dramatically affect Q2 delivery numbers)
  • Inefficiencies of ramping process at Giga Berlin & Texas will affect bottom line
  • Tesla still believes 50% YoY growth w/ vehicle production in 2022 is still achievable

Opening remarks from Elon Musk

  • Record deliveries and production even with many headwinds
  • Even with COVID shutdowns in Giga Shanghai Elon believes they still have a shot at 60% YoY growth for 2022
  • Two new factories opened in Q1 and exponentially ramping (Giga Berlin & Giga Texas) with higher production volumes achievable by end of this year
  • Just crossed 1m units in the last year however long way to go as Tesla aspires to produce 20m units per year (only 5% towards their goal)
  • Elon never more excited for Tesla and their future then he is now
  • Robotaxi
    • Highly optimized for autonomy (no steering wheel or pedals)
    • Numerous other innovations
    • Fundamentally optimized for lowest fully considered cost per mile, accounting for everything (very powerful product)
    • Expect to reach volume production of Robotaxi in 2024
  • CyberTruck
    • On track for volume production in 2023
  • Optimus
    • Elon surprised people weren’t more excited for this but he thinks folks will fully understand its capabilities & impact will be greater than FSD or vehicle businesses
  • Energy
    • Battery & solar production will improve as supply chain issues are resolved

Q&A

FSD Development Progress

  • Elon has never seen more false dawns than with the development of FSD. Real world AI has to be solved for (nobody has solved yet) and with our roads designed for humans, NNs & cameras have to be solved in a way that is on-par with (and exceeds) the capabilities of humans. Elon still believes they will deliver on FSD in 2022. Best way to realize this is participate in FSD beta program and experience it for ourselves as they’ll be expanding the program later this year. Still targeting new FSD release cadence of every 2 weeks.

Giga Shanghai Shutdown

  • Production is coming back with a vengeance and Elon expects weekly production records to be broken as they work to catch up. Still possible to match / exceed Q1 numbers however Q3 & Q4 are expected to be record quarters in terms of production. Elon believes Tesla will easily be able to produce 1.5m vehicles this year.
  • It’s important for new factories to target limited configurations during ramp and that is why both Giga Berlin & Giga Texas are hyper-focused on producing the Model Y.
  • Ramp period (5k per week) takes typically 9-12 months from start of production however it’s possible for Tesla to ramp sooner based on their experience.

Price Increase

  • Elon says it is understandable that there are many folks questioning price increases especially amidst record profitability however the price increases are there to account for an increase in raw materials costs and potential supply chain constraints in the future (since vehicle deliveries are a year out).

State-based Dealership Laws

  • Tesla would love federal-based laws that allows direct sales across the country however congress is not willing to take up this sort of legislation at this time (so Tesla is approaching it on a state-by-state basis)

800V Battery Architecture

  • Tesla is not ignoring the reality that they can go to a higher voltage however there is not any compelling reason to change at this point
  • Going from 400V to 800V might save them $100 per vehicle (however requires changing all of the backend infrastructure)
  • Switching to 800V might make sense down the road however Tesla needs to increase vehicle volume to absorb the cost of moving from 400V to 800V first
  • For larger vehicles where higher power on the battery side and/or charging side is required (where current requirements go up), savings can be seen by increasing voltage as it would reduce semiconductor needs (and thus save $)
    • Tesla is considering different voltages for CyberTruck and Semi
    • For 3, Y, and Robotaxi they see no need to switch

4680 Batteries

  • Tesla is working in all areas that they described during the battery day event and making good progress
  • Going to take several years to achieve the cost savings and performance numbers they described during battery day
  • 4680 structural pack will be competitive with the best alternatives later this year and exceed the best alternatives next year
  • New chemistries hinted at however will be included in 4680 production later on
  • Based on Giga Texas factory construction, the 4680 production equipment cost 5x less than what it would have been with other battery cell designs
    • Cost model well understood, rate and yield will be better understood as they ramp over next few years
  • Giga Berlin will transition to 4680s from 2170s later this year
  • Giga Texas has the capability to produce non-structural pack for 2170s (mitigation)
    • Volume production for 4680s in Giga Texas targeted by end of Q3, for sure Q4
    • Sizable cell inventory thanks to Giga Shanghai shutdown and allows them to be more deliberate in 4680 development (gives them some breathing room during ramp)
    • 4680 production not a risk to achieving vehicle production target in 2022 however would be in 2023

