Tesla has overcome severe supply chain shortages to achieve record quarterly income.
The company recorded record profits of $1.1bn, despite semiconductor shortages and congestion at ports impacting production.
Revenue rose to $12bn in the three months to the end of June, doubling what the company made in the same period last year, when the company’s US factory was forced to shut.
This was despite the global shortage of semiconductors, which has hit profits at Jaguar Land Rover (JLR).
Tesla said it was able to keep production running “as close to full capacity as possible” by using alternative chips, with its software team reprogramming them within weeks to maintain production.
“Our team has demonstrated an unparalleled ability to react quickly and mitigate disruptions to manufacturing caused by semiconductor shortages,” said Tesla.
“Our electrical and firmware engineering teams remain hard at work designing, developing and validating 19 new variants of controllers in response to ongoing semiconductor shortages.”
Tesla chief executive Elon Musk told investors: "While we're making cars at full speed, the global chip shortage situation remains quite seriouss," adding manufacturing would hinge on this "slowest part of the supply chain".
The global semiconductor shortage has been caused by the Covid pandemic as well as a trade-war between US and China.
JLR reported a pretax loss of £110m due to the shortages of semiconductors, and said it was “significantly constrained” by the shortages.
Adrian Mardell, JLR’s chief financial officer, said: “The global shortage of semiconductors continues to be a challenge which has constrained our financial results in the first quarter.”
He said the company was forced to cut production by 30,000 veichles due to the shortages.
JLR said wholesale volumes were likely to be around 50% lower than planned in the next quarter due to the shortages.
Despite this, the company revealed revenues reached £5bn in the quarter, 73.7% higher than the same period last year.
CEO Thierry Bolloré said: “Though the current environment continues to remain challenging, we will continue to adapt and manage elements that are within our control and ensure that Jaguar Land Rover is well placed to respond to any further market developments.”
The company predicts semiconductor shortages will continue until the second half of its financial year and it will experience “underlying structural capacity issues” for 12-18 months.
Meanwhile, a survey by the Ifo Institute for Economic Research in Munich has found confidence among German companies dipped following a decade-long high, with companies reporting concerns over supply chain disruptions and increases in coronavirus infections.
Ifo Institute president Clemens Fuest told Bloomberg the findings were “surprising” and that companies are “becoming a lot less optimistic for the coming months.”
The report found almost two-thirds of manufacturing companies were experiencing supply problems and confidence was lowest among services, manufacturing and retail trade companies.
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