Electric cars

Martyn1981

zeupater wrote: »

Hi

So it looks like consensus is that Tesla made a loss in Q1&Q2(/H1) whilst M3 production was ramping up from pretty negligible levels towards planned production volumes and the current situation is that at current production volumes each individual vehicle made may currently being sold at a price which not only covers prime costs, but also more than the appropriate fixed costs /overhead apportionment and could therefore be truly profitable!

Whether this reflects in the overall corporate profitability really depends on the company's next planning stage ... if they've already started to invest in development of future product lines (such as the Model-Y, /Truck & Pick-up) & associated plant & equipment requirements then whatever the quarterly results update looks like won't reflect a stable condition, which has been the case in each phase of the planned growth so far so why expect any different? ... as Model-3 moves into profit, focus redirects to newer programs.

The issue here is that prior to the M3 each model has seen an incremental development in Tesla's ability to expand as a niche market operator, however, in putting the M3 into production the company made a step-change timed to coincide with the anticipated global growth of the EV sector ... having taken the step from the niche sector into mainstream volume production future expansion will return to being more incremental, but on a completely different scale and with less effect on overall profitability given the available cash-flow from existing product sales.

HTH
Z

What you say is fair, reasonable and rational, however the problem is .........

as and when that expansion investment takes place for the MY and semi, they will most likely go back into 'loss'. This will be perfectly correct and reasonable, but many sites will jump to FUD, and I think it's fair to say that Ade (and if anyone criticises him, Car 54) will start Tesla knocking again.

Also, we can bet that Elon will probably set tough production targets that will not (on occasions) be met, which will again result in FUD and lengthy attacks from Ade, who seems to consider production numbers for the TM3 poor, despite them being higher than any other BEV. In fact, one site pointed to the TM3 accounting for about 2/3 of US sales, and Tesla nearly 90% (sorry for the mix of fractions and %'s), which to my rather naive eye looks quite impressive.

I just hope that the other companies stop trying to find fault with Tesla, and instead try to compete with them, as Tesla can't fix this mess on their own (the transportation side of AGW emissions). The market is ready for EV's, I just wish the old boys would start producing them in big numbers, ideally big enough numbers to reach profitability.

AdrianC

Martyn1981 wrote: »

Ade, who seems to consider production numbers for the TM3 poor

Well, the last fortnight has seen production estimates down to around 3-3,500 again, after a brief month when they hit 5,000, with one week nudging up to 6,000... So we're currently sat at the production levels originally forecast for September last year, and way behind even this July's estimates, which reckoned on a sustainable weekly 6,500 or so by now.

https://www.bloomberg.com/graphics/2018-tesla-tracker/


Perhaps their methodology is flawed - it seems to have fit right up to the end-of-Q2 reported production levels, so we'll see in a couple of weeks whether it fits the end-of-Q3 reports.



I'm making no value judgements here, simply reporting facts.

zeupater

AdrianC wrote: »

Well, the last fortnight has seen production estimates down to around 3-3,500 again, after a brief month when they hit 5,000, with one week nudging up to 6,000... So we're currently sat at the production levels originally forecast for September last year, and way behind even this July's estimates, which reckoned on a sustainable weekly 6,500 or so by now.

https://www.bloomberg.com/graphics/2018-tesla-tracker/

Perhaps their methodology is flawed - it seems to have fit right up to the end-of-Q2 reported production levels, so we'll see in a couple of weeks whether it fits the end-of-Q3 reports.

I'm making no value judgements here, simply reporting facts.

Hi

Perhaps there's a more fundamental explanation ... but then again I believe that you sussed the 'facts' on that one out a while back ...

AdrianC wrote: »

... So 6k/wk now - which means they're still well within capacity, since production has dropped from a one-week peak of just over 6k cars and five consecutive weeks over 5k, back to <4k, probably as they try to reintroduce some of the automation they swapped out to release the bottleneck ...

Can we stop this puerile constant Tesla bashing until there's something relevant to actually moan about ... if you don't like the company, management or products then that's your own opinion and you're entitled to have it, however others may hold different views to which they're equally entitled!

If the endeavour fails then it follows plenty of others and will be superseded by another equally innovative organisation, however if it doesn't then don't worry as there's going to be plenty of humble pie to go around ...

HTH
Z

Movie_Star

Forgive me as I don't own an electric. It seems to me that any fuel and running cost savings are offset against the cost of battery replacement when that becomes due. Leaf battery cost £5k and €9.9k for Zoe 40kw. I don't know the price of the cheaper battery for the Zoe. The Zoe (Renault) of course tried to "reduce" the cost by offering a lease on the battery.

Another interesting observation is the reduction of the number of older Leafs on our roads. I cannot be sure, but the figures in the "how many left" website seems to suggest that a lot of vehicles have been exported after initial 3 year PCPs came up for renewal. I constantly hear how many new electric vehicles are being sold, but how many are more then a few years old?

Interesting observation. I could of course be wrong...

AdrianC

zeupater wrote: »

Can we stop this puerile constant Tesla bashing until there's something relevant to actually moan about ...

<shrug> Merely answering the point that Martyn made.

zeupater

AdrianC wrote: »

<shrug> Merely answering the point that Martyn made.