Raw Materials Required To Scale

  • Tesla needs to think about tonnage of Nickel, Iron Phosphate, Graphite, Separators, Electrolytes for the world as a whole
  • Then take action on limiting factors that get in the way of the advent of a sustainable energy future
  • Tesla is thinking about mining & refining Lithium is a current limiting factor and responsible for cost growth per cell as of late (single biggest on a percentage basis)
  • Lithium only makes up only 2-3% of a Li-Ion cell (5kg per car)
  • Cathode (Nickel & Iron Phosphate) is the heaviest in terms of cost and raw materials composition of a battery cell
  • Exciting announcements on the raw materials topic in the months to come, Elon hinted to a follow up call / event
  • Tesla committed to recycling at all cell factories, recycling 50T per week in Reno (ramping to 150T) which is putting materials right back into their Cathode supply chain
  • As they are building new vehicles at new factories, Tesla is recycling everything they can from a raw materials perspective
  • Tesla figured out they can recycle cast aluminum wheels from retired ICE cars and throw it into their aluminum melting pot and use for vehicle body production for 3 & Y
  • Half of Tesla’s products were LFP-based in Q1 2022 which shows how nimble they are regarding battery chemistry
    • Also looking at other cathode options to give Tesla further agility
  • Some of the challenges with Lithium market are not related to supply & demand fundamentals (frustrating to Tesla)

Giga Berlin & Texas Ramping related to Giga Shanghai

  • Elon thinks they need to ramp Berlin & Texas faster than Shanghai as they are more experienced now and have learned so much in the simplification of Model Y production
  • Body line for front & rear cast underbody + structural pack is 60% smaller than it would be otherwise in terms of equipment required
  • If you are waiting for the best Tesla ever you will be waiting forever as they are constantly improving

Robotaxi

  • Unveiling event sometime next year, Elon doesn’t want to go into too many details until then
  • Volume production in 2024
  • Sizable investment required to build robotaxi production lines

Prices Over Time

  • Elon wants to make EVs as affordable as possible however this has become very difficult due to inflation (40-50yr high)
  • Likely to continue for remainder of 2022
  • Long term contracts with suppliers have helped Tesla keep costs down longer than expected but eventually they run out
  • 20-30% cost increase from suppliers over last year which is why Tesla has raised their prices
  • Lithium margins are practically software margins right now (Elon encouraging more to get into this business)

CyberTruck

  • Ignoring battery cells Tesla believes the CyberTruck is made of 20-30% less parts than a typical pickup truck

Giga Nevada

  • Room for expansion there and the plan is to expand production at Giga Nevada further
  • Majority of battery cells will be produced at Giga Texas going forward

COVID Shutdowns in China

  • Elon doesn’t think recent COVID shutdowns in China will negatively impact production elsewhere

Elon compensation

  • No plans or talks to increase Elon’s compensation further

3rd Party Access to Supercharger Network in USA

  • Tesla plans to provide 3rd party vehicle access to the entire world and remains committed to that
  • Tesla is pursuing a technical solution to address the difference in charging connector in the US (magic dock)
  • Growth of Supercharger network is being accelerated to match increase in vehicle production 

Tesla Insurance

  • In state of Texas Tesla is the second largest insurer of Teslas and should be #1 in the next quarter
  • Working to get 80% of states access to Tesla insurance by end of year at which point they’ll look to expand to other markets
  • Having realtime feedback for driving habits (safety score program) is proving helpful to Tesla owners w/ Tesla insurance as it directly relates to a lower rate
  • When a crash happens it gives Tesla a new feedback loop to improve vehicle design, reduce costs, etc (End-to-end visibility)

You can also find outlines from previous earnings calls on his website DBurkland.com.

Tesla’s LFP Factory in North America Almost Complete — More LFP Vehicles Could Follow

By Karan Singh
Not a Tesla App

In a new video posted to X, Tesla is showing the progress of its first Lithium Iron Phosphate (LFP) cell manufacturing factory in North America. The facility, located in Sparks, Nevada, will be used to produce LFP battery cells for Megapacks and Powerwall.

However, the implications of this new factory extend beyond Tesla Energy. By on-shoring the production of these cost-effective batteries, Tesla is not only securing its energy supply chain but also opening the door to potentially reintroducing LFP-based vehicles in North America.

Megapack First

The immediate beneficiary of the new Nevada LFP facility is Tesla’s Energy division. LFP chemistry is ideal for stationary storage products like Megapack and Powerwall. It offers a very long life cycle, is extremely thermally stable and safe, and is significantly cheaper to produce than nickel-based batteries, partly because it contains no cobalt.

Until now, Tesla has relied on suppliers like CATL in China for these cells. A dedicated, domestic supply will enable Tesla to dramatically ramp up Megapack production to meet North America’s increasing demand for grid-scale energy. On the other hand, Megafactory Shanghai continues to utilize CATL’s LFP batteries and will support the rest of the world. 

Tesla first revealed that they were planning to onshore LFP production in North America at the Q1 2025 Earnings Call, which will help them avoid costs, innovate in new technology, and insulate themselves from geopolitical supply chain risks.

A Potential Return for LFP Vehicles?

Another exciting application for Tesla is what this new factory means for Tesla’s budget-oriented lineup. For years, Tesla has been constrained in its ability to offer LFP-based vehicles in North America. While LFP packs are used in other markets for specific standard-range RWD vehicles, tariffs on important Chinese cells made it difficult to import these cells for use in North America.

