With their fleet of electrified vehicles crammed to the brim with chip-hungry displays and onboard sensors, you'd think the ongoing global silicon shortage would've hit Tesla (NASDAQ: TSLA) the hardest.
Tesla even had to shutter production at its Fremont, CA plant back in February due to a lack of chips. And in any other world, having fewer vehicles to sell would've resulted in fewer sales.
But this isn't any other world, and Tesla isn't any other car company. Over the first few months of 2021, Tesla managed to deliver 184,800 vehicles versus the 88,400 it managed to sell over the same time in 2020. Notably, 180,000 of the cars Tesla sold off consisted of just two models: the Model 3 and the Model Y, the latter of which only recently debuted in China.
According to Wedbush analyst Daniel Ives, Tesla's ability to beat the street's expectations in the first quarter amounts to a "paradigm changer." Despite the ongoing chip shortage, Ives believes that Tesla is on pace to deliver 850,000 vehicles in 2021. To Ives, Tesla's sales figures signal "pent up demand" for Tesla's flagship Model Y and Model 3's and could be a signal for an approaching "green tidal wave."
And his thesis doesn't seem far off when considering how the other "big three" U.S. automakers have also managed to smash expectations in the electric vehicle space. Ford (NYSE: F) saw sales of its all-electric Mustang Mach-E and its hybrid F-150 surge by 74.1% during the first quarter.
Meanwhile, Stellantis' (NYSE: STLA) chairman John Elkann recently announced plans to sell more than 400,000 plug-in models this year, more than triple the 139,000 electrified cars the company managed to sell in 2020. A few years ago, Stellantis' lofty sales targets would've been seen as wishful thinking by many analysts. Not today, given that Volkswagen managed to offload 422,000 plug-in models just last year.
But of the big three U.S. automakers, GM (NYSE: GM) stands out the most in terms of its ambitions for electrification. Of the big three, only GM at this point plans to scrap the internal combustion engine entirely by 2035. GM is also on the fast track, along with Tesla, to develop an affordable battery pack. By 2025 GM hopes to have doubled their batteries' energy density and lowered their cost by 60%.
2021 is also shaping up to be a banner year for electric vehicles on the political front as well. Daniel Ives believes pent-up demand from consumers could lead Congress to expand the Electric Vehicle tax credit to as much as $10,000 per vehicle. Given that gas-guzzlers typically sell for $10,000 more than their electric counterparts, such a rebate would go a long way in leveling the playing field for EVs.
There's also President Joe Biden's recently announced $2.5 trillion infrastructure push. The White House's initial proposal has $174 billion earmarked for EV's including more incentives, rebates, tax credits. The proposal also contains plans to develop a network of 500,000 U.S. charging stations.
But, looking at the number of EV's sold in the first quarter, it doesn't seem Tesla nor the Big Three will need Congress' help to continue smashing sales records.