Tesla Turns a Profit For the Fourth Quarter In a Row, Chooses Austin For Next Gigafactory (theverge.com) 163
Tesla turned a profit of $104 million in the second quarter of 2020. "As a result, Tesla has now been profitable for four straight quarters for the first time in company history -- an elusive benchmark the company has long sought," reports The Verge. The company also announced it will build its newest Gigafactory near Austin, Texas. CNBC reports: The area takes up about 2,000 acres and will be roughly 15 minutes from downtown Austin, Musk said. He said the factory will be an "eecological paradise" and that it will be open to the public. "We're going to make it a factory that is going to be stunning it's right on the Colorado River. So we're actually going to have to have a boardwalk over you, hiking, biking trail. It's going to basically be an ecological paradise," Musk said. The site will be used to build the company's Cybertruck, its Semi and the Model 3 and Model Y for the eastern half of North America, Musk said. Musk also added that Tesla will continue to grow in California, where it will build the Tesla Model S and the Model X for global deliveries and the Tesla Model 3 and Tesla Model Y for North America. Travis County, where the new car plant will reside, voted earlier this month to give Tesla tax breaks worth a minimum of $14.7 million to build the plant to bring jobs to the area. Tesla employs about 10,000 people at its only U.S. car plant today in Fremont, California. The Verge reports on the finances: Tesla kept its finances in the black by selling 90,650 vehicles this past quarter even with that factory shutdown -- an increase over its first quarter pace of 88,000 cars delivered but still below the company's record of 112,000 in the fourth quarter of 2019. This helped the company generate $6 billion in revenue, buoyed by $370 million in energy storage sales and $487 million in services revenue. Elon Musk has promised that his company will deliver 500,000 vehicles by the end of 2020, and the company maintains that is still possible. Tesla says it's installing "additional machinery at the Fremont Factory, which is expected to increase total Model 3 / Model Y capacity from 400,000 to 500,000 units per year."
Whelp (Score:2)
Gotta be honest, I was sure they'd fail to ever do that.
Re:Whelp (Score:5, Insightful)
It turns out that there exists a large lucrative market for electric vehicles. This issue is that most people want their electric vehicle to look like a normal car instead of looking like a clown tin can mobile such as the BMW i3 (I swear, I have seen the joke of that electric car maybe twice on the US roads). They also want the vehicle to have a decent range. Tesla delivered just that, and won a lot of sales.
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This issue is that most people want their electric vehicle to look like a normal car instead of looking like a clown tin can mobile such as the BMW i3
I hadn't actually seen that vehicle until I looked it up just now. It looks like a giant Hot Wheels car.
https://en.wikipedia.org/wiki/... [wikipedia.org]
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They took over from the Aztek for ugliest car ever made.
They are even uglier on the road than they are in pictures.
Wat (Score:2)
They give BMW mod points now? Or was that the proud Aztek owner?
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They took over from the Aztek for ugliest car ever made
Clearly you've never seen a banana-yellow Aztec.
Re: Whelp (Score:2)
I always referred to that one as the Asstech because when you were driving behind one it looked like you were driving behind a huge ass.
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You'd be amazed at how popular this size and style of car is. Toyota Aygo, Smart fourtwo, Citroen C1, Renault Twingo, VW Up! (yes with exclamation mark) are all equally clown cars and very popular in Europe.
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If I lived in Europe I'd probably want nothing bigger than a VW Golf myself, just because they are far easier to find a parking spot in a city, and easier to get through the older narrower streets that exist in parts of European cities. And a Golf is huge compared to a few of the ones you've listed.
By the way, each of the vehicles you listed is a far more attractive design than the i3 - the i3 is just hideous and should be put out of it's misery. I will say that the one novel thing that BMW did with that
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There's one in our neighborhood, unfortunately he still drives like a typical BMW owner. Fortunately the number of Teslas should pass the number of Beemers soon, at least in Bellevue.
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Car guys conversations:
You know the problem with Today's cars, they all look alike. Other than the Hood Ornament, you can't tell which is which.
Car Maker makes a unique Car:
What were they thinking, that doesn't look like a car/truck. This thing is ugly as sin. Why don't they make the car look like other ones.
