Electric cars

Martyn1981

AdrianC wrote: »

Yes, I do.


Q1 $709m loss

Q2 $718m loss
Q3 $311m profit


$709m + $718m = $1,427m loss for H1.
$1,427m - $311m = $1,116m loss over Q1-3.


Now, are we happy with that?

So a 'cumulative loss' over the time period then, as I said.

If you are now therefore retracting your lie:

AdrianC wrote: »

your attempt to deny FYTD18 being down $1b, remember?

then I'm happy with that.

[Note - I was wondering what tactic you would use to distract from Tesla going profitable, and it seems to be, to just post lies and spin, hmm.]

AdrianC wrote: »

<yawn> Just because you're STILL incapable of reading the post in question, in which all the figures and sources were given, and the maths was explained... Go on, go back and have another look, as I've suggested you do several times...

So go ahead and give the figures and sources again supporting your claim that US F-150 sales are 22x greater than TM3 production ...... go on, or admit it's a lie?

AdrianC

Hold on a minute... You agree that Q1-3 cumulative loss is $1,116m - but you think "FYTD18 being $1b down" is a "lie"?


You do know they're the exact same thing, right?


Numbers really aren't your forte, are they?

Martyn1981

AdrianC wrote: »

Hold on a minute... You agree that Q1-3 cumulative loss is $1,116m - but you think "FYTD18 being $1b down" is a "lie"?


You do know they're the exact same thing, right?


Numbers really aren't your forte, are they?

Nope they are not the same thing, but nice try at spinning the lie.

I agree that Q1-3 cumulative loss is ~$1.116bn.

I disagree with your lie stating:

AdrianC wrote: »

your attempt to deny FYTD18 being down $1b, remember?

Interesting to see that you are now doubling down on the lie, by quoting only part of it and saying I disagree with the amount, rather than the fact that I disagree with ever disagreeing with it ... IYSWIM.

Please stop this silliness now, but please do provide evidence supporting your continued 22x claim, please.

Martyn1981

AdrianC wrote: »

Numbers really aren't your forte, are they?

I know the difference between 2 and 22, so I'm at least one page of the 'maths for dummies' book ahead of you.

zeupater

AdrianC wrote: »

...
Q1 $709m loss

Q2 $718m loss
Q3 $311m profit


$709m + $718m = $1,427m loss for H1.
$1,427m - $311m = $1,116m loss over Q1-3.


Now, are we happy with that? ...

Hi

I really think that there's a continuing total misunderstanding of business issues & both financial & management accounting practices in play here ....

In both Q1 & Q2 Tesla's M3 production was low, therefore although each unit built & sold covered the material & variable costs incurred and contributed towards the business's fixed cost element, volume throughput dictated that the total contribution didn't cover all of the business's fixed costs, therefore a loss was accrued over the periods.

In Q3, production volumes were high enough to more than recover all of the fixed costs, therefore a profit was accrued over that period.

Now, what does that likely mean for the current quarter? ... well, if TM3 build/sales volumes for Q4 remain similar to Q3 (~53k) then there's no reason to not expect similar levels of profit to be reported ..... however, this is where fixed costs and what they really mean on volume related grounds need to be considered.

Once build volume at a particular selling price reaches the point where all of the fixed operating costs have been recovered, additional incremental sales beyond this threshold don't provide profit on a simple pro rata basis, they become hugely profitable and there's plenty of detailed analysis by automotive specialists that suggest the unit margin is above 30% at planned production volumes, so if fixed costs, development, financing & administration account for a typical ~1/3 of total overall costs, we're potentially looking at a realistic profit of around 50% after the fixed cost threshold has been passed ...

Now, in terms of TM3 weekly build, Q3's 53k equates to ~4100/week, each adding ~$50k of revenue, so a 10% increase on volume to ~4500/week could add around 40% ($130million) to group profit, whereas meeting the planned volume of 5k/week (22%) could result in an almost doubling of total group profitability in Q4 to around $600million ... it's also relevant to note that a contributing factor in TM3 production not meeting predictions in Q3 was the installation & commissioning of more efficient automated processes towards the latter part of the period ...

Okay, we've got a handle on a reasonable total FY18 profit band ... -$800million (1116-311) to -$500million (1116-600) .... of course, if they build more or seriously address outgoings there'd be a substantial positive effect on this ... for example, building an average of ~6k TM3s/week and experiencing increases in other model sales similar to those seen in Q4 last year would be very interesting! .... whilst at the other end of the scale, tariffs imposed on imports/exports and their combined effect on competitiveness will have a temporary negative impact on group profitability ...

However, what is clear from the Q3 results is that Tesla, having been profitable in Q3, are likely to also be profitable in Q4 and therefore are confirmed to be both capable of operating as a profitable business and currently profitable, whereas historically (ie Q1&Q2) investment in business expansion & a related low revenue stream whilst ramping-up production deemed a loss ...

Anyway, just trying to bring a little reality into the ongoing pantomime ... 'Oh Yes it is!' ...

HTH
Z

AdrianC

Martyn1981 wrote: »

Nope they are not the same thing, but nice try at spinning the lie.


I agree that Q1-3 cumulative loss is ~$1.116bn.

OK, great.
But I'm intrigued as to how that's different to FYTD18 being $1b down.
(FYTD18 is Financial Year 2018 To Date, btw - so the same thing as Q1-3 of FY18)

I disagree with your lie stating:

Oh, sorry. I thought I'd reminded you of your statements stating it was "FUD" and "denial", back at the start of the last page.
Here y'go:

https://forums.moneysavingexpert.com/discussion/5591486/electric-cars&page=129#2576

You think that's agreement? OK... I'll go with that. So we're all on the same page... Group hug.

