Tesla Reports Third-Quarter Profit That Beats Market Expectations (cnbc.com) 195
Rei writes: When Tesla announced late last year that it was targeting sustained profitability in the second half of 2018, reaffirming this target throughout the year, the markets reacted with skepticism. Indeed, despite repeated insistence that the company had no need for a capital round, news analysts have treated the concept of Tesla dilution to raise more capital as inevitable and urgent to pay off convertible bonds next spring, even suggesting insidious theories that the reason it hadn't was that it "couldn't."
Well, today Tesla put the doubts to rest with a blockbuster Q3 report -- not simply eking out a profit and small free cash flow growth, but $2.92 per-share profit and $881 million free cash flow -- almost raising the entire value of their convertible bond debt in a single quarter. While many were skeptical about Tesla's claims that it would go from near zero profit margin on Model 3s to their claimed target of 15%, Tesla instead hit a 20% margin on the Model 3 (now the highest-revenue car in the U.S.), with a 25.8% overall automotive gross margin. This was all achieved with only $52 million worth of zero-emission vehicle credits claimed this quarter. While Tesla bears will likely claim that this quarter was a one-off that won't be repeated, Tesla reiterates guidance for sustained profitability from herein, barring a force majeure event.
Well, today Tesla put the doubts to rest with a blockbuster Q3 report -- not simply eking out a profit and small free cash flow growth, but $2.92 per-share profit and $881 million free cash flow -- almost raising the entire value of their convertible bond debt in a single quarter. While many were skeptical about Tesla's claims that it would go from near zero profit margin on Model 3s to their claimed target of 15%, Tesla instead hit a 20% margin on the Model 3 (now the highest-revenue car in the U.S.), with a 25.8% overall automotive gross margin. This was all achieved with only $52 million worth of zero-emission vehicle credits claimed this quarter. While Tesla bears will likely claim that this quarter was a one-off that won't be repeated, Tesla reiterates guidance for sustained profitability from herein, barring a force majeure event.
Waiting to hear... (Score:5, Insightful)
I'm waiting to hear how Tesla is losing money on each car it sells, such as some people have been saying around here (FALSELY) for months. If they lose money on each car they sell, how did they wildly beat all the analysts by selling more of them?
When everyone is telling you that you are wrong, sometimes it's a good idea to gain a little objectivity and at least examine the possibility that you actually are wrong.
Volume (Score:2)
they make it up on volume.
Re:Waiting to hear... (Score:5, Interesting)
I'm waiting to hear how Tesla is losing money on each car it sells, such as some people have been saying around here (FALSELY) for months. If they lose money on each car they sell, how did they wildly beat all the analysts by selling more of them?
When everyone is telling you that you are wrong, sometimes it's a good idea to gain a little objectivity and at least examine the possibility that you actually are wrong.
Tesla had its best quarter in a while. Hopefully, it can continue to execute in manufacturing cars and meet future debt payments. It's not out of the wood yet, but the direction looks good. A strong, successful Tesla will be good for consumers, the car market, and even for other car companies.
However, since it's Tesla and Musk, the report stretches facts somewhat. "Model 3 was the best-selling car in the US in terms of revenue and the 5th best-selling car in terms of volume." Well, that's technically true, if you exclude the top-6(!) selling vehicles in the US. That is, if you exclude the 65-70% of the car market represented by trucks and SUVs, which are technically not cars, then the Model 3 is the top revenue seller. But, that doesn't sound as impressive, even though it actually is.
Re:Waiting to hear... (Score:5, Insightful)
Tesla had its best quarter in a while. Hopefully, it can continue to execute in manufacturing cars and meet future debt payments. It's not out of the wood yet, but the direction looks good. A strong, successful Tesla will be good for consumers, the car market, and even for other car companies.
However, since it's Tesla and Musk, the report stretches facts somewhat. "Model 3 was the best-selling car in the US in terms of revenue and the 5th best-selling car in terms of volume." Well, that's technically true, if you exclude the top-6(!) selling vehicles in the US. That is, if you exclude the 65-70% of the car market represented by trucks and SUVs, which are technically not cars, then the Model 3 is the top revenue seller. But, that doesn't sound as impressive, even though it actually is.
Agreed. For a car company that didn't exist twenty years ago, and whose market share was within the margin of error five years ago, even being #11 is pretty freaking amazing.
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That's pedantically true. The thing is, in the minds of most people, the distinctions are not between cars and trucks, but rather between personal vehicles and non-personal vehicles.
