Electric cars

Martyn1981

AdrianC wrote: »

Well, I'm very pleasantly surprised this morning.


https://www.bbc.co.uk/news/business-45971786
$311m profit.


Full Q3 earnings letter - http://ir.tesla.com/static-files/725970e6-eda5-47ab-96e1-422d4045f799


Let's hope this is sustainable. Still north of $1.1bn cumulative loss for the year, of course.

My two fivers will be winging their way today, Martyn, with pleasure.

I was miles out so have just sent £10 to the Alzheimers Society, however the confirmation e-mail doesn't have a reference number, but for 'proof' it came from Will Watt, Customer Care Manager, dated today, at 7.41am. My reference was 'Fighting the FUD'.

Martyn1981

AdrianC wrote: »

Let's hope this is sustainable. Still north of $1.1bn cumulative loss for the year, of course.

LOL, deny till you die! The cumulative loss is due to the investment expenditure that led to the profit, just saying.

BTW, whilst the profitability of the investment in the S and the X and now the 3 will be sustainable, proving for a third time their business model, Tesla as a whole will most likely slip back into the red during the expansion/investment for the MY and semi.

Elon has suggested that they will avoid investment expenditure for two quarters in order to display profitability, and to make it clear that the FUD'ers are simply trying to mislead folk.


For anyone interested, a good point was made yesterday (though I forget by whom, as I watching lots of Youtube postings on the issue). Basically, the production launch to profit window has been getting faster for Tesla, the S took about 4yrs, the X about 2.5yrs, and the 3 about 1.5yrs.

AdrianC

Martyn1981 wrote: »

LOL, deny till you die! The cumulative loss is due to the investment expenditure that led to the profit, just saying.

Simple addition of the three quarters, Martyn...


If you want to go behind the headline, then take it up with Reuters.
https://graphics.reuters.com/TESLA-PROFITABILITY/010080Y81S7/index.html

As for the donations - you have a PM asking for clarification of the Cardiff ARC details, and a link to the guide dog payment.

<edit> "Elon Musk" has made a bank transfer donation to the ARC.

Martyn1981

AdrianC wrote: »

Simple addition of the three quarters, Martyn...

Nope, sad attempt at FUD.

The past losses have been well explained on here already as investment for future profitability. Had production begun one quarter earlier or later then the 2018 figures would be different, but the principle (sneakily) being ignored would be the same.

AdrianC

Yes, if they'd made and sold more cars so far, they would have made more money. That's how it goes.

But you still appear to be in denial about how corporate financial reporting actually works.

zeupater

Martyn1981 wrote: »

LOL, deny till you die! The cumulative loss is due to the investment expenditure that led to the profit, just saying.

BTW, whilst the profitability of the investment in the S and the X and now the 3 will be sustainable, proving for a third time their business model, Tesla as a whole will most likely slip back into the red during the expansion/investment for the MY and semi.

Elon has suggested that they will avoid investment expenditure for two quarters in order to display profitability, and to make it clear that the FUD'ers are simply trying to mislead folk.


For anyone interested, a good point was made yesterday (though I forget by whom, as I watching lots of Youtube postings on the issue). Basically, the production launch to profit window has been getting faster for Tesla, the S took about 4yrs, the X about 2.5yrs, and the 3 about 1.5yrs.

Hi

So despite the negative spin by many, including the referenced Reuters analysis (Increased ACP is worthy of reporting? ... :rotfl:!), Tesla were more than covering their fixed costs over Q3 even though total production was affected by the introduction of efficiency based cost saving measures .... just think how much they could have made if they didn't operate a continuous improvement policy! ..

Anyway, they're in profit (who'd have thought? - :whistle:) and the short sellers are looking to change their positions for a while - so why? ... well, all you need to do is look at the trading position between China & the USA and the effect on import duties payable by Tesla ... standing at 25% for some time, China offered to decrease to 15% from 1st July onwards before announcing a change to 40% later that month .... what does this mean - Tesla will need to either accept being sidelined in a large EV market -or- accelerate their Chinese investment program, which they've already announced (a couple of months ago) ... 500K vehicles/year to be built in new facilities based Shanghai, utilising the local supply chain - of course, there's the hurdle of circumventing the pre-2022 joint-venture rules, but there are ways of using time-limited partnerships to help with this.

