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 By Luc OLINGA New York (AFP) Jan 30, 2020
Tesla shares surged Thursday after strong quarterly earnings accelerated the evolution of Elon Musk's electric car pioneer from troubled start-up to the world's second most valuable automaker. The company cautioned about a potential impact from the new coronavirus sweeping China, a hub for production and sales, but investors cheered as Tesla said it was again bringing forward the launch of its new Model Y crossover vehicle. Better-than-expected revenue and profit in the fourth quarter to December sent Tesla stock up nearly 10 percent after hours on the Nasdaq exchange, to $636.54. That took Tesla's valuation further past the $100 billion mark, which it hit this month, making it worth more than Volkswagen and second only to Toyota among the world's leading carmakers, although it is still miles behind them in terms of production. And while Tesla has become a favorite for early adopters of electric cars, the established players are hitting back with a fleet of models as governments around the world encourage alternative technologies to help combat climate change. Still, Tesla called 2019 "a turning point" after years of losses on the back of super-charged spending to develop cars such as the mainstream Model 3 sedan. This month, Tesla started to roll out the first Model 3s built at a giant factory in Shanghai. Helped by Shanghai coming online, the group said it was planning to deliver more than half a million vehicles this year, 36 percent more than 2019. Chief financial officer Zach Kirkhorn said the coronavirus crisis could delay a planned increase of the Shanghai plant's output by one to one-and-a-half weeks, after China extended its Lunar New Year holiday and imposed quarantines on dozens of cities. "This may slightly impact profitability for the (current) quarter but is limited as the profit contribution (from Shanghai) remains in the early stages," Kirkhorn said on an earnings call. "We are also closely monitoring whether there will be interruptions in the supply chain for cars built in Fremont (California)," he added. - 'Game-changing' - Bernstein analysts said that of Tesla's total retail volumes in China, last year it sold 82.5 percent in the roughly 40 Chinese cities that have 10 or more diagnosed coronavirus cases. Together, those cities accounted for just under 37 percent of China's total retail volumes in autos. And China's car market, now the world's largest, was already slowing before the outbreak of the deadly virus. In the past quarter, Tesla's sales grew 2.2 percent to $7.38 billion. Its net income came to $105 million, a drop of 25 percent from the end of 2018. Tesla has yet to manage a full-year profit, but the performance in the past three months beat analyst forecasts and was on top of a healthy third quarter. The company delivered 112,000 vehicles in the fourth quarter, a year-on-year jump of nearly 23 percent. The earnings report gave a bloody nose to short sellers who have consistently bet on Tesla's share price imploding -- activity that has prompted one of several online feuds waged by the colourful Musk, Tesla's 48-year-old chief executive. "The short story is eroding," Gene Munster, managing partner of the venture capital firm Loup Ventures, told Bloomberg. He credited Musk for becoming a "quiet assassin" and sees Tesla having a clearer path to profitability. Musk says the new Model Y, a compact sport utility vehicle, will outsell all other Teslas combined. It was initially scheduled to launch this autumn but Musk said deliveries would now start by March. "The Model Y timing is going to send the bulls falling off their chairs," said Dan Ives, an analyst at Wedbush Securities. "This is a game-changing inflection quarter because of the guidance on delivery and profit," he said. bur-jit/rl
GM revives Hummer as all-electric vehicle New York (AFP) Jan 30, 2020 It's official: General Motors on Thursday confirmed its plan to reboot the Hummer - a military-style behemoth once seen as a symbol of American excess - in an all-electric version. GM will unveil the revamped GMC Hummer EV in an ad during Sunday's Super Bowl game, reviving the a vehichle launched in the 1990s but phased out after the 2008 financial crisis. Rumors of the Hummer's rebirth had been circulating in the US press for weeks, but GM made the news official only Thursday, ahead of the ma ... read more
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