The personal vehicles category obviously includes all cars and crossover vehicles, but also includes small-to-medium pickup trucks, SUVs, minivans, and 8-passenger full-sized vans. These are the vehicles that most people buy and drive around town.
The non-personal vehicles category includes everything else. This includes larg
Losing money on early production is normal (Score:5, Informative)
I'm waiting to hear how Tesla is losing money on each car it sells, such as some people have been saying around here (FALSELY) for months.
Tesla HAS been losing money on each car they sell. That is a factual statement. But it doesn't mean what some people think it means. People here keep confusing gross margin [wikipedia.org] with net margin [wikipedia.org] and haven't a clue what free cash flow [wikipedia.org] is or fixed costs [wikipedia.org] or variable costs [wikipedia.org].
It's absolutely normal for a new product to lose money on the first units they produce because they haven't produced enough units to amortize the fixed costs [wikipedia.org] over. Here's a oversimplified totally-made-up example. I spend $1,000,000 making an assembly line - one time cost never to be repeated. It also costs $500,000 per year to operate the assembly line no matter how many units I make whether it be 1 or 100,000. So before I make a single unit I have $1.5 million in operating costs. Let's say I'm selling a car for $50,000 and my actual cost of labor and materials in that car is $40,000 so I have a gross profit of $10,000 per vehicle. That means the first 150 vehicles I make are going to be sold at a loss. I also have to sell a minimum of 50 vehicles every year just to cover the fixed costs of operation.
Tesla is in that exact situation, just with much larger numbers. The have the added wrinkle that they also have a lot of debt to service (around $11 billion reportedly) which can be treated as an additional fixed cost.
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Tesla HAS been losing money on each car they sell. That is a factual statement. But it doesn't mean what some people think it means.
Nice try, but no. "Tesla is still losing money" might mean what you describe. But "on each car they sell" is clearly referring to the per-car production cost versus the per-car price.
By the way, there is no fact when things are badly defined. To your credit, you defined what you mean. Usually those who stress they relay "facts" carefully avoid that step, making sure they can endlessly debate/troll.
Clear definitions don't equal tidy solutions (Score:2)
Nice try, but no. "Tesla is still losing money" might mean what you describe.
I'm among other things a certified accountant and my specialty is corporate cost accounting in manufacturing. There is no "might" qualifier here. I described exactly what is happening with Tesla from a big picture perspective. It's nothing unusual. My company has exactly the same situation of every product we sell albeit on a much smaller scale. The company you work for does too.
But "on each car they sell" is clearly referring to the per-car production cost versus the per-car price.
Per car production costs are not a fixed number and it's a mistake to think they are. You cannot simply take the cost of th
Re: Waiting to hear... (Score:5, Informative)
Not so. They report bot produced and delivered cars. Just take a look at the report to understand the company financials. It's much more intelligent than just talking out of your ass:
The Latest 10-q [tesla.com]
The Update Letter [tesla.com]
Both of those documents are SEC filed.
Re: Waiting to hear... (Score:5, Informative)
Your point was that they were not following GAAP accounting. Had you taken my advice and read the report I conveniently linked to you, you would have seen the very first sentence : Q2 Automotive gross margin increased to 20.6% GAAP and 21.0% non-GAAP.
Thats their profit margin. Also, FYI, you book revenue when you ship, not produce. So having 13k vehicles in inventory is a drag on their balance sheet, not a boost.
Gross margin is NOT profit (Score:4, Interesting)
Q2 Automotive gross margin increased to 20.6% GAAP and 21.0% non-GAAP. Thats their profit margin.
Gross margin is NOT profit margin. Those are different things and you need to understand the difference. Gross margin does not consider sales, administration, interest, taxes, and other overhead like engineering etc. Gross margin is just revenue minus cost of goods sold [wikipedia.org] which is just direct costs of materials and labor. Gross margin is NOT profit and should not be confused with profit. You can easily have a 20% gross margin but a negative profit margin and if that remains the case long enough the company will eventually go bankrupt. Software companies often have gross margins in the 60-80% range because cost of production is very tiny - most of their costs are in engineering, sales and marketing. Manufacturing companies usually have gross margins in the 15-40% range depending on the product being made but that does not mean they are profitable.
Also, FYI, you book revenue when you ship, not produce. So having 13k vehicles in inventory is a drag on their balance sheet, not a boost.