Fine, so Tesla are looking to compress their overseas expansion timescales, but this is relatively simple & relatively inexpensive as it's effectively a cut & paste exercise on existing models & known processes with a return which is both more immediate and higher than developing new models .... potentially doubling the manufacturing capacity for TM3s within a couple of years or so would certainly be an economy-of-scale game changer by heavily diluting R&D (fixed) costs ...

Taking this into account, I'm not too sure that the level of profitability would be maintained over the next two quarters & wouldn't be surprised if the company did actually slip back into the red, it mainly depends on how partnership agreements effect the financing model for new facilities .... :think: ... maybe the partner could build the facilities and finance the plant & equipment, with Tesla maintaining total control over form tooling & IPO with a clause to buy out the partner for an agreed sum after 2022 if necessary! ... whatever the case, for the moment the short-sellers seem to have heat-blisters on their fingers and have chosen to rethink the validity of Tesla's strategy.

HTH
Z

Martyn1981

AdrianC wrote: »

Yes, if they'd made and sold more cars so far, they would have made more money. That's how it goes.

But you still appear to be in denial about how corporate financial reporting actually works.

Am I? Then how come I won the bet?

At some point you will have to admit that EV's and Tesla are winning, and give up on your MSE FUD campaign.

Martyn1981

zeupater wrote: »

Hi

Taking this into account, I'm not too sure that the level of profitability would be maintained over the next two quarters & wouldn't be surprised if the company did actually slip back into the red, it mainly depends on how partnership agreements effect the financing model for new facilities .... :think: ... maybe the partner could build the facilities and finance the plant & equipment, with Tesla maintaining total control over form tooling & IPO with a clause to buy out the partner for an agreed sum after 2022 if necessary! ... whatever the case, for the moment the short-sellers seem to have heat-blisters on their fingers and have chosen to rethink the validity of Tesla's strategy.

HTH
Z

I won't pretend to understand this, but I'm sure you will, but Tesla have mentioned that the Chinese Gigafactory will be funded/financed locally, so that might not have an impact on their figures ....... I understand the principle, but not how they can avoid TSLA being affected, unless the Chinese plant will somehow be ring fenced?

Regarding the 'US company' (again, no idea if that needs clarification or not) it will be interesting to see if profits can meet investment expenditure. I'd have thought it might just be doable for one new venture, but with the MY and semi both to rollout in the same time period(ish), I'd expect more red ink, but hopefully the FUD'ers will think twice before trying to spin the same misleading arguments over profits (v's profitability.)


Edit - If you are interested in a simple breakdown of Tesla's Q3 results, I'd recommend Ben Sullins at Teslanomics. He's a data analyst and his posted article is much better than the others I've watched today.

Martyn1981

Here's a handy visualisation of their business model, and the impressive reduction in launch to profitability each time. Shame the green profit is understated.

zeupater

Martyn1981 wrote: »

I won't pretend to understand this, but I'm sure you will, but Tesla have mentioned that the Chinese Gigafactory will be funded/financed locally, so that might not have an impact on their figures ....... I understand the principle, but not how they can avoid TSLA being affected, unless the Chinese plant will somehow be ring fenced?.

Hi

The issue is that China operate a policy that overseas automotive manufacturers can't simply open a plant in the country without it being a joint-venture with a Chinese firm, this restriction is due to be removed in 2022, which Tesla were aiming to take advantage of in their expansion plan.

In order to maintain a presence in China between now & 2022, Tesla were likely looking to sell US built vehicles at a reduced margin to remain competitive with local production, however, along comes the import duty change to 40% and imported TM3s suddenly become hugely price-disadvantaged in a rapidly growing EV market ... possibly in the region of 60% (40%import + ~20%local economics) ... any partnership 'deal' that allows bridging the 2022 gap would be advantageous to Tesla & having Tesla build vehicles in China would be politically & financially advantageous to their government ... in /after 2022 the joint-venture could be subject to an agreed buy-out/take-over so leaving Tesla in exactly the same ownership position, but building cars earlier.

HTH
Z