ZEV credits

[Chickenlittle]

Disclosure: I am not a Model S owner. In fact, I don't own a car yet (college). Still, it is my understanding that the forums can be used for discussion by non-owners.

In my just-created blog I've made what I believe is the most thorough analysis of ZEV credits yet. Okay, okay, there are more thorough things out there - but I've been unable to find them in web.

I know it sounds like the most spammish thing to do, linking to your own blog in the first post you make. Still, the point of this thread was to understand ZEV credits, so I think you'll see value in my article.

http://doubtingisthinking.blogspot.com.es/2013/10/tesla-carbon-credits-ongoing-scandal.html

Summary:
-Four months after the event, there are no swap stations and no estimate on when the first one could be built, if at all.
-The production car cannot do what is shown in the video.
-Starting in 2018, ZEV credits will be awarded on range alone, so the loophole will be closed. This means 20% of the "loophole period" (2013-2017) for Tesla has already elapsed.
-CARB is aware of this and has extended the loophole for another year.

In the link you will find some other gems. For example, they did not actually use the fastest gas station in LA.

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[uselesslogin]

So lets just calculate this out now.

650 adjusted credits divided by fleet average NMOG of .035 form table at bottom of page.

650/.035 = 18,571 credits. (probably representing 5,000 cars or so)

I think the penalty for non-compliance is $5,000/credit. So, Tesla would sell at a discount to this so I will assume $2500.

18,571 * $2500 = $46 million.

We know $10 million was recognized as revenue last quarter, so that means we should get at least $35 million this quarter with an absolute upper limit of $75 million or so.

It means Tesla has a chance of achieving GAAP profitability this quarter but only through ZEV credits so not the victory I'm looking for but if it helps push the stock price up I'm not complaining.

Let me know if I made some errors here.

 

[ItsNotAboutTheMoney]

So lets just calculate this out now.

650 adjusted credits divided by fleet average NMOG of .035 form table at bottom of page.

650/.035 = 18,571 credits. (probably representing 5,000 cars or so)

I think the penalty for non-compliance is $5,000/credit. So, Tesla would sell at a discount to this so I will assume $2500.

18,571 * $2500 = $46 million.

We know $10 million was recognized as revenue last quarter, so that means we should get at least $35 million this quarter with an absolute upper limit of $75 million or so.

It means Tesla has a chance of achieving GAAP profitability this quarter but only through ZEV credits so not the victory I'm looking for but if it helps push the stock price up I'm not complaining.

Let me know if I made some errors here.

Tesla will not achieve GAAP profitability before the Gigafactory and Model 3 are pumping out their products at good efficiency and rate. Paper profits are bad for business.

 

[mostapasta]

@uselesslogin last year Tesla received $3,464/ZEV Credit or $98,696/ZEV g/mi NMOG Credit so the upside for Q3 would be below that, which generates an absolute upper limit at ~$64 million for this year (Q4 '13 through Q3 '14). I'd guess they will show something between $40-50 million this quarter.

 

[uselesslogin]

c

@uselesslogin last year Tesla received $3,464/ZEV Credit or $98,696/ZEV g/mi NMOG Credit so the upside for Q3 would be below that, which generates an absolute upper limit at ~$54 million for this year (Q4 '13 through Q3 '14). I'd guess they will show something between $30-40 million this quarter.

I tried it several times in my calculator

650*$98696 = $64 million and I checked that several times. So the highest likely revenue for Q3 is $54 million. That being said by absolute upper limit I was talking about an unrealistic situation where they sell them for close to the cost of non-compliance, not a likely outcome. I would see $50 million this quarter as an outside possibility but would expect $30-40 million as well.

 

[Bgarret]

A slightly different way to look at it:

2012 ZEV transferred - 1311
2013 ZEV transferred - 650 (or about 1/2)

(reminder - ZEV runs September - September)

2012 Revenue from ZEV -

Q4 2012 - (estimated) $21 million
Q1 2013 - $68 million
Q2 2013 - $51 million
Q3 2013 - $10 million (all from shareholder letters)

2012/3 Revenue from ZEV $150 million +/- $10 million for Q4 2012 numbers.

2013/4 Revenue realized so far from ZEV - $10 million in Q2.

My guesstimate on projected revenue from ZEV in Q3: between $60-70 million or between $.42-.50/share. Based on Q2, that would have been very close to GAAP profitable, but it is also likely costs were significant in Q3 due to plant retooling.

$60-70 million of free $ is going to be good news regardless, especially if TESLA can re-qualify for higher credits based on operable battery swapping and generate more credits with the "D" And the "X".

 

[Chickenlittle]

A slightly different way to look at it:

2012 ZEV transferred - 1311
2013 ZEV transferred - 650 (or about 1/2)

(reminder - ZEV runs September - September)

2012 Revenue from ZEV -

Q4 2012 - (estimated) $21 million
Q1 2013 - $68 million
Q2 2013 - $51 million
Q3 2013 - $10 million (all from shareholder letters)

2012/3 Revenue from ZEV $150 million +/- $10 million for Q4 2012 numbers.

2013/4 Revenue realized so far from ZEV - $10 million in Q2.

My guesstimate on projected revenue from ZEV in Q3: between $60-70 million or between $.42-.50/share. Based on Q2, that would have been very close to GAAP profitable, but it is also likely costs were significant in Q3 due to plant retooling.

$60-70 million of free $ is going to be good news regardless, especially if TESLA can re-qualify for higher credits based on operable battery swapping and generate more credits with the "D" And the "X".

equipment was previously bought in previous qtr, the upgrade started two weeks into the qtr

 

[Mitthrawnuruodo]

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If he/she is lucky, they might be able to get the same analyst position John Petersen currently holds.....