Tesla looks abroad to keep growth going as US revenue plateaus

FRESH off weeks in which it started taking orders in Malaysia and exhibited at a motorsports festival in the UK, Tesla disclosed more sales than ever outside the US and China.

The carmaker revealed in a regulatory filing on Monday (Jul 24) that revenue from other international markets more than doubled to US$7.86 billion in the second quarter. While the US remains Tesla’s biggest source of sales, revenue there has plateaued.

After approaching US$12 billion in the final three months of last year, sales in Tesla’s home market have been lower each of the last two quarters. Revenue came to US$11.3 billion in the US and US$5.7 billion in China in the three months that ended in June.

Growing revenue will be a challenge in the third quarter because Tesla has scheduled shutdowns at its factories for upgrades. Chief executive officer Elon Musk said during the company’s earnings call last week that production will probably be down slightly, without going into specifics.

Production “choppiness” is likely going to weigh on Tesla shares in the near term, RBC Capital Markets Tom Narayan wrote in a Jul 20 report. He said it calls into question whether the company has reached a “local maximum” for the Model 3 and Y, the two models that accounted for 97 per cent of deliveries in the first half of the year. BLOOMBERG