Ask The Audience: What Did Elon Mean? - 2nd Edition

[ValueAnalyst]

Calling The Power of The Crowd.

What did Elon mean with the following comment?

"Yes. I currently think that we should build to 500,000 vehicles next year and 1 million vehicles by 2020. That's 500,000 vehicles in total, Model S, Model 3, and Model X combined next year should – as far as the information I have at my disposal right now, I believe that is the most likely outcome. And then, with a couple more years, getting to 1 million units. That seems also the most likely outcome. Yes."

Tesla (TSLA) Q4 2016 Results - Earnings Call Transcript | Seeking Alpha

 

[SBenson]

It is quite an old CC.

There is more updated info in later CCs right?

 

[ValueAnalyst]

It is quite an old CC.

There is more updated info in later CCs right?

The later ones have 5,000/week by end-17, 10,000/week sometime in 2018, but if you find any other, please post.

 

[Johann Koeber]

Just so I get this right:

500,000 in total for 2018 means:

S+X about 120,000, leaving about 380,000 for M3.

MY will not be out yet, neither the truck.

If 10,000 per week run rate is achieved by July 1: thas would be 24 weeks (usually about 1 week of no production per quarter) gives us 240,000 M3

Counting backwards we would need 140,000 M3 in the first 24 production weeks, averaging 5,834 per week - this seems possible when ramping from 5,000 to 10,000 in this time.

So, this is my interpretation of what he meant.

 

[ValueAnalyst]

Just so I get this right:

500,000 in total for 2018 means:

S+X about 120,000, leaving about 380,000 for M3.

MY will not be out yet, neither the truck.

If 10,000 per week run rate is achieved by July 1: thas would be 24 weeks (usually about 1 week of no production per quarter) gives us 240,000 M3

Counting backwards we would need 140,000 M3 in the first 24 production weeks, averaging 5,834 per week - this seems possible when ramping from 5,000 to 10,000 in this time.

So, this is my interpretation of what he meant.

Some members have interpreted the guidance as 5,000/week avg for most of 2018, and only ramping to 10,000/week towards the end in 4Q17 with possible delay, so a total of ~250k Model 3 deliveries in 2018, and S/3/X combined deliveries of 350k.

OR is the guidance 500,000 cars delivered in 2018?

I agree that Model Y or Semi/pickup will not be out until end-19 at the earliest.

 

[EinSV]

I don't think there is any doubt at all that the target has been 500,000 total vehicles produced in 2018.

I thought Elon was clear on the call you cite as well as other places but Tesla also put it in writing, for example, in the Q3 2016 earnings letter:

Capital expenditures remain on plan to help us reach our goal of producing 500,000 vehicles in 2018. Tesla - Current Report​

 

[ValueAnalyst]

I don't think there is any doubt at all that the target has been 500,000 total vehicles produced in 2018.

I thought Elon was clear on the call you cite as well as other places but Tesla also put it in writing, for example, in the Q3 2016 earnings letter:

Capital expenditures remain on plan to help us reach our goal of producing 500,000 vehicles in 2018. Tesla - Current Report​

I think that is a very good data point, so thank you for sharing that.

What I thought was necessary to illustrate is that, despite either side of the two polls I created being so certain of their own understanding to the point that both sides use phrases such as "no doubt," "obviously," "only dumbs would think otherwise," "you must be naive" and so on, the poll results clearly show dead-even, neck-and-neck ambiguity among even the TMC members who are more experienced with Tesla's communication style than an average retail investor.

Recognizing this is a prerequisite to improving communication. As someone who was born and raised in another country, and having learned a number of languages, I understand all too well how complicated communication can be, not only because of the underappreciated complexities of language, but more importantly, because of human tendencies and biases. Tesla has not yet recognized this fundamental truth.