The thing is, BMW i3, The Pontiac Aztek, and the Upcoming Cybertruck are not necessarily ugly, they do confront your expectations which triggers your disgust emotion. However if you allow yourself to
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Yup. And then Tesla saw that they needed high-speed charging for travel, so they built their own charging network. In the US, it's really the only good national option right now, and it's a huge advantage for Tesla in the marketplace. And then Tesla saw that self driving was the next big thing, and is in the forefront there, too. And getting over-the-air updates and other efforts to maximize the customer experience help, too.
In short, Tesla is doing pretty much everything right while most other companie
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This issue is that most people want their electric vehicle to look like a normal car instead of looking like a clown tin can mobile such as the BMW i3
Okay, but then explain Tesla's pickup.
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Oh, well, the key difference is that the cybertruck is stainless steel, not tin - worlds apart!
(Though, to be pedantic, most "tin" cans aren't actually tin; they're steel [wikipedia.org]. These days, they're usually not even tin-plated/i>.)
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I'd buy one.
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Musk has actually claimed the release version is going to look like the prototype.
Re: Whelp (Score:2)
Strangely, you don't have to look far to find its fans, so I wouldn't be all that surprised if it does end up selling decently enough. It's specs are both amazing and believable given the performance of Tesla's existing fleet, and I would be otherwise interested in one if it weren't so hideous.
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I am one of these fans of its design. Yes at first I was a bit put off, however I put in a reservation the day after I had 2 cars cut me off within 5 minutes, like my little car didn't exist. At that point I decided that my replacement car needs to be something noticed and a bit feared on the road.
However from is specs, it will have the Ride of a Luxury car, the performance of a sports car, ecological like a Prius, carrying capacity of a Pickup Truck, and the strength of a military vehicle.
Also if you lo
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I swear, I have seen the joke of that electric car maybe twice on the US roads
Which doesn't surprise me given how many BMWs in general you see on US roads. I probably see one on a weekly basis here in Europe. What you consider a normal car and what much of the rest of the world does are two different things. The i3 isn't nearly as clown carish as many even far more popular cars such as the Smart fourtwo, Toyota Aygo, Citroen C1 (we measured it, this car fits on the tray of a Ford F350), the larger and more normal looking Renault Zoe (which has well and truly outsold Tesla until they
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We see BMWs on US roads all the time. They sell thousands of cars here a month [yahoo.com], though absolutely not the i3 where they manage to sell ~20 a month in North America according to the link.
There's a few charts here [goodcarbadcar.net] that really tells the story of why Tesla is still profitable though - they're the only company in North America with actual YTD sales growth right now, and most all other brands are taking a double-digit hit to their numbers.
As it turns out, Tesla has figured out how to make an EV that people want
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As it turns out, Tesla has figured out how to make an EV that people want to buy, and so people are.
I didn't dispute that. Please re-read my post. Point is Tesla figured out how to sell cars *Americans* want to buy. The i3 outsold the Model S by a huge margin in Europe.
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Point is Tesla figured out how to sell cars *Americans* want to buy. The i3 outsold the Model S by a huge margin in Europe.
The i3 and the Model S are about as comparable as a Vespa and a Ducati. The apt comparison here is between the i3 and the Model 3. The Tesla Model 3 is the world's best-selling electric car in history. [wikipedia.org] The Model 3 was also the top selling plug-in car in Europe in 2019 (the first year of deliveries), outselling the i3 by almost 3 to 1. [carscoops.com] In Norway and the Netherlands, the Model 3 was not only the top selling plug-in car but also the best selling passenger car. The Model 3 was the 2nd best selling car of a
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If that was all they wanted then they would buy a much cheaper Kia or Hyundai or Nissan (the new Leaf has conventional looks). Teslas are like Apple products, they are good but also over-hyped and over-priced by a reality distortion field.
Re: Whelp (Score:2)
Over hyped? Please point to a commercial advertisement for a Tesla product.
