Tesla's (NASDAQ:TSLA) fourth-quarter deliveries clearly impressed investors. The growth stock rose 3.4% on Monday, hitting a new all-time high during the trading day. The electric-car maker revealed that a record quarter put full-year deliveries near half a million, up from about 368,000 in 2019. For a year wrought with unexpected challenges brought about by the coronavirus pandemic, this was quite a feat.

But Tesla's growth will likely be even better in 2021. Here's why.

A bar chart with an arrow highlighting an exponential growth trend

Image source: Getty Images.

Manufacturing capacity expansion

Tesla's approximately 500,000 deliveries in 2020 represented a 36% jump over the company's deliveries in 2019. Not only was this a notable achievement in the face of factory shutdowns earlier this year when Tesla was forced to pause operations to help prevent the spread of COVID-19, but it's impressive in light of Tesla's tough year-ago comparison; 2019 deliveries had risen 50% year over year.

Tesla's strong 2020 growth was primarily driven by the company's investments in production capacity throughout the year. After exiting 2019 producing about 105,000 vehicles per quarter, factory expansions and production line additions led to quarterly production of about 180,000 vehicles by the final quarter of 2020. 

Tesla's aggressive investments in production capacity should similarly lead to strong growth in 2021, as the company is kicking off the year with much greater manufacturing capacity than it had going into 2020. Tesla's installed annual production capacity at the end of Q3 2020 (Tesla's most recent quarter for which it has reported financial results) was 840,000 vehicles. In addition, the company had three more Model Y production lines under construction at the time. This compares to installed annual production capacity for 640,000 vehicles at the end of 2019.

Of course, it takes time for the automaker to ramp up its operations to take full advantage of its installed production capacity. Nevertheless, this metric is a good leading indicator of the company's growth potential, as Tesla's deliveries are typically limited by production constraints -- not demand. 

Tesla's Model S, X, 3, and Y

Model S, X, 3, and Y. Image source: Tesla.

How many vehicles could Tesla deliver this year?

Suffice it to say, it wouldn't be surprising to see Tesla deliver 750,000 or more vehicles this year, translating to 50% growth and marking a significant acceleration in vehicle sales growth. Of course, it wouldn't hurt for investors to wait for official guidance from Tesla management before they start making estimates for the year. But 50% growth certainly seems within reach for the company.

If anything, this estimate could be too conservative. When CEO Elon Musk was asked during the company's third-quarter earnings call whether Tesla could deliver between 840,000 to one million cars during 2021, Musk said "it's in that vicinity." 

2020 was big for Tesla's vehicle sales. But 2021 could be huge.