They could just bring an example test drive car to the home of any potential customers for an hour or so for them to try. If the customer likes it they can then just order a new car via either the person whom is with the test drive car, or through the Tesla web site.
With everything now moving towards being brought to us at home/work, it kind of makes sense to do the same with something like a car. It sounded odd when I first heard about it, but the more that I think about it, the more that I think that this could work for them.
I found the news on hitting the 35k price point interesting and important - thatās where they could really hit the mainstream car market which is far larger than their current market.
Suspect they have cut jobs and sales channels to hit that price point before the other car makers can compete. A bold bet.
Tesla depreciation performance is not too bad, especially considering the EV average so far.
Youāre right though it makes far more sense to either lease or purchase 12-36 month old used.
I think the <$200 targets are just a littleā¦questionable (I am physically restraining myself typing that). Have to say that Tesla has pretty much a make or break year ahead of it, weāre seeing a mountain piling on right now with China, stores and the Crawley fire, SEC and profitability. If the Model Y reveal is even remotely close to āmehā I think I might be start getting uglyā¦
Model Y is cheaper than I thought it would be, it also looks good, specs are nice as well.
They mention 15 minutes charge gets you 168 miles, this will be the next major competing point, especially since the Porsche Taycan can provide a 62 mile range in 4 minutes. Feels like Tesla might be headed in the wrong direction on pay per use for the chargers, when again Porsche will provide free charging points for 3 years.
Iāve had some time (and sleep!) to digest Q1 Earnings, which you can access here, initially fearing for the worst I think there are silver linings in the shareholder letter.
The loss of $522m is not great, but isnāt wildly out of control, given the bond payment and the mysterious $188m of non-recurring costs that Tesla mentioned. The cash balance of $2.2bn is also not too worrying for the reasons below, but its now realistically dipping below $2bn for the first time since 2015 thanks to VAT payments and other immediate costs. Even Elon has hinted at the possibility of a capital raise.
Capex & Capacity: Capex is being used on the Semi Truck, scaling Solar, Model Y and Service+Charging network. Shanghai Gigafactory is being financed using Chinese debt, if youāll remember, but unclear when it should be online, especially if China enters a slowdown or Trade wars intensify. Energy revenues were also severely limited by battery capacity which was routed to M3 production. Some are estimating solid growth (c. $2bn) once more in this segment for the year. Automotive production is also modestly improving (Musk on the call scoffed that 5000 cars a week is no longer a problem).
There are plenty of positives: Model Y and Shanghai-built Model 3 margins are likely going to be very juicy (See Relative capex per unit of capacity graph on p. 2) and should help reverse the gross margin trend. Autopilot/Robotaxi is a long-term revenue stream that could start being realised within two years, and the progress confirmed for the Solar Roof this year should also help with the eviscerated Energy margins too. Tesla detailed how inventory issues are not quite as bad as many thought, although itās hard to see how they can stop inventory buildup worsening with European expansion looming. Musk also confirmed on the call that stores will not be axed, simply trimmed where necessary (this is objectively a positive given the lease costs involved with closure). In line with all this, Tesla guides positive operating cash flow and profitability from Q3, which actually seems probable.
Demand: Tesla laid the blame almost entirely on seasonality and adjustments in lineups/production, but we simply donāt know how true this is yet. Non-US markets will obviously drive Model 3 demand for the rest of the year, but a ~50% reduction in S+X deliveries YoY is worrying, and market-beating range upgrades are not going to double sales on their own. Watch out for S/X deliveries in the Q2 letter, and if they slip further, alarm bells should start ringing in Palo Alto.
A minor clarification: Tesla has confirmed it will be using several battery suppliers for Shanghai. Together with the negative Panasonic news this could be the end of a decade-long friendship.
Iāve felt they have been overvalued and even with the 25% drop of share price of last year I still wonāt touch them. I just donāt know how they keep finding cash.
I listened to the earnings call last night. I was rather encouraged to be honest and over the next couple of years Iām hopeful they can start bringing in more of those additional revenue streams. At the moment there is definitely a blockage in battery production which is slowing down activity in the power wall sector whole they prioritise the use for cars but this year they suggested lore capacity would go to power wall and that things like the solar roof tiles will start earning next year in earnest.
If they can work with regulators over then next few years on the automatic taxis then that would be very exciting.
Tesla stated last night that all tesla currently being sold will be able to be turned in to auto taxis and earn their owners an additional revenue, not to mention for tesla I would have thought too.
My own opinion and do your own research. Obviously I choose to believe what they say, not everyone will.
Yes I think Musk is a huge liability to Tesla, but also a huge asset. He clearly sees where the industry is going and will sacrifice anything but himself to get there, but his timelines are far too optimistic (a deliberate tactic I suspect to drive employee sacrifice) and he canāt resist taunting competitors. I too am optimistic in the long term for Tesla, esp. if he finds some capable operations people as at spacex. The software talent he has there is impressive IMO.
Iāve now invested in Tesla and will be interested to see what happens but it is my riskiest investment outside crowdfunding.