With a domestic supply of LFP cells produced in Nevada, this tariff-related barrier will be mostly eliminated, pending the sourcing of lithium from a North American site. This is likely to lead to the reintroduction of LFP-based vehicles to the North American market, possibly in late 2026 or 2027.

An American-made LFP pack could lead to a more affordable base Model 3 or Model Y, or potentially help Tesla cut costs on the next-generation Affordable Model even further. This helps to give customers a lower-cost entry point without sacrificing a lot of range, and with the added benefit of being able to regularly charge to 100%.

Mega Nevada

With Mega Nevada now progressing well, Tesla is in an excellent position to continue iterating on its vertical integration and scaling Megapack and Powerwall—two of Tesla’s fastest-growing businesses—further. There are tons of benefits for consumers in the future as Tesla continues down this path, with more affordable Powerwalls for the home, cheaper electricity prices thanks to grid-forming Megapacks, and cheaper LFP vehicles.

Tesla Grok App: First Look at Its Interface and Features

By Karan Singh
@greentheonly on X

The next major upgrade for Tesla’s in-car experience is pretty much already here - just hiding beneath the surface, awaiting the flick of a switch. According to new details uncovered by Tesla hacker Greentheonly, a fully functional version of the Grok conversational AI assistant is already present in recent firmware builds, just waiting for Tesla to activate it.

The feature, which is currently behind a server-side switch, could be enabled at any time by Tesla for vehicles running update 2025.20 and newer. The findings provide a better picture of what we already learned from Green’s breakdown on Grok last month.

Grok’s Requirements

@greentheonly on X

According to what Green determined from the latest software builds, the foundation for Grok was laid with update 2025.14, with more abilities and functionality added in 2025.20 to flesh it out. He also determined exactly which vehicles will be receiving Grok.

In terms of hardware, any vehicle with a Ryzen-based infotainment computer will receive Grok. This means that vehicles with the older Intel Atom processor will not be supported, at least initially. The underlying Autopilot hardware is not a factor, as Grok’s processing is not done in-vehicle.

Grok will also require premium connectivity or a Wi-Fi connection for the vehicle. At this point, we’re not sure whether Grok in your Tesla will also require you to sign up for SuperGrok, X Premium, or X Premium+, but Tesla is requiring you to sign into your Grok account. It’s just not clear whether the free version of Grok will work, or if you’ll need the premium version.

Grok User Experience

@greentheonly on X

Green also revealed the user interface for Grok for the first time. You’ll find many of the same features from the Grok app, but surprisingly, it looks like it’ll have a dark UI, even if you’re using light mode in your vehicle.

It appears that there will be a Grok app, likely for settings. However, Grok will largely operate in a modal, similar to voice commands, which are displayed near the bottom left corner of the screen.

There’s an on-screen microphone button, as well as drop-down menus for the voice and type of assistant you’d like to use. 

Similar to the Grok app currently on mobile devices, you’ll be able to select from a set of voices and then define their personality. The available voices for now are the standard Ara (Upbeat Female), Rex (Calm Male), and Gork (Lazy Male).

There’s also a settings button, which, when expanded, allows you to enable or disable NSFW mode (including swearing and adult topics), as well as a Kids Mode, which will tone Grok down to be suitable for when kids are in the car.

@greentheonly on X

How Grok Will Work (Button / Wake Word)

Users will be able to activate Grok by pressing a button, likely the same one that activates voice commands today. Grok will then remain enabled for the duration of your conversation, allowing you to go back and forth, asking and answering questions. To end your conversation, you’ll press the mic button again.

While it doesn’t appear to use a wake word yet, Green says that some code refers to a wake word, so it’s possible that this could be an option Tesla plans to activate in the future.

Replacing Voice Commands

The most significant implication of Grok’s future integration is in its potential to fully replace the existing and relatively rigid voice command system. Green notes that internally, this feature is part of the car assist module, and that eventually, the plan is for Grok to take over car control functions.

Unlike the current system, which requires specific phrases, a true conversational AI like Grok can understand natural language. This will enable more intuitive requests, completely changing how drivers interact with their car.

Language Support

@Greentheonly/X

Grok will also launch with multi-language support, similar to its current abilities in the Grok app. Green says that it already appears to have support for English and Chinese and one or two other languages.

Release Date

Grok appears ready to go from a vehicle standpoint, but Green wasn’t able to actually test it out. While development appears to be nearly complete in the vehicle, Tesla and xAI may still be working on some server-side changes to better integrate with the vehicle. If they plan for Grok to replace voice commands on day one, then it’ll need to be trained and be able to execute a variety of vehicle commands.

It’s possible Tesla is actively testing Grok or adding server-side changes to replace voice commands. However, it looks like vehicle development is nearly complete and Grok could launch as soon as the next major Tesla update, which is expected to be update 2025.24.

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