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I'm not sure about that - I own a Leaf, because it's good enough for most of what I want a car to be, is fully electric, and was reasonably cheap. But I also still have an ICE. If I was just going to have one vehicle and it was going to be an EV (and personally, I would rather be all-EV from here on out), it would need to be a Tesla. In terms of an EV which can be used like an ICE in the US context, there's really not much else as good yet, and the Supercharger network seems to be the best thought out netwo
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The Model 3, Model Y and future Cybertruck (which some say looks like a joke) Come in at a competitive price for equivalent ICE cars, you still pay a little Extra because it is EV but it is in the same ballpark for the Middle-Upper Middle Class folks. Where People in their Late 30s and up can afford to have their mid-life splurge. And get something nice, that they can afford.
While Appearance is part of the equation, but I expect it is a small factor from the number of Preorders from the Cybertruck. I do
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Which you have stated many times for many months, without ever offering proof.
Show proof, or get the fuck out.
Re: Whelp (Score:2)
He's probably a tslaq. Their tears were very delicious on the day of the manned SpaceX launch.
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Was inevitable (Score:3)
Disclaimer: I do not own a Tesla, but I have friends that do.
Tesla has just been so obviously ahead of every other car maker in terms of a well-rounded electric car for some time - and from all signs widening the gap.
Watching the tech demo on self driving a few years ago really capped it I thought. Who else is doing such extensive custom hardware for cars like that?
Anyway, it's great to see a company with real vision actually thrive like this - especially seeing SpaceX do so well as well.
Tech inversion (Score:5, Informative)
Disclaimer: I do not own a Tesla, but I have friends that do.
Tesla has just been so obviously ahead of every other car maker in terms of a well-rounded electric car for some time - and from all signs widening the gap.
Watching the tech demo on self driving a few years ago really capped it I thought. Who else is doing such extensive custom hardware for cars like that?
Anyway, it's great to see a company with real vision actually thrive like this - especially seeing SpaceX do so well as well.
(I own Tesla stock and am bullish on the company.)
Tesla is riding something called a "technological inversion". That's where a new technology comes in and completely replaces old technology.
Here [insider.com] is a photo of 5th avenue circa 1900, and here [insider.com] is 5th avenue in 1913. (source [businessinsider.com]) The first photo shows 5th avenue all horse-drawn carriages, and one automobile. The 2nd photo shows all automobiles and one horse carriage.
Those photos were taken only 13 years apart!
We've seen tech inversions before, on both a large scale and small scale. Good examples of the small scale inversions are all the various hard drive tech improvements over the last 30 years - which drove a lot of drive manufacturers into and out of business. Now it's all SSD technology, which is yet another inversion.
Electric vehicles are now mainstream and superior to ICE vehicles in every way, including total cost of ownership. There's no way Tesla will be able to keep up with production - for at least 5 years they will be production limited.
This has some ramifications for the stock price:
1) Some analysts believe that in the future, people will choose between a Tesla and ICE vehicles from other manufacturers such as Nissan and Ford. This is incorrect: Teslas are superior in just about every way to any ICE, and will only get better with future improvements. ICE development has just about reached the end of what's possible in terms of reliability and efficiency.
2) Some analysts believe that Tesla is doomed once the big players realize that there's a market for electric vehicles. This is also incorrect: for Ford or GM to start making EVs would require a massive retooling and massive rethinking of their design process, which they are completely unwilling to do. Several "Tesla killera" have come and gone already. Has anyone seen a Taycam on the road?
3) Some analysts believe that Tesla stock is a bubble, because of course a meteoric rise in stock price has to be a bubble because there's no other explanation. In reality, unlike tulip bulbs a Tesla has considerable intrinsic value and utility, so it's just about inpossible that the company stock could crash hard enough to put it out of business.
4) Everyone who owns a Tesla has commented that there a zillion little design choices that make the vehicle such a pleasure to own. The vast majority of these improvements could have been implemented by the big players in their current vehicles - but for some reason they chose not to do so. Even if the big players start coming out with EVs, it is highly unlikely that their offerings will reach the design quality of a Tesla any time soon.
