- Elon Musk expects Tesla to lead the solar market after a ‘better’ integration of two key teams.
- The company was heavily focused on building and producing Model 3 cars but can now turn more attention to solar, Musk said.
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Elon Musk, CEO of Tesla, believes that the electric automaker will soon be the market leader in solar.
During the company’s fourth-quarter earnings call on Wednesday, Musk said there were a few years where the company, including the team that works on solar, was devoted to building and producing Tesla’s Model 3, the company’s first mass-market vehicle.
“Now we got a little more bandwidth, we’re putting a lot of attention on solar, and it’s growing rapidly,” he said. “So I think it will not be long before Tesla is, by far, the market leader in solar.”
Read More: Tesla stock slumps 8% after 4th-quarter earnings fall short of forecasts
Tesla purchased SolarCity, a rooftop solar company company, in 2016. Once the leader in the industry, its installations have dropped in recent years. To regain its footing, Tesla needs to better integrate between Tesla Powerwall, a battery that stores solar energy for use, and Tesla Solar, according to Musk. Tesla Solar includes Tesla Solargalass Roof which is a solar energy system made up of tempered glass tiles containing solar cells.
Musk said that he is confident that the company could integrate Powerwall and Tesla Solar before the end of the year.
"We're focused on reducing the amount of time and the complexity of the install, and we're making great progress in that regard, and I think we'll have something that's really dialed in this year," Musk said.
Tesla has a number of competitors in the space. Earlier this year, the leading rooftop-solar company Sunrun said it would buy the second-largest installer, Vivint Solar. The combined company would control at least 15% of the market. Meantime, Eos Energy Enterprises is competing with the electric automaker in the battery-based electricity storage business as it enables users to store power produced by renewable energy, according to Barrons.
Tesla also needs to achieve an industry-leading cost structure as part of its solar strategy, allowing the company to have an "industry-leading pricing," according to Tesla's CFO Zachary J. Kirkhorn.
Kirkhorn added that the company now has a well-positioned cost structure.
Tesla's fourth-quarter earnings fell short of Wall Street's expectations, as the electric automaker continued to grow its sales and turn a profit despite the coronavirus pandemic.
The company posted revenue of $10.744 billion, compared to an expected $10.33 billion, and $0.80 (adjusted) per share, compared to an expected $1.01 per share.
"Despite unforeseen global challenges, we outpaced many trends seen elsewhere in the industry as we significantly increased volumes, profitability and cash generation," the company said in a press release.
The electric automaker is expected to start delivering its electric semi-truck in 2021 and a "plaid" version of its Model X.