The results are good, but good enough to think about an S-curve?

After the outstanding first quarter of 2021, some investors say that Tesla is "entering into the slope of its growth S-curve."

That's what Loup Ventures has written recently, but is it really the case?

The momentum is strong - that's for sure. The perspectives are also good: Model S/X refresh, a new plant in Europe and Texas, and new models in the pipeline.

We guess that Tesla will continue to grow at a high rate (the year 2020 was affected by the COVID-19 lockdowns which also lowers the comparison base). However, only time will tell whether an S-curve is possible, especially since Tesla's scale is already very high.

The company itself has said clearly that it expects a growth rate of about 50% a year on average. In some years (like in 2021), it will be more.

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Q1 2021 was the best quarter ever (slightly better than the previous best Q4 2020).

We always must pay attention to year-over-year changes and here the result is two times better than before. When we look only at Q1 results over the years, it looks like an S-curve for a long time.

  • Total deliveries: 184,800 (up 109% year-over-year)
    • Model 3/Y deliveries: 182,780 (up 140% year-over-year)
    • Model S/X deliveries: 2,020 (down 83% year-over-year)
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The 12-month rolling sales result is at almost 600,000, which is maybe a better indicator of the growth rate.

With the existing manufacturing capacity, Tesla heads towards 1 million electric cars a year. It will increase probably every quarter now, but as we can see, it's not a consistent move.

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Dynamic changes on the market (demand side), retooling of the plants and launches of new production lines with ramp-up phases affect the results.

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