5) Tesla is currently the leader in autonomous driving. Autonomous driving logically separates into two sections: object recognition and decision action. The AI object recognition algorithm accuracy is known (in the AI field) to scale linearly with the amount of input data. Tesla currently has just shy of a billion miles of recorded and labelled input data to feed its algorithms, and the nearest autodriving competitor (Uber, IIRC) has about 1.2 million miles of data. With 1000-to-1 factor if training data, the Tesla algorithm has a far lower error rate than any compet
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(Disclaimer: I own a model 3, and am a complete fanboi. With the exception of the sub-par paint job (black in my case), I think it's the BEST car money can buy)
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Regarding point 1, I don't disagree however there was that recent Porsche post about 3d printing some advanced piston designs they couldn't make conventionally getting an additional 30 hp. It would be intriguing to see what gains might be possible in ICE vehicles using the tech but I would agree the gains would likely be expensive and limited compared to the continued improvement of EVs. My next car is going to be an EV, whenever that need arises. Honestly, I'm more curious to see what improvements the 3d p
Re:Tech inversion (Score:4, Informative)
This is also incorrect: for Ford or GM to start making EVs would require a massive retooling and massive rethinking of their design process, which they are completely unwilling to do.
GM already makes EVs. They make the Chevrolet Bolt, which competes with the Tesla Model 3. Ford has an EV coming out in the near future, the Mustang Mach-E. It will compete with the Tesla Model Y.
Several "Tesla killera" have come and gone already. Has anyone seen a Taycam on the road?
The Taycan is simply uncompetitive, but the lack of them on the road is more due to production issues than demand. It's been in production for less than a year, and as of March, they had 15,000 orders plus an even larger number of pre-orders. If you compared Taycan orders and pre-orders from the end of 2019 versus their overall production in 2019, the Taycan would have represented in the ballpark of a tenth of all Porsche cars.
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The Taycan is one you buy for the Porche brand and a car that is more luxurious inside.
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GM already makes EVs. They make the Chevrolet Bolt, which competes with the Tesla Model 3.
Competes?
In what world does an overpriced econobox compete with a luxury sedan? Do you believe that a Honda Fit competes with a BMW M3 just because they both run on gasoline?
Re:Tech inversion (Score:4, Interesting)
GM already makes EVs. They make the Chevrolet Bolt, which competes with the Tesla Model 3...
The Bolt is more an LG Chem car than a GM one. The battery pack, motor, inverter, charger, climate system, power electronics, instruments, infotainment are all made by LG chem. If the GM plan is for somebody else to make their cars, this will have a huge impact on their profits.
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The Bolt's problem is that unless you are a thin and not very tall person, you can't seat comfortably behind the wheel.
Also it's chairs give you all the comfort of a plastic bus station bench.
You cannot fully compare the Bolt with the Y. The Bolt is also comically tiny for the US Market.
I really wanted a Bolt until i saw one in the show room and got inside.
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The only place the Mustang Mach-E competes with a Model Y is on paper, with many asterisks.
Seriously, there is so much vapor [forbes.com] coming out of Dearborn on that thing it's not even funny.
"Oh yeah, we'll have a 300 mile range* on an available trim version"
"Yep, we'll do 0-60 in 3 seconds and change* on the GT"
"Sure, we'll have self-driving* as an over-the-air update"
*someday
All for basically the same price in theory later this year, instead of a car that is shipping since March. So, with Ford's vast experience w
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Why do you think the Taycan is uncompetitive?
Range is good, it is the fastest charging EV available (faster than Tesla), and it handles exceptionally well (reviews rate it better than Tesla). In Europe it has a charging network too, Ionity, I don't know about the US.
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I'll use American numbers just because it's easier to find the specs in imperial units.
Based on the price, it's presumably competing with at least the Model S. Let's pick the base model Taycan Turbo as a comparison point, which costs $152,250. The closest priced Model S is the Performance, at $94,990, which is the most expensive base model that Tesla makes. So already the Taycan costs 1.6x as much.
Using the EPA range estimates (so that we're comparing equivalent methodology), the Taycan at that price gets 2
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I mean, I don't want a Tesla. The touchscreen as an interface is a hard-no from me. And an ICE has way lower TCO (esp. since I can repair it or get it repaired by a third=party).