How revenue is booked is unfortunately FAR more complicated and to a significant degree is an arbitrary decision. It's perfectly legitimate to book a sale when you sign a contract but before the product is delivered. Many companies do this. Other companies book the sale when the product is sent to a distributor (like an auto dealer) but not actually sold to the end customer. Other companies only book a sale when the end customer has received the product. You can even book a sale when cash is received for the product. All of these approaches are perfectly valid under GAAP. From what I understand Tesla somewhat conservatively books sales only when the customer takes delivery of the car. This is unusual in the industry. Most of the big auto makers book "sales" when the ship a car to a dealer even if it hasn't actually been sold to an end customer. They are treating the dealer as the customer of the product.
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The point is that the naysayers were ignoring how much of the loss was one time costs (to work out production problems, also I think some was to shed dead weight) and also ignoring the 13k cars produced and not sold thus extending the tax rebates, but also counting towards sales and income. (Ignoring, except when it came to talking about how demand was shrinking and how bad things were that Tesla hadn't been able to sell all these cars.) And since tesla is run exactly like a Business 101 class's widget-fact
Re: Waiting to hear... (Score:5, Informative)
M3 deliveries were about 2,5k higher than production this quarter, vs. 56k deliveries. S+X was almost identical to production. Given that the automotive margin is over 25%.... no, that was not a material factor. Furthermore: Inventory in Q3: $3,31B. Inventory in Q2: $3,32B. The given the higher ASP in Q3, undelivered inventory is more valuable than undelivered inventory in Q2.
Re: Waiting to hear... (Score:4, Interesting)
Or, ignore inventory changes and do the math. Multiply 2 1/2 thousand vehicles times a reasonable Q2 ASP - say, $55k. That's $137,5M. Compare that to the free cash flow ($881M) and profit (GAAP: $312M; non-GAAP: $516M). Notice anything?
Re: Waiting to hear... (Score:5, Interesting)
Fuck the cars, high end electric vehicles are a limited market. The big Tesla market, something the hedge fund shorts absolutely do not want to discuss, the home electric power systems, panels, batteries and control gear a far bigger market, probably something like 100 times the size of the vehicle market, each unit worth similar to a low end car and far more profitable, with numbers in the hundreds of millions. Yeah, keep talking Tesla vehicles and ignore the bigger market and the one far more damaging to the fossil fuellers.
Tesla home power systems, cut your house from the grid, invest in a higher return than bank interest, far higher and fuel your Tesla vehicle from home. Corrupt hedge funders who did the shorts are quaking because that home energy market is about to take off, no matter how much they bribed lobbyists to bring their pet SEC agents onto the scene.
Stupid (Score:2)
Re: Stupid (Score:2)
You can install more than one PowerWall. This is exactly what Tesla did in community centers and schools in Puerto Rico after the hurricane.
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Not if you want it to be cost effective. Powerwalls are way more expensive than a shed full of marine batteries. My brother lived off the grid for awhile, with a couple of solar arrays and a shed full of batteries. When he looked at the Powerwall, he laughed. Way less capacity than he had, costing an obscene amount more.
If you're into functional art, sure. Spend the premium. But if you want to affordably store power, Powerwall isn't the way to go.
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Market opportunity (Score:3)
Fuck the cars, high end electric vehicles are a limited market.
All markets are limited markets. That said the market for luxury vehicles is a very big market and Tesla is doing rather well in it sales wise. I don't think you would argue that BMW or Mercedes are tiny companies and Tesla is apparently out selling them. That's nothing to sneeze at.
The big Tesla market, something the hedge fund shorts absolutely do not want to discuss, the home electric power systems, panels, batteries and control gear a far bigger market, probably something like 100 times the size of the vehicle market, each unit worth similar to a low end car and far more profitable, with numbers in the hundreds of millions.
Possibly true but if Tesla doesn't get their car company scaled up they aren't going to have the finances to try to tackle the power generation market. They have to crawl before they run and the energy generation market is l
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Two other thing to consider are renters and repeat customers.
Not a lot of landlords are going to be interested in investing tons of money on home storage. However, lots of renters may be interested in an EV. (If they can figure out how to charge it.)
And you add home power systems to your home once in a lifetime. You tend to have something on an order of magnitude more cars.
Profit opportunities for landlords (Score:2)
Not a lot of landlords are going to be interested in investing tons of money on home storage. However, lots of renters may be interested in an EV. (If they can figure out how to charge it.)
Once there are enough EVs out there it's just a business opportunity for landlords. Provide the charging stations next to where they park and have them pay some sort of markup to use them. Any landlord with a brain in their skull would be stupid not to make EV charging into a profit making opportunity.
And you add home power systems to your home once in a lifetime.