Hi

Possibly, but previous form suggests probably not considering that the recent statement ... "Perhaps their methodology is flawed" ... doesn't reconcile to the previous one ... "probably as they try to reintroduce some of the automation they swapped out to release the bottleneck" ... therefore the post looks to have been made for no reason other than to 'bash' either Tesla or Martyn as opposed to 'answering' a point with an argument that had effectively already been conceded on production optimisation grounds, ie - knowing that new & more efficient machinery is being installed in order to reduce costs & improve margins.

Interestingly, the report you previously introduced into the discussion ...

AdrianC wrote: »

http://ir.tesla.com/static-files/7235e525-db16-470c-8dce-9ecac0ad7712

... highlighted the approach that the company was taking ...

We believe that increasing capacity by improving utilization of our existing lines and making selective improvements to address bottlenecks rather than creating ...

... effectively taking a continuous improvement approach to streamline & increase production on current assembly lines as opposed to capital investment in replicating existing processes.

The productivity (/speed) of automotive production lines is limited by the slowest operation station (ie the bottleneck) ... addressing issues at these bottlenecks normally allows the TACT to be improved to the point where it becomes apparent that other stations form new bottlenecks .. fix these, rinse & repeat, that's what improves efficiency ... Continuous Improvement, Lean Manufacturing & Six Sigma are effectively incremental efficiency & quality based philosophies, not just terms - if Tesla have taken this onboard at this early stage in their existence then they've probably done far better than most in the sector!

HTH
Z

Martyn1981

AdrianC wrote: »

Well, the last fortnight has seen production estimates down to around 3-3,500 again, after a brief month when they hit 5,000, with one week nudging up to 6,000... So we're currently sat at the production levels originally forecast for September last year, and way behind even this July's estimates, which reckoned on a sustainable weekly 6,500 or so by now.

https://www.bloomberg.com/graphics/2018-tesla-tracker/


Perhaps their methodology is flawed - it seems to have fit right up to the end-of-Q2 reported production levels, so we'll see in a couple of weeks whether it fits the end-of-Q3 reports.



I'm making no value judgements here, simply reporting facts.

Anyone else doing better?

Martyn1981

AdrianC wrote: »

I'm making no value judgements here, simply reporting facts.

Well that's a good one, let's look at a recent claim from you about Tesla:

AdrianC wrote: »

Perhaps, when I said "They have shown no sign of being able to make a profit so far.", I should actually have said "They have shown no sign of being able to report any quarterly non-trivial profit so far."

That looks like a very negative judgement!

Yet here you are praising the profits of Amazon:

AdrianC wrote: »

That's a May 2017 article. Even then, it's still not quite putting the full picture forward by saying "just a handful of profitable quarters", is it?




from

https://www.recode.net/2018/2/1/16961598/amazon-jeff-bezos-record-profit-11-quarter-q4-2017-earnings
(Feb 2018, so there have been two more quarters of profit since)

However, I guess you missed this line in your Forbes article - "Tesla makes very cool electric cars. It also makes lots of big losses."

Now, if we take market cap into account, with Tesla 2013 Q1 of about $5bn, or Tesla 2016 Q3 of about $30bn, and scale up to Amazon's approx $500bn, those Tesla profits would equate to about $0.5bn-$1bn. That's very similar to the Amazon profits, that you are so impressed with.

Strange how you can take two comparative figures, and praise one whilst calling the other trivial?

But as you say, no bias ...... of course.

And we've already seen you falsely trivialise TM3 production by a factor of 11 (22 v's 2). But as you say, no bias.

And we've had you falsely declare 4m PEV's as being mostly non-PHEV's. But as you say, no bias.

AdrianC

Yes, you have a point there. Let's run some numbers.

In terms of profit/loss to market cap, then -$717m for a $51bn company (-1.4%) isn't a million miles from +$1.9bn for a $940bn one (2.0%), apart from the direction, of course.

Tesla's $11m profit quarter was at a time of $10.2bn cap, so about 0.1%, while the $22m profit quarter was when the market cap was about $30bn, so around 0.7%.

Perhaps a fairer test is to scale to turnover, since it ignores any stock bubbliness. -$717m on $4bn quarterly turnover versus +$1.9bn on $60bn quarterly turnover - I make that about an 18% loss versus a 3.2% profit. Tesla's profitable quarters were $11bn on $560m (1.9%) and $22m on $2.3bn (just under 1%).

Martyn1981

Doesn't look like it matters whether Ade is biased against EV's, we are going to have them anyway, and sooner than we thought if we're to have any chance of staying within the global carbon budget.

EU must end new petrol and diesel car sales by 2030 to meet climate targets – report

New petrol and diesel car sales in Europe must be phased out before 2030 if the auto sector is to play its part in holding global warming to the Paris agreement’s 1.5C goal, a new analysis has found.

Forecourt plug-in hybrids will also have to disappear by 2035 at the latest, according to analysis by the German Aerospace Centre (DLR).

Under this scenario, the last vehicle with an internal combustion engine would be sold in 2028 and diesel and petrol powered-cars would be banished from the roads by the mid-2040s.