As for accumulating driving data, that is valuable. A billion miles! If Ford starts putting sensors in the new F150 it would take them a whole month to get a billion miles of data. Meanwhile, as you brag and point out Tesla is updating their sensors. Which means all that data is no longer useful for their new learning.
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And an ICE has way lower TCO (esp. since I can repair it or get it repaired by a third=party).
We've had our Model 3 for a year and a half, a bit more than 20,000 miles, and have needed no service whatsoever so far except changing summer/winter tyres (which any tyre center can do, or you can do yourself). Maybe we'll take it in for a first service some time next year when we feel like it. They recommend an annual checkup but it's not really required and does not affect the warranty. They don't even send reminders for it. The only major points to check are hydraulic fluids (usually OK for 3-5 years) a
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Your TCO calculation is wrong. [loupventures.com]
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The price of gas has plummeted since that calculation. Also, it's based around buying a new car and then selling it five years later. They explicitly did away with the lease calculation (because it made the Tesla look worse). But if you're buying used, leasing or buying new and holding for a while, then their numbers shift away from the Tesla. Or if you don't pay sticker price on the Camry and negotiate like you should. Good luck negotiating over the Tesla.
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I was in the same camp. Physical controls or nothing. Turns out that the buttons and jog on the steering wheel and the two stalks do 95% of what's needed, and you can do up to 98% with voice commands. ...")
The only stuff i still use the touchscreen for while driving is:
- Navigation (or you can say: "take me to
- Seat warmers in winter (or you can say: "my butt is freezing")
- AC temp up/down (also works with voice commands)
- Calling someone ("call John Doe")
- Save current video recordings to USB stick (no voi
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And an ICE has way lower TCO
As well as a Tesla, I have owned a 10 year old Nissan Leaf for the last 2 years. It is used daily for the nanny to take my daughter to school.
Over the last 2 years, it has done about 5000 miles, with an electricity cost of £65 or so (we have quite a good rate for night time power here)
The maintenance cost has been minimal. New wiper blades were the most expensive thing. I probably spend more on the car wash than everything else put together.
My Tesla has been to Bratislava and back 3 times in the last
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In the US our electricity is more expensive and our petrol cheaper. Cost-wise 15.6 kilowatt hours ~= 1 gallon of petrol. Mileage-wise 33.3 kilowatt hours ~= 1 gallon of petrol.
Meanwhile, for me,, ICE+maintenance hasn't overcome the initial cost difference
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This is also incorrect: for Ford or GM to start making EVs would require a massive retooling and massive rethinking of their design process, which they are completely unwilling to do.
You conflate unwilling and unable. The latter is absolutely false, the former is absolutely true. Retooling is easy. Expertise can be paid for. But vision... that needs to come down from the top: https://www.dw.com/en/daimler-... [dw.com]
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Excellent, insightful post -- but as a Tesla owner myself? I'm going to have to temper all of this with a few other considerations....
1. One of Tesla's serious issues that they hide well from the general public is a lack of customer service/customer care. They've really tried to embrace the idea of "efficiency" by eliminating your ability as a customer to pick up the phone and talk to someone when you have a problem. They want all interactions for scheduling service to happen through the web site or the app
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Electric vehicles are now mainstream and superior to ICE vehicles in every way
Ehhh.... I'm going to debate that as maybe over-exuberance I hear from lots of Tesla stock holders. I know the technology pretty well, and it will be great to own one someday, but would I even consider one as my primary vehicle today? Not a chance. I'll be leaving today to drive 3 hours into the wilderness for camping, where there is no place to charge. Now, I might be able to find some way to make that work with an EV for sure, but clearly there is an example of how ICE's are superior.
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Tesla failed to produce an affordable EV, while others did. Teslas are very nice IF you can afford them, but the credit should really go to people like Nissan and Kia and Hyundai and Renault who made affordable, good cars.
Yes the Leaf isn't as exciting as a Tesla, but it also costs about half as much. It's actually a viable money-saver for a lot of people.