I don't think the business model here is going to be one time installs, especially since the cost of the solar panels and battery will be tens of thousands of dollars. Probably will be some sort of rental o
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Only a loaded Model 3 Performance can get that high. ASP = Average Sale Price. Model 3 RWD PUP (the only variant they were selling in Q2) starts at $49k. Q3 introduced AWD and P as options. The other numbers come from the quarterly reports. 60k is rounding.
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Deliveries were 2.5k higher than produced.
The GP is napkin mathing the gross on those to point out that it was about half of profit (using the 55k number, using yours it's about 2/3's).
Basically, those 2500 cars make Tesla look MUCH more profitable, they must be relying on a lot of extra manufactured cars next quarter to not look like a huge drop.
Those 2500 cars made Tesla's profit significantly higher, and are easy to hand wave as insignificant being only 5% of sales.
Basically, Tesla cost shifted 100-150 M
Re: Waiting to hear... (Score:5, Insightful)
I doubt that.
The demand for gasoline range EVs with a huge quick charge network seems to be pretty high (see the way Tesla dominates at the price points they're able to make cars for leading me to believe that once one breaks the 250 or so mile threshold people relax a bit), and the model 3 hasn't even reached out globally, where EVs are doing pretty decent overall.
Tesla does seem to be poised to be a top tear EV manufacturer in the long run, and are likely demonstrating that they are worth investing in to stick around (debt not equity) at this point.
EVs are poised to be huge (once they become cheaper than regular cars, which will likely be in the next few years as gasoline engines continue to become more complex and EV components drop in price) and Tesla is poised to be a top tier competitor.
Do I think they're worth more than GM right now? no
I think at this point they'll stick around though, I won't be really confident until they have a smooth roll-out of a model though.
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EVs are poised to be huge (once they become cheaper than regular cars
They are pretty much there already. No, not in sticker price, but when you look at TCO, EVs are pretty much on par with ICE cars. It looks like the 5 year Model 3 TCO is on par with a Camry [cleantechnica.com] as long as the tax incentive is there. Without it, the Model 3 comes in a little higher than a Camry.
Re: Waiting to hear... (Score:5, Informative)
I went from spending around $600-$700 a month on gas to spending around $50 with my PHEV. I haven't changed my driving habit or route, it's literally the cost savings just in gas . The oil changes in my PHEV are every 10,000km or 6 months. I have yet to hit 10,000km on the gas engine yet - I'm at 36,000km in just over a year of ownership and the mileage on the gas engine is less than 9,000km. The gas engine still kicks on periodically (even when the battery is fully charged) because I think it's programmed to cycle the oil etc. every now and then.
Things Tesla owners have to worry about:
- Brakes (although less frequently due to regenerative braking)
- Battery pack (warrantied for 7 years minimum I believe)
Things Tesla owners don't have to worry about
- Engine oil & leaks
- Transmission fluid & leaks
- Power steering & leaks
- Engine coolant & leaks
- U-joints
- Exhaust pipe corroding
- Catalytic converter replacement
- Spark plugs and wires
- Camshafts, lifters, valves and anything else in a combustion engine
The list goes on and on.
Re: (Score:2)
It's not just gas savings,
That's why I specifically used the term TCO. That covers everything you just posted.
And missing from your list are brakes. Those aren't cheap, and regenerative braking is starting to stretch the lifetime of brakes to the lifetime of the car.
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On the brakes issue with hybrids or full electrics -- my 2008 Prius is still on its original brake pads, at a bit over 130,000 miles.
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I went from spending around $600-$700 a month on gas
Okay like seriously WTF! You use the term gas, so I assume you're American and living in the fantasy world of petrol pricing. I live in a different country to where I work and pay European prices for fuel and can barely reach half that when redlining my car down the autobahn for hours on end.
Do you drive an 8L V12 that is running rich and offering your services for Uber?
Re: (Score:2)
The US is not like Europe. Here's some math with a real world example to put it in context:
On average, lets say you work about 22 days per month. (4 weeks * 5 days plus a couple extra days)
Lets suppose this is a particularly bad commute of 90 miles (145km) one way. (I work with a couple people who do this, actually. No, I don't understand why either.) That's 180 miles per day, times 22 days, gives you about 4000 miles per month commuting. Assuming a 20mpg gas hog, (the US loves their giant SUVs [chevrolet.com]) that's 200
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Lets suppose this is a particularly bad commute of 90 miles (145km) one way.
Root cause identified. Most of Europe would consider that to be the actions of an insane person.
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I live in a rural location, away from the city but I wanted
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If it works for you, that's awesome! I have family who live in the city and absolutely love it, they need the convenience of being able to to wherever they need to get to. But it's not for me.
