Just as Tesla's (TSLA +3.93%) blowout fourth-quarter vehicle deliveries are grabbing headlines, Morgan Stanley's Adam Jonas is focusing on 2022. The company's staggering momentum, he says, now makes two million deliveries this year possible.
If Tesla were to achieve this, the company's growth rate would accelerate compared to its already-impressive growth in 2021 and deliveries would more than double.
Let's take a look at why Jonas thinks two million deliveries are now within the realm of reason.
Image source: Tesla.
The path to 2 million deliveries
At this point we'd still describe [two million deliveries in 2022] a stretch target but one that looks far more realistic following [Tesla's fourth-quarter] deliveries," said the Morgan Stanley analyst in a note to investors on Monday.
Jonas' belief that this stretch target is possible is based on two main ideas.
First, of course, is Tesla's incredible momentum in Q4. The company grew deliveries 71% year over year to 308,600, blowing past analysts' estimates. Even on a sequential basis, the growth was very strong. Deliveries increased 28% between the company's previous quarterly record of 241,391 just three months earlier. And that figure was up from 201,304 three months before that. Growing like this during a period of some of the worst automobile supply constraints in history speaks volumes about Tesla's momentum.
The second reason Jonas is so optimistic about Tesla's potential in 2022 is the company's new factories. After spending essentially all of 2021 building a new factory in Berlin, Germany, and another in Austin, Texas, these two new factories are just now coming online. Jonas believes that once these factories are ramped up to full production capacity, Tesla will have a global installed production capacity of nearly three million units annually, up from a capacity of just over one million units annually at the end of the company's third quarter. Of course, it's going to take a while for these two new factories to get to full capacity.
Don't expect guidance like this from Tesla
After years of regularly missing its production and delivery targets, electric-car maker Tesla has recently become conservative when it comes to its annual delivery guidance. Last year, for instance, management simply said it expected deliveries to grow more than 50% in 2021. This would imply about 750,000 or more deliveries, up from just under 500,000 in 2020. But actual deliveries soared 87% year over year to more than 936,000 -- and this occurred during a challenging supply and logistics environment.
Tesla may provide conservative guidance again for 2022. Indeed, it wouldn't be surprising to see the company once again guide for deliveries to grow 50% or more. While this would be a far cry from Jonas' bull case for as many as two million deliveries, it speaks to Tesla's strengths that we're calling a forecast for 50% growth conservative -- especially when you consider that that growth would be on top of 87% growth in the prior year.