By the way, whatever that self driving demo was, Tesla has consistently failed to deliver and every single prediction has been wrong. I think it's really
Question: How is it that Musk is so intelligent? (Score:2)
Elon Musk is a top-level leader in other areas, also. One of the many stories: Elon Musk's Boring Company wants to hold its first tunneling competition [cnet.com].
Elon Musk is the founder, CEO, and CTO of Spacex [spacex.com]. Wikipedia: Space Exploration Technologies Corporation [wikipedia.org].
Elon Musk is the most inspirational leader in tech, new survey shows [cnbc.com]. The others listed are NOT NEARLY as capable and inventi
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Thanks! (Score:2)
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Re:Question: How is it that Musk is so intelligent (Score:4, Interesting)
Elon bought into interesting companies. That's cause he started with capital. Easy to be "clever" if you don't have to invent anything and just invest in what sounds cool.
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he's pumping vast amounts of money into his rocket company
I've heard it was one billion a year, if you want to call that vast, fine. Maybe BO will finally launch something to actual orbit someday. But even with that pokey rate, BO will probably be the only rocket company anywhere near SpaceX, since nobody else is even trying for re-usability; at most they're doing minimal efforts like dropping the engines with a parachute...on paper.
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I've heard it was one billion a year, if you want to call that vast, fine.
I call it vast. That's more than nearly all countries spend on their space programs. Canada spent just $332 million on their space program for their most recent fiscal year, and they actually build space hardware that's operational on the ISS. In point of fact, Jeff Bezos spends more on Blue Origin than every single space program in the world except the US, China, the EU, and Russia (in descending order of budget). And he's spending the same order of magnitude as China, the EU, and Russia, who are spend
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He made a small fortune from his first startup, pre X.com. Which was primarily (75%) initially funded by his dad. He worked at PayPal for around a year before being forced out. Even after he was forced out he continued to invest in later raising rounds making his stake eventually worth $250MM. (not a billion). But yeah, as paypal grew, the ability
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His roof tile business isn't doing so well.
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it's almost like doing something completely new and disrupting to a market might be hard.
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Maybe. But his Roof Solar Panel one is bringing in money like crazy - The price of a Tesla Solar system + PowerWall is sometimes cheaper that just the Solar panels from other vendors on the market at the moment.
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He isn't - He had one idea - don't outsource, in-house as much as possible it's cheaper and you can change designs quicker
This is why his companies can change quickly and produce cheaper goods
Tesla is still 13.8Billion in Debt
The Boring company may never turn a profit
SpaceX is not designed to make money
His first big success was PaytPal - he had almost nothing to with it
Tesla was not his - his one idea and lots of PR made it profitable
SpaceX his one idea made it work
Quid Pro Quo (Score:3)
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I hope they do. Texas is the 5th in the list of Tesla ownership & sales - which is amazing - considering you have to pay full sales tax for a Tesla (reduced tax for all other cars sold by in-state dealerships), you don't qualify for the Texas EV rebates (all other dealer-sold EVs and Hybrids do qualify) and it takes up to 2 months to get a Tesla registered.
And to cap-it off, Teslas are the only new vehicles that are forced to pay for the emissions tests after the 1st year of ownership (all other dealer-
Stock price is over valued (Score:4, Interesting)
But the stock is over priced. Some odd combination of convertible bond hedged shorting, FOMO players buying crazy call options, and some really long investors who don't seem to sell at any price has created some strange effect. Simply buying deeply out of money call options raises the stock price by unexpected amount. Delta hedging by market maker or something they are calling it. So someone, may be fan bois may be manipulators, may be the insiders, buys way out of the money call options, and the stock price goes up.
Tesla has sold so much of Full Self Driving at 5000$ to 7000$ a pop. But that revenue is not "recognized" because the feature has not shipped yet. All Tesla has to do is to sincerely believe 10% or 5% or 7.234% of the features have been "delivered". It can bring the revenue in, almost all of it shows up as profit. So it can choose to have any profit or loss it wants. This time around they decided to have enough profit for this quarter to make it eligible for entry in sp500.
Buy the car. Great decision. Great product.
Buy the stock,. I am not very sure that is a great thing to do.