Also, I carpool with my wife so it's another hour or so we get to spend together
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Agreed. But for some people, being able to have a country estate rather than a tiny apartment or row house is more important than all of that lost time and money.
For the same price as a suburban house my grandfather purchased an old farmhouse twice that size, (7 bedrooms, 2 dining rooms, 2 living/entertaining rooms, etc.) along with 150 acres of land with five barns and a pond. He then proceeded to put a three hole golf course in one of the fields.
He was one of those insane people who would make a drive lik
Re: (Score:2)
Nope, about 40% of Europeans all concentrated in few major cities live in apartments, and a lot of them are far from tiny. My own apartment is bigger than an English house.
But that is completely irrelevant. One thing that is relevant is the relative distances between population centres within Europe which is far smaller than that of the USA (not surprising given the population density over the country) and that typically means reduced commutes, even for those people who don't live in the town/city where the
Re: (Score:2, Troll)
Correct, nobody wants overpriced golf carts.
People want gasoline car range, fast charging, and performance equivalent to a normal car.
More people want Model S's that want BMW 5 series, more people want Model 3's than want the BMW 3 series.
This is while EVs are a touch more expensive than the gasoline equivalent, that won't always be true (fewer moving parts will eventually lead to less expensive manufacturing).
There are very few people it seems that are concerned about the half hour charge per 4 hours drivi
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Re: Waiting to hear... (Score:2, Offtopic)
Huh. Then my wife got one hell of a discount on her AWD model 3, since we paid around $60k...
TL;DR: You are wrong.
Re: Waiting to hear... (Score:5, Insightful)
Completely contradicted by the report (whether you want to talk gross profits or net profits), but hey, thanks for playing.
Re: Waiting to hear... (Score:5, Funny)
By the way, did you ever save those children from the basement of that DC pizza restaurant?
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It may be sad that this is the most intelligent comment you've made so far.
Re: Waiting to hear... (Score:2)
So the documents filed with the SEC say something different than your bullshit based-on-nothing nonsense, so the filing must be fraudulent?
Some people will really say anything just to never say they are wrong, won't they?
Re: Waiting to hear... (Score:2)
And yet made a $300M profit somehow, even after repaying $80M in debt. Explain your statement, and show your work.
Re: Waiting to hear... (Score:3)
Revenue is recognized upon customer delivery. Do you expect a factory making 4500+ cars a week to instantly deliver them in 15 minutes like a pizza?
If they only had 2500 cars in inventory at the end of Q2 I'd say they aren't holding back much. That's only 3 or 4 days of inventory.
Re: (Score:3)
Revenue is recognized upon customer delivery. Do you expect a factory making 4500+ cars a week to instantly deliver them in 15 minutes like a pizza?
You know the car is fresh because the welds are still glowing!
Literally Hitler (Score:5, Funny)
Tesla deliberately held off shipping (and, by GAAP rules, recognizing revenue) in Q2 in order to make Q3 numbers look good.
I'm pretty sure your post is the part of the Hitler video near the beginning where he's waving hands and saying "This quarter doesn't matter because there's no way they can make next quarter because they deliberately held off shipping" and then the generals correct him, and he clears the room...
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Ha! I know what's going to be in my youtube queue tonight.
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It's okay, Steiner will counterattack and repel the Russians from the Berlin perimeter.
Mein Fuhrer...
Mein Fuhrer, Steiner was not able to find enough men to mount a counterattack.
Everybody leave this room now, except Yodel Krebs and Bugdorf.
Re: Waiting to hear... (Score:2)
Except every company says that, in every quarterly report, ever. Just like they open every call with a statement about how it's forward looking and subject to revision. People like you would sue them if they didn't.
Re:Waiting to hear... (Score:5, Informative)
Model 3 was ranked "Average" in reliability by Consumer Reports. For a first model year vehicle, that's not bad at all. It retains a "recommended" rating from CR. S was downgraded because they switched to making air suspension standard, and there were some air suspension reliability issues (which Tesla states their supplier has fixed).
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Those who finance the car are bound by the terms of the loan which always requires them to carry full liability insurance, or they reposes the car and sell it to someone else who can.
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I only paid $50K for my Model 3.
Ahhh, went with a lower end model, I understand.
Re:Waiting to hear... (Score:4, Interesting)
How many people can actually afford these vehicles when insurance and the like is added in?
So, my performance M3 was 1.6 times as expensive as my Subaru STi, and yet the insurance was almost exactly the same price. I actually asked them to double check in case they had made a mistake. They hadn't. Not sure whether it's the safety rating, or that it's not a boy racer car like the STi, but insurance doesn't seem to be a problem for most of the people I've talked with...
