Tesla (TSLA) is further tightening its grip on the U.S. auto sector.
The list of trophies won by the manufacturer of premium electric vehicles continues to grow. Elon Musk's firm is the world's largest automotive group by market capitalization with a market value of over $896 billion at the time of writing. Ford's valuation is $57.2 billion and GM's is $52.1 billion.
This crazy valuation makes Tesla the sixth most valuable company in the world behind Apple (AAPL), oil giant Saudi Aramco, Microsoft (MSFT), Alphabet (GOOGL), and Amazon (AMZN).
But if there is a crown that should delight its fans and investors, it is that Tesla earns much more money than its main American rivals Ford (F) and General Motors (GM).
For the second consecutive quarter, Tesla has just announced a net profit higher than that of its Michigan rivals, according to their respective earnings reports.
Tesla reported net profit of $2.3 billion for the second quarter ended June 30, up 98% year-over-year, outperforming GM whose net profit was $1.7 billion, down 40.3%. The Austin, Texas automaker even made three times more money than Ford, which reported a net profit of $667 million, up 19% year-over-year.
The manufacturer of the electric pickup/truck F-150 Lightning explained, however, that its profits have been reduced by a $2.4 billion decline in the value of its stake in the young rival Rivian (RIVN).
Rivian stock prices fell 49% in the second quarter. Ford announced in regulatory filings that it had sold a total of 15 million Rivian shares. The Dearborn group still holds 86.95 million Rivian shares, making it one of the main shareholders alongside Amazon and the legendary financier George Soros.
Tesla Manages Its Costs Better
Ford therefore prefers to highlight its adjusted earnings before interest and taxes (adjusted Ebit) which amounts to $3.7 billion.
But looking at margins before interest, taxes, depreciation, and amortization, or adjusted EBITDA margin, which is another gauge of profitability, Tesla maintains leadership. Its adjusted EBITDA margin was about 22.4% in the second quarter compared to 20.8% in the second quarter of 2021.
GM's adjusted EBIT margin -- margin before interest and taxes -- was 6.6%, halved year-over-year. Ford's adjusted EBIT margin is 8.8%. Basically, Tesla is significantly more profitable than Ford and GM.
Tesla makes the difference on costs. The company seems to have better control over its costs, which is easy when you spend $0 on marketing, while rivals are flooding consumers with ads touting the merits of their latest models.
For example, Ford's total costs increased year on year by 39.4% in the second quarter.
Tesla's performance is all the more spectacular as the disruptor produces and delivers far fewer cars than its two rivals. In the second quarter, Musk's group produced over 258,000 vehicles and delivered over 254,000 vehicles worldwide.
GM delivered 582,401 vehicles in the U.S alone, while Ford delivered 483,688 new vehicles to U.S customers.
In the first quarter, Tesla just reported a net income of $3.31 billion. By comparison, GM recorded a net profit of $2.93 billion in the same period.
Ford, for its part, posted a net loss of $3.1 billion.