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This time around they decided to have enough profit for this quarter to make it eligible for entry in sp500.
I understand that a lot of pension funds buy essentially the SP500, so now Tesla stock will be included in those funds buying schemes. What that leads to is not my field though.
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And it still won't. You clearly don't know what a ponzi scheme is.
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Even Elon himself has tweeted that the stock was too high when it was around $800. I love our Model 3, and I firmly believe in the company, but this is getting silly.
$400m in "credits" (Score:2, Interesting)
Let's not forget the over $400 million they got from other auto makers in "CO2 credits".
It's always good times when your buddies in the government put their thumb on the scale.
Disclaimer: I own a model 3. Great car. A little pricey but not by much. The company however is a scam and certainly not worth more than Ford, GM and Toyota combined. That's just silly.
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Let's not forget the over $3.3 billion that Costco got last year in "membership fees".
The emission credit money isn't coming from the government, and they'd be fools not to take what they can get. The credits are still only around 7% of their total revenue.
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Let's not forget that it's still revenue, and that if those other auto makers could manage to make zero emissions vehicles that anyone actually wants to buy, they wouldn't have to buy credits from their competition.
Why do you get to diminish some line item on Tesla's P&L sheet, but not say "service revenues" on GM's sheet - make shittier cars that break more often, and you get to sell more parts and service!
All that being said, their stock price is a fucking joke. It should be less than half of what it
Technically they lost money (Score:5, Insightful)
For those who don't know, California has had a Zero Emissions Vehicle mandate [ucsusa.org] for about a decade now. A certain percentage of each automaker's vehicle sales must be zero emissions (the actual formula is a lot more complex and includes PZEVs like hybrids, but that's what it boils down to). The target percentage increases each year. For last year it was about 7%. If an automaker fails to meet the required percentage, it must buy enough credits from an automaker which exceeded theirs. Failure to do so results in fines, and eventually being banned from selling vehicles in California. About a dozen states automatically adopt California's auto regulations (looks like it's down to 10 now), so this effectively means an automaker could be banned from selling to about a third of the U.S. by population. So they all go along with it. That's what's been driving EV sales - the annual percentage increase in the ZEV mandate. Not necessarily increased consumer demand. If the automakers aren't selling enough ZEVs to meet the percentage, they drop the price and run incentives and sales on their EVs, even if it means selling them below cost.
Since Tesla always exceeds the required percentage, their credits become a revenue source. In fact I suspect this is what gave Musk the confidence to start Tesla in the first place - he realized that even if he lost money on each car sold, he could make up the difference by selling credits and remain solvent. But the net result of all this is that EV sales are subsidized by ICE vehicle sales. And the answer to "Would Tesla be profitable if all government subsidizes were eliminated?" is no.
I've posted this about a dozen times, and it's amusing. If the Tesla fans get to it first, they mod it down into oblivion, even though everything I've written is factually correct and can be confirmed by reading CARB's website [ca.gov]. You can even look at the ZEV credit balances [ca.gov] (although the data seems to take about a year to come out). I'm not saying the ZEV program is wrong (in fact I think it's a good idea though I may not agree with the exact required percentages). I'm just pointing out that it exists, and is currently necessary to keep Tesla afloat.
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The ZEV credits are around 7% of their revenue. If they suddenly lost the credits, they'd take a loss that was around 5% of revenue, which isn't very big. They could likely make up the shortfall by cutting expenditure and their continuing increase in revenue.
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Postponing any one of that could land them back to profit column. Taking ZEV and subtracting it from profit is naive. We can subtract it from CapEx and see simply slowing down the growth will give them the profitability.
They have several billion dollars in full self driving sales which i
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There is associated cost - making and selling zero emissions vehicles that people actually want to buy in large numbers.
If there was no associated cost, then every automaker would just have the credits they need to offset their non-zero emissions vehicle sales. But as it turns out, creating a zero-emissions vehicle that people actually want to buy and drive is kind of hard, and Tesla is the only company that has managed to do it with mass market appeal.
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That's what's been driving EV sales - the annual percentage increase in the ZEV mandate. Not necessarily increased consumer demand.