There are some problems (Score:5, Interesting)
I am a big Tesla fan. But we should acknowledge that there are still some problems. Mainly that the spare-parts supply chain hasn't caught up with manufacturing, leaving cars inoperable for months while Tesla's own shops wait for parts. If you want right-to-repair, Tesla hasn't caught up to that by making diagnostic tools available or parts available to non-partner shops and end-users.
Re:There are some problems (Score:4, Insightful)
As long as that doesn't affect people's willingness to buy new Teslas, those aren't really immediate problems for the company.
Long Term (Score:4, Insightful)
No, but they are long term issues that affect customer loyalty. There are rumblings amongst Tesla owners about service issues. In-warranty service is slow. Out-of-warranty is slow AND super expensive. Like $900 to fix a door handle. Dealerships are known for stiff markups, but $900 to fix a door latch is usury.
https://forums.tesla.com/forum... [tesla.com]
Re: (Score:3)
Usury (Score:3)
Cost to fix a Cadillac Escalade door handle (and latch mechanism) $430:
https://www.cadillacforums.com... [cadillacforums.com]
Can somebody count for me? (Score:5, Insightful)
I actually pay attention to all the Tesla/Musk/Tesla/Musk critics out there and follow their arguments about how the company is going to crash and burn and Musk is delusional and the technology won't work and the production can't work and the quality is crap gasoline is actually greener and cheaper and and the major automakers are going to bury them and the workers have reverted to savagery and yadda yadda.
I have been following all that for, what, five years now? How many portentous pronouncements of Tesla and/or Musk's demise has there been? I have lost count.
A few days ago my e-trade board delivered this little news nugget:
Citron Research, which has previously advocated short positions on Tesla, says it has changed course, and that the electric car maker is "destroying the competition, as Citron makes the case for why it's taking a long-term view.
So apparently there are short sellers out there will actually fold up the tent for another from-scratch assessment. Granted, they were wrong before so they could be wrong again. Tesla could still crash and burn or at least hit a major bump in the road. But if it does it will have nothing to do with what the chronic naysayers that post here say.
Re:Can somebody count for me? (Score:4, Insightful)
Tesla aftermarket is currently $316,80. 1 year ago Tesla was $320,87. You're comparing market close (aka, from before the Q3 report).
Tesla is one of the few major stocks that's doing well while the markets are getting hammered. As it should. In a recession, demand-limited companies (aka, most companies) suffer, but supply-limited companies (like Tesla) thrive. Life actually gets easier for them, as their feedstocks, parts, shipping, contractors, etc all get cheaper.
That statement doesn't match the term (Score:5, Insightful)
TSLA longs lost over 17%
While they may be DOWN by that much (but are not, see aftermarket) by definition "longs" have lost nothing... because if they are long, they are holding not selling.
I bought some shares in the middle of the year but I have "lost" nothing because why on earth would I sell? The end game is way north of $400, by the end I will have made quite a lot on TSLA (and some of it I bought longer ago when it was a lot cheaper).
As a long investor what I do is pick stocks that I think have lots of potential, put money into them, and maybe look a few times a year to see how things are going. That's how you long, not bailing out at the first sign of any dip. If you choose well the dips fade away and you have mostly growth across a portfolio. Maybe someone doing day trading is making more but I'm pretty sure I'm leading a less stressful life.
Re: (Score:2)
Re:Can somebody count for me? (Score:4, Informative)
Not any longer.
Terrible consequences (Score:4, Funny)
Well, shit. Looks like LynwoodRooster is going to have to come up with a whole new series of anti-Tesla rants to copy & paste into Slashdot Tesla stories.
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Strange that they are completely silent, no?
Yeah, this is my surprised face: :|
That tool has been willfully ignoring reality, and now has to have a small cry before it can resume posting.
Act of Faith (Score:3)
Made a very good point about efficiency (Score:5, Interesting)
Elon also said "I begged the other companies to invest in battery capacity and charging networks" according to some live blogging site. And some thing along the lines of if they make an adapter he will let them use Tesla super chargers. Not sure if he really said that or these guys are putting words in his mouth.
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And Tesla makes batteries cheaper than anyone else (I think about 25% cheaper) that gives Tesla the edge and competitiveness.
Any source on the 25% cheaper battery cost? A recent guess [seekingalpha.com] deduces that Nissan manages lower-cost batteries.
Maybe once Gigafactory finishes ramping up, they will be the cost leader.