AdrianC

zeupater wrote: »

Now, in terms of TM3 weekly build, Q3's 53k equates to ~4100/week, each adding ~$50k of revenue

Yep.

so a 10% increase on volume to ~4500/week could add around 40% ($130million) to group profit

Hmm. Not entirely convinced by that - those figures would see $25,000 of profit in each of those 5,200 extra cars in the quarter...

it's also relevant to note that a contributing factor in TM3 production not meeting predictions in Q3 was the installation & commissioning of more efficient automated processes towards the latter part of the period ...

Are they in place yet? Because if not, then there's going to be yet more investment. Unless they've just shelved all that and are happy sitting at the current (manual?) 4-5k/wk. Most recent week, by Bloomberg, is 4,423,and appears stable there.

Okay, we've got a handle on a reasonable total FY18 profit band ... -$800million (1116-311) to -$500million (1116-600) ....

Yep, seems reasonable. Like I said - two profitable quarters cancelling out one of the loss-making ones.

However, what is clear from the Q3 results is that Tesla, having been profitable in Q3, are likely to also be profitable in Q4

You'd like to hope so, unless there's been some behind-the-scenes accounting shenanigans to get a good news story out there. We shall wait and see.

From the Q3 update letter...

Tesla wrote:

Of the 455,000 net reservations that we reported in August 2017, less than 20% have cancelled. We are expecting most of the remaining reservations to gradually convert to orders

So ~370k reservations. 110k built to date. ~260k still in the queue. So the queue is still about 60 weeks, at current production rates. That's without any word on the number of post-summer "direct orders". So place your Model 3 order today, delivery's currently likely to be in early 2020.



Oh, and the v9 autopilot software includes the ability to play computer games when the car's parked. Priorities, eh?

zeupater

AdrianC wrote: »

OK, great.
But I'm intrigued as to how that's different to FYTD18 being $1b down.
(FYTD18 is Financial Year 2018 To Date, btw - so the same thing as Q1-3 of FY18)


Oh, sorry. I thought I'd reminded you of your statements stating it was "FUD" and "denial", back at the start of the last page.
Here y'go:

https://forums.moneysavingexpert.com/discussion/5591486/electric-cars&page=129#2576

You think that's agreement? OK... I'll go with that. So we're all on the same page... Group hug.

Hi

Actually, what looks to have happened in this latest spat seems to revolve around this post ...

Martyn1981 wrote: »

AdrianC wrote: »

... 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.

... so your argument simply looks to have moved from Q3 to YTD to cling on to the self satisfaction gained from claiming a 'win' on Tesla being a loss making entity, whilst it's clear to the majority that they're currently profitable (as in now, today, this week, last week, this month, last month, this quarter(to date), last quarter ... :wall:) because production volumes of the TM3 have passed the threshold where the fixed costs have been recovered ....

:think: .... This is getting to be a little like the dead parrot sketch and you're simply playing the shopkeeper's part ... although the parrot could have been alive in both Q1 & Q2, the act of nailing it to the perch at the beginning of Q4 and claiming that as an average over the year so far it's been alive doesn't really change the fact ... in terms of what's being discussed it's almost exactly the same storyline - in 1969 the parrot was demonstrably dead & in Q3 Tesla were demonstrably profitable and most likely continue to be ...

HTH
Z

zeupater

AdrianC wrote: »

Hmm. Not entirely convinced by that - those figures would see $25,000 of profit in each of those 5,200 extra cars in the quarter...

Are they in place yet? Because if not, then there's going to be yet more investment. Unless they've just shelved all that and are happy sitting at the current (manual?) 4-5k/wk. Most recent week, by Bloomberg, is 4,423,and appears stable there.

Hi

'Hmm ...' ... Read the rest of the post and try to understand what happens to the proportion of the selling price that would pay the fixed overheads when all of the fixed overheads have already been paid ... does it get forgotten by everyone, or possibly become pure profit? ...

'Are they in place yet? ...' ... as you are aware, Tesla operate a continuous improvement policy and are currently increasing cell efficiency & capacity with automated equipment - this was discussed a while back when the running/rolling change first started ... in terms of investment, the capital equipment cost will transfer directly to the asset register and not be depreciated in the current year - the negative impact on the financials being driven by lost opportunity whilst the changeover continues, after that the efficiency improvement should relieve a production bottleneck and show as an increase in both production & productivity ... that's why they're doing it! ...

HTH
Z

AdrianC

zeupater wrote: »

... so your argument simply looks to have moved from Q3 to YTD

Ah... I see.

Yes, "cumulative... for the year" did mean I was referring to the entire FY. What I didn't clarify, of course, that it's only so far this year. Sorry, I assumed it would have been obvious I was talking about YTD, rather than full FY, since obviously we don't have Q4 18 figures yet. My apologies for the confusion.

(I s'pose I could have been talking about the last four quarters for a rolling year... But if you then add the $675m lost in Q4 17...)

zeupater wrote: »

'Hmm ...' ... Read the rest of the post and try to understand what happens to the proportion of the selling price that would pay the fixed overheads when all of the fixed overheads have already been paid ... does it get forgotten by everyone, or possibly become pure profit? ...

I think you might be forgetting that increasing production will incur substantial additional variable costs - the need to buy parts and raw materials for those extra cars...