Consumer demand can be thought of backwards in a curve of supply and price. Don't confuse "there's no demand", with "consumers would like EVs, but are unwilling to pay for it".
There's very clear evidence of the latter both in subsidies bringing the cost to the consumer down, and newer cheaper electric cars massively outselling older expensive ones.
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Yeah, no they did not lose money. Technically you are either a fool or a paid shill.
Our society has decided that putting poison into the air, water and ground is a bad idea. There are 3 ways to deal with that issue, in order from best/most logical to worst/what we do:
1) Make it illegal to do this. The polluters dislike this idea as it literally puts them out of business and require people to use the more expensive non-polluting cars.
2) Tax the crap out of anyone that pollutes. Again, they dislike this
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If you're going to dig into the financials then it's important to dig in all the way. Yes, they got a pile of money from carbon credits. They spent every dime of that and another hundred million on top of it on capex building gigafactories in Berlin and Shanghai.
Reasonable future growth projections do not in any way support their existing P/E, but it looks like they are actually making money. If it's funny money I don't see it.
The biggest risk to the company I see is litigation risk over autopilot. That
Lights out factories (Score:2)
Working in a factory doing repetitive BS is a waste of human soul. We need lights out factories. When are they gonna design a car that can be 100% made by robots? Why not design for robotic manufacture?
Who am I kidding, they can't even make a phone without humans to assemble it.
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It's not that simple.
Local government wants employment and taxes on people's salaries.
There are thousands of factories around the world that literally hire people to do the last stage of something (i.e. clip things together) purely so they can employ enough people to get government subsidies and approval of their commercial use of the property and things like that.
Those people aren't "necessary"... a robot can do their job. But they provide employment in the local area, which is often a condition of being
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Why can't the company pay the government a tax in lieu if hiring and let the government hire people to do other work (build infrastructure/housing stuff). End result being the same number of people are employed but factory productivity is increased and the town gets improvements.
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Because the tax would get abused and they know it. The choice is pay a tax equivalent (or more) to hiring people (and all the sub-costs of that) anyway, that can change at any time in future years, or just hire a handful of workers to do a worthless job and "keep in" with the local community who approve their expansion plans, etc.
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When are they gonna design a car that can be 100% made by robots?
They tried. You have an over inflated view of the capabilities of robots. Telsa has literally hundreds of patents on car designs that are unique in that they are robot friendly to assemble. Much of it didn't materialise as it became evident that robots weren't up to the task yet, that humans were still essential to keep robots running, and that for every robot screwup the assembly line was down for far longer than the value the robot was providing over a human worker.
Who am I kidding, they can't even make a phone without humans to assemble it.
You're conflating two issues. If Trump g
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There are already factories where the vast majority of the work is done by Robots
They don't do some jobs as it it still cheaper to employ a human
As you say most people in the factory supervise and service and repair the robots
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They tried to do that with the Model 3, and discovered that there are still many tasks that humans are far better at than robots. So they decided that they could fiddle with robots trying to tweak them for weeks and god knows how much money in cost in order to maybe get it to where it could do what a human can do, or just put a guy there for $25 an hour and produce parts right now.
It's a lesson that the big boys learned quite a while ago, and Tesla learned the hard way with "production hell".
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There it is! (Score:2)
If that's not proof that their next products are going to be electric hiking shoes and electric bicycles, I don't know what is.
2000 acres 15 minutes from downtown? (Score:2)
How did he find 2000 acres within 15 minutes of downtown on the river that's not all condos and townhouses?
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In the case of the first one, it was meant to reflect the sheer scale of the thing, since it was going to be one of the largest buildings in the world when completed, and produce more lithium-ion batteries than the rest of the world combined at the start of construction. Then they started building other, seemingly less impressive factories, and kept using the "gigafactory" name, which kind of diluted the meaning a bit, I think. This new Texas factory is to be Gigafactory 5. The second was in New York, the t
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Isn't "gigafactory" just a marketing word for an actual thing that exists called a factory?
Why yes, yes it is.
It's almost as if you think people aren't allowed to make up names for things they made.
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