Re:Made a very good point about efficiency (Score:4, Interesting)
The last Monroe tear down (the second one where he blasted Tesla for a dumb design of the body, that would cost 2000$ more to manufacture compared to others) said that the battery pack innovations (gluing cells to the wall of the cooling conduits etc) and the fully integrated mother board, and the wiring that allows charge current to be rerouted dynamically, individual cell level monitoring etc are way ahead of the competition.
Last time I saw the plots, battery costs are trending low for all, with about a seven year half life, for all. The curves are parallel. But Tesla is shifted down by a constant amount. Since the curve is very flat, almost horizontal, it gives Tesla a three year lead over others.
Tesla claimed 130$ /kWh at pack level and 100$/kWh in the last quarter call. It has suggested breaking the 100$/kWh barrier any time soon. But did not say whether time scale is our time scale or Elon(gated) time scale :-)
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Tesla and Elon have repeatedly stated that any other car company is welcome to use their supercharging network, given a) they develop their own adapter and b) they pay into the network proportionally to how much energy they use. seems like a great deal to me -- access to a huge network of chargers, and they dont have to pay for the creation of that infrastructure or its upkeep, just the power they draw from it.
the only company so far to approach them about this offer is Bollinger Motors, small NYC electric
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my sense is that pure egotistical refusal to acknowledge Tesla's success and significance is the primary reason none of the major manufacturers are interested in taking advantage of the only existing high-speed charging network.
My senses is they thought "We don't run gas stations. Why would we run charger stations?"
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Yeah, not sure what cars he's talking about. My Honda Fit EV got 4 miles per kWh if you drove normally, if you really worked at it you could get 6.5 miles per kWh... No way the Tesla could do that... But I'm happy with the ~280-300 Wh/m I'm getting on my M3P+... It's a lot better than the 19 mpg I was getting with my Subaru STi...
He probably is talking about some of the newer cars like the Jag... whatever...
Wont go bankrupt for at least six months. (Score:4, Interesting)
so M3s is overpriced? (Score:2)
TLDR the financial report but if the 25.8% gross margin on M3s is much above car maker standards, does it make M3s overpriced?
Does this profit margin include R&D and other operational overhead is it it just based on BOM and mfg?
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Re: so M3s is overpriced? (Score:2)
Every single one leaving the factory is bought and paid for, with a list of people that want to hand over money for one. That basically proves it is not overpriced, as the market seems to love the price it is at and the value it represents.
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There are many out there who genuinely wouldn't prefer to drive a Bugatti
To be fair, most of us couldn't afford to drive one.
It's not even the fuel costs, wait until your tyres wear out. It'd be cheaper to buy a new car.
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The other issue is that there are very few used Teslas for sale. If you want one, you're most likely going to have to buy new. In another 5-10 years, there will be plenty of used ones. My guess is that will drive down demand and thus price a little as well.
Tesla deliberately being discredited as a company. (Score:1)
Don't think this is happening then look what Ford has done lately. Like what happened with the Apple iPhone and Samsung going with the same trendy design, Ford Motors did the same bullshit with the Tesla model s. If you look carefully at a 2009 Tesla model s and compare it to a 2009 Ford fusion you see that they are different animals altogether and have little in common style wise.
Then suddenly the look and idea of no petrol with a Tesla s got sexy and Ford essentially cloned the look of a Tesla model s in
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The problem is that W/O did all the wrong things. We SHOULD bail them out again, BUT, this time, break these companies up. IOW, rather than having 2 car companies, we should break them up and have 8-10. That way, it will not happen again.
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Actually, I believe that both GM and Ford will bankrupt. Again (and yes, when you are obtaining massive loans from the gov, then you bankrupted).
Ford didn't need the loan. GM did. GM bankrupted, Ford didn't. GM has been spending its time, money and effort over the decades building synergies and then throwing them away. e.g. Detroit Diesel and Allison.
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However, they would not have survived without it, while other companies were getting their handouts.
The ONLY company that was not bailed out, but was working in America, was Tesla.
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THE BELLS! THE BELLS!!!
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Claiming to not be convinced by overwhelming evidence is not a particularly effective way to prove that evidence wrong.
Re: "today Tesla put the doubts to rest ..." (Score:4, Informative)
Standard short conspiracy theories.
1) Tesla only delivered about 2 1/2 thousand more vehicles than they produced this quarter (due to issues related to timing the tax credit expiry). Doesn't even remotely come close to the profit this quarter. Furthermore, they were lower ASP vehicles than the ones held up in delivery delays this quarter.
