OEM sales are to the dealers, not the final customers.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
MartinAustin
Active Member
That wording raised my eyebrow. I pulled a full Roger Moore on that one.
What the heck does he mean by "we believe" ? There's an awful lot of leeway there. Didn't sound very "dead certainty."
In my mind it is the opposite - if you don’t hedge you are leaving yourself open to changes in currency valuations (whereas with hedging you remove most of that variability, but it costs a little in hedging cost for that certainty).
Elon on 2023 car volume: shot at 2 million units as upside case, comfortable at 1.8m guide
Possible, but they'll get lobbied heavily. Legacy needs the consumer credits.
bkp_duke
Well-Known Member
Xepa777
Member
20% margin for energy business is bad. A gut punch. Unless that number encompasses a drastic pumping of mega pack factories (a very specific hopium interpretation to have), there’s a lot of bad in this call. Anytime Elon has to revert to talking about autonomy as the savior, that’s not good. It’s the same like he’s given every earnings call since like 2016. Throw in some dojo and Optimus projections and yah, it translates to “all your calls are dead for the next 2 years” lol.
And the way analysts keep drilling on pricing and the way the team keeps answering basically comes out to “yah today our production was much higher than sales, so uhhh make the least dumb decision and drop prices.” And they can only do that so much with their margins. It’s why Wall Street momentum really first started dying on the earnings call where Wloj said they weren’t actively working in the cheap car, because the whole “50% growth every year” narrative is dead. It’s actually dead. Until that model 2 comes out. And yah, it’s coming now, but until then we’re going to be in this painful valley which was entirely preventable had they kept to a projected model 2 release rather than putting all eggs on this robotaxi business.
Then again this could all be a clever cover for the fact that the 4680 is wildly delayed, like 3 year ramp delay. Which is actually what I believed happened, and all this “we’re not working on model 2 cuz model 3/y sales are so dominant” talk was just a cover. That’s why Berlin was hinted to start with 4680 yet to this day doesn’t have it, why semi is delayed, why cybertruck is delayed, etc.
And the way analysts keep drilling on pricing and the way the team keeps answering basically comes out to “yah today our production was much higher than sales, so uhhh make the least dumb decision and drop prices.” And they can only do that so much with their margins. It’s why Wall Street momentum really first started dying on the earnings call where Wloj said they weren’t actively working in the cheap car, because the whole “50% growth every year” narrative is dead. It’s actually dead. Until that model 2 comes out. And yah, it’s coming now, but until then we’re going to be in this painful valley which was entirely preventable had they kept to a projected model 2 release rather than putting all eggs on this robotaxi business.
Then again this could all be a clever cover for the fact that the 4680 is wildly delayed, like 3 year ramp delay. Which is actually what I believed happened, and all this “we’re not working on model 2 cuz model 3/y sales are so dominant” talk was just a cover. That’s why Berlin was hinted to start with 4680 yet to this day doesn’t have it, why semi is delayed, why cybertruck is delayed, etc.
EVNow
Well-Known Member
That was not the point … Elon was saying it takes a long time for OEMs to figure out what the sales were. When we get the transcripts we can see the exact language… I think Elon is talking about how dealers operated may be 20 years back.
Gigapress
Trying to be less wrong
If I remember correctly that 50%+ estimate from ZeroSumGame was solely for Megapack, whereas Zach was referring to Megapack and Powerwall combined, and Powerwall has worse margins.But Less than Zero promised 80% margins… 100% margins…
It's also ambiguous whether Zach and Elon were including IRA tax incentives, installation, or long-term services revenue in the mid-20% estimate. Both of these constitute a substantial portion of ZSG's margin estimate.
Megapacks still are priced at over $400/kWh. With $45/kWh for free from the US gov't, that's like for $450-500/kWh of revenue for the hardware. 25% gross margin would imply cost of ~$350/kWh.
But the LFP cells should cost closer to $100/kWh, if not less. Is the rest of the cost structure really going to be $250/kWh? Another way to look at it: will the cells be merely 20-30% of the overall cost structure? I doubt it, after the factory is at scale anyway.
If Megapack prices come down and the IRA credits aren't included, I could see 25% gross margin in the long run.
Depends who plays hardball - President & Senate need the GOP controlled house to pass debt ceiling increase, which comes increasingly more desperate as the debt limit is reached and the US faces defaulting on debt.
At this point which party is more likely to risk the US defaulting for the chance of political wins? I think that is fairly obvious.
Always fun tuning into the call and hearing the team say everything I've been saying for the last three months lol (plus a lot of things I didn't say of course)
Oh god please no.
Elon just mentioned a hypothetical of selling cars for zero profit.
Elon just mentioned a hypothetical of selling cars for zero profit.
ADAM JONAS TIME BABY!
Edit: Yes he asked something dumb about X.com.
Edit: Yes he asked something dumb about X.com.
KBF
Model X owner (formerly Cdn Signature Model S)
The only benefit is that it would probably bankrupt all American OEM's and take over market share... But that's a terrible talking point for short term share price...
“We’re trying to help competitors really”
Peak badass-ness
Peak badass-ness
Dear Lord Elon's answers sometimes are frustrating to listen to.
Adam Jonas is literally giving Elon a easy freebie there with that question about Henry Ford and how Ford's ability to drop costs and realize efficiences forced many other auto makers to go out of business and if we're seeing a repeat of that.
All you had to say Elon to get some nice press was to say "While we're not intentionally trying to put other auto makers out of business, the DNA of Tesla is such that it's a natural byproduct. Tesla's efficiencies and constant reduction in COGS will lead to other auto manufacturers going out of business".
Adam Jonas is literally giving Elon a easy freebie there with that question about Henry Ford and how Ford's ability to drop costs and realize efficiences forced many other auto makers to go out of business and if we're seeing a repeat of that.
All you had to say Elon to get some nice press was to say "While we're not intentionally trying to put other auto makers out of business, the DNA of Tesla is such that it's a natural byproduct. Tesla's efficiencies and constant reduction in COGS will lead to other auto manufacturers going out of business".
Xepa777
Member
He said this on Twitter spaces in December. He’s saying stuff we already know, but just putting more attention to Wall Street with weight behind his words (given the price cuts since then).
And Tesla gives zero ****s about short term share price. They said about as much on the call.
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