The Secret Behind Tesla's Record Performance Amid Supply Chain Collapse (Comprehensive)

[Asia Economy Reporter Yujin Cho] Despite the global semiconductor supply shortage, the American electric vehicle company Tesla has achieved record sales for six consecutive quarters. Analysts attribute this to Tesla's unique production structure known as 'vertical integration of technology.'

On the 20th (local time), Tesla announced in its Q3 earnings report that its sales reached $13.76 billion (approximately 16.168 trillion KRW), an increase of more than 50% compared to the same period last year ($8.77 billion).

This marks a record sales achievement for six consecutive quarters since Q2 last year, surpassing Wall Street analysts' expectations ($13.63 billion). During the same period, quarterly net profit was $1.62 billion, nearly four times (389%) higher than the $331 million recorded in the same quarter last year.

Tesla's performance on this day has drawn even more attention as it comes amid a global semiconductor and supply shortage affecting automobile companies worldwide. In this regard, The Wall Street Journal (WSJ) analyzed that Tesla's business structure, where hardware and software are vertically integrated unlike other competitors, was the reason it could more smoothly resolve the chip supply shortage crisis.

Most automakers receive parts from numerous large component suppliers, but the parts they supply are completed through many smaller component suppliers, making it difficult to grasp the entire supply chain.

In contrast, Tesla possesses proprietary design technology and the capability to replace key components. For example, Tesla's engineering team directly designed an alternative technology for microcontrollers, a key component in vehicle production and identified as the main cause of the current semiconductor bottleneck.

The structure of independently designing core technologies and integrating related component networks distinguishes Tesla from other automakers that rely heavily on external large component suppliers. Dan Levy, an analyst at Credit Suisse, said, "Tesla has better responsiveness in chip sourcing due to its software technology leadership."

However, despite these strengths, the prolonged semiconductor shortage has increased cost burdens. Tesla CEO Elon Musk has also warned about cost pressures, stating, "It costs a lot to handle supply chain issues."

In the Q3 earnings report, Tesla acknowledged that "various issues such as semiconductor shortages, port congestion, and power outages are affecting factory operating rates," and stated, "We plan to continue operating production lines at maximum capacity as conditions allow." He added, "While performance growth is our goal, the scale of growth is determined by external factors."

This content was produced with the assistance of AI translation services.