2) Tesla, like all companies, has had varying disputes with suppliers. The grand total in Q3 was, if I recall correctly, around $8m. I mean, stop the presses.
3) Tesla's loaner fleet is still very much intact. It periodically sells off older vehicles and replaces them with newer ones.
4) "They haven't made a profit" - Hmm, what's that river in Egypt....
5) "They will lose money when their debt payments come due" - Yeah, they made that much free cash this quarter alone.
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The profit number also completely ignores 2 and 3.
2) Not paying vendors doesn't mean you don't account for the bill, it simply means it may adjust in the future.
3) Selling a loaner fleet is revenue neutral it's trading asset for cash, if there was profit in it it just means the loaner fleet was undervalued before, it's still legitimate profit.
The 2.5k cars does dramatically shift the numbers, but not enough to tank the company (2.5k * 60k is about half of the profit), also, there could be sins hiding in tha
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As others have pointed out before it can definitely be unethical. The ethical issues arise when people with a vested interest in the stock price attempt to manipulate the price usually via FUD, although the same can also be done by trying to pump and dump. The harm in these kinds of actions is that a companies ability to borrow money and get favorable financial terms from suppliers and such is directly affected by the stock price. That kind of instability can wreck a company that would otherwise be just fin
Re:As usual Rei is misleading. (Score:5, Informative)
False. Tesla has $157M due in December, and another $920M due in March.
Meanwhile, production keeps rising. If you're betting on a "Christmas slowdown" to save you, keep dreaming.
This is only just starting. Fremont scales to at least 7k without new lines (confirmed not just by Tesla, but also analysts who've toured Fremont). Model 3 is designed for 25% margin at its full range of variants. I mean, what exactly did you all think would happen to margin over time? Shorts kept complaining about high scrap rates and excess labour requirements - did you think it would remain that way forever? It takes a long time to get those things down (Tesla is still slowly reducing production costs on the Model S), and reducing them equals margin. With the introduction of the MR, margin improvements will get eaten up by a lower ASP in Q4, but in Q1 you not only get further margin improvements, but also a higher ASP due to the start of high-end sales in Europe.
Seriously, what exactly did you all expect was going to happen?
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ED: Correction, that should be $230M this quarter, not $157M.
Re: As usual Rei is misleading. (Score:2)
No. 1.15B in two quarters.
You know a quarter is only 3 months right? And there are 6 months between October and March, inclusive?
This isn't hard fucking math, but you keep shutting the bed on it.
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As I pointed out previously when you asked for a citation, the important date for the convertibles is Dec 31 where the covenants require a set level of cash.
(Btw, has to be said that the Citron manipulation was a very nice addition to the usual pre-earnings pump, didn't expect that at all. Usually only play 10% otm calls going into earnings. But in this case will be adding some common on top this morning because the poo stew of accounting is so delicious this quarter.)
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You're thinking about production only."
are you considering the thousands they have on back order? Any sales over teh slower christmas will generally go to the back of the queue. It might be a "problem" if their order book was empty.
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Also this now makes 3 profitable quarters out of 31 since becoming a public company, let's see if they can make a sustainable profit. Bit early to be jubilant.
But they are at least cash flow positive. That's a nice change, and does help them substantially - whether it's enough to cover the near term commitments is less important than the confidence it will give the people they might approach for further loans or investment.
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I've been kind of hoping that they would partner with or buy up Lit Motors https://en.wikipedia.org/wiki/... [wikipedia.org]
The C-1 concept is pretty cool in my opinion. The C-1 might not have the sex appeal of a standard motorcycle but would be eminently more practical for daily use and much safer.
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I'd thought the Model X was a crossover, but I guess it just looks like one rather than being the size of one.
What Tesla needs to build right now is a wagon, which is what most crossovers are. The fact that there's enough people sleeping in their Teslas to merit a "camping mode" proves that they need to make one that doubles as a bed.
I think the really exciting product will be the eventual, inevitable Tesla minivan. All the weight is down low, so it will handle in spite of being a tall box. And it will have enough room to basically live in if you're small. I think that's the product that will really sell like gangb
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I think the really exciting product will be the eventual, inevitable Tesla minivan. All the weight is down low, so it will handle in spite of being a tall box. And it will have enough room to basically live in if you're small. I think that's the product that will really sell like gangbusters.
The Model X is a mini-van. No matter how it is publicized it is not an SUV it is a minivan. No off-road capability. No roof-rack.
But it does have a lot of room inside and it has great performance. Great for soccer moms and real estate professionals who have to drive clients around. For "sports" and "utility?" No.
It is selling pretty well.