China Market situation and outlook

[chickensevil]

I think demand for China is still going to be there they are just being held back by production and the service center presence.

Oh and it was 40% to Asia, not China specifically. That number could have gone down to 30% because of a number of reasons. Keeping mind mind Perce tages can only go to 100 if NA is growing that fast for them then it takes up a larger percentage. This doesn't mean that the demand has gone anywhere at all in China (or Asia) just that the US is so strong at this point that it is dominating their sales.

Remember he said on the call he felt they could float 50k Model S without even touching China. That is saying a LOT about the NA (and possibly a bit on the EU) front as far as demand. A car of that class really should be peaking out in NA without them expanding into all of the US properly... But it seems like they are just not even coming close to that. I say it that way because there are still probably about 25 or so states in the US that don't have a Tesla presence (service center)

 

[Zzzz...]

Remember he said on the call he felt they could float 50k Model S without even touching China. That is saying a LOT about the NA (and possibly a bit on the EU) front as far as demand.

One could check service center/galleries/supercharger maps in China and Europe and clearly see that Europe is much bigger market for Tesla atm.

Moreover, QUOTE Elon Musk: "over half of those are North America and Europe and Asia are the remaining half" <-- notice that Europe mentioned before Asia.

 

[maoing]

QUOTE Elon Musk: "over half of those are North America and Europe and Asia are the remaining half" <-- notice that Europe mentioned before Asia.

Elon's words changing from quarter to quarter.
Q1: US/EU/China will be 1/3 for each
Q2: US 40%, China 40% and EU 20%
Q3: US 50%, Asia/EU 50%
Q4: ???

- - - Updated - - -

TM China posted on Weibo today that 18 inventory model S on T-mall has been sold out. http://www.weibo.com/teslaofficial
Not sure if it's really sold out or banned by Elon.

Regarding the T-mall thing... this apparently wasn't sanctioned by Tesla... at all.

 

[Ingenieur]

It is acutally funny to say T-Mall sale wasnt Tesla when it is advertised on official Weibo Channel, what going on with China guys? Developing life of their own?

 

[schonelucht]

TM China posted on Weibo today that 18 inventory model S on T-mall has been sold out. http://www.weibo.com/teslaofficial
Not sure if it's really sold out or banned by Elon.

Wow. This implies it was a Tesla China effort after all, but that Elon didn't know about it? Otherwise it makes no sense to report it as 'sold-out'.

 

[uselesslogin]

Note Tesla stopped reporting revenues split up by region this report, most likely to avoid any speculations

Well, they did but they left us numbers that do tell us the revenue from China for Q3:

"During the nine months ended September 30, 2014, we recognized revenues of $984.0 million in the United States, $371.7 million in Norway and $342.8 million in China."

The last 10Q had revenues from Asia of $141.5 million for the 6 months ending June 30th. So we know that revenue from China in Q3 is at least $201.3 million.

 

[hobbes]

Elon's words changing from quarter to quarter.
Q1: US/EU/China will be 1/3 for each
Q2: US 40%, China 40% and EU 20%
Q3: US 50%, Asia/EU 50%
Q4: ???

I think that this just shows again it is not about demand (which would not change that much from quarter to quarter), but just how they distribute the cars. Q3 with the downtime they had to hurry delivering cars, so 10% went to the US instead of China.

 

[Jack6591]

I felt like Elon went to great lengths to emphasize that demand was not an issue. Seems to me we're burning a lot calories to find something that is not there. Signal to noise ratio???

 

[chickensevil]

Elon's words changing from quarter to quarter.
Q1: US/EU/China will be 1/3 for each
Q2: US 40%, China 40% and EU 20%
Q3: US 50%, Asia/EU 50%
Q4: ???

- - - Updated - - -

TM China posted on Weibo today that 18 inventory model S on T-mall has been sold out. http://www.weibo.com/teslaofficial
Not sure if it's really sold out or banned by Elon.

Percentages don't tell the whole story. If current levels were say 20k NA, 20k Asia, and 10kEU... And then the NA shot up to 30k unexpectedly. Asia and EU demand would still be about where they projected it and now the NA demand has gone up higher than before. These are hypothetical numbers that fit within the percentages recently given. So it very likely has nothing to do with less demand overseas and more to do with higher demand (than previously expected) here in NA.

I don't see that post on weibo so I will have to take your word for it... To get there I would have to sign up for an account it seems... But from the other posts I see it does look like a valid account. *shrugs* maybe elon didn't understand the question or just doesn't know the specifics of how that is happening? I don't know.

 

[Ingenieur]

I know i risk being burnt at the stake, but maybe Elon knew about it after all but avoided to explain that the Tesla China is out of control and seem to have developed life of their own, i have said in another thread but was accused of spreading rumors i cant prove, i have a friend at VAG China, so he told me back in spring that Tesla China was actively advising bulk resell buyers as to how to circumvent their own max 10 cars policy, this offer is just another brick in the wall. The fact that one guy has 100 Model S on its lot tells it couldnt have happened without Tesla china turning a bilind eye at least.

I also think that the shift in sales expectations is not due to higher demand in US but lower elsewhere, its just my opinion based on observations, not some insider knowledge to make it clear. Remember when Elon said they will sell 1000 cars a month in germany or that UK will be biggest market in Europe (bigger then Norway)

 

[TSLAopt]

I know i risk being burnt at the stake, but maybe Elon knew about it after all but avoided to explain that the Tesla China is out of control and seem to have developed life of their own, i have said in another thread but was accused of spreading rumors i cant prove, i have a friend at VAG China, so he told me back in spring that Tesla China was actively advising bulk resell buyers as to how to circumvent their own max 10 cars policy, this offer is just another brick in the wall. The fact that one guy has 100 Model S on its lot tells it couldnt have happened without Tesla china turning a bilind eye at least.

I also think that the shift in sales expectations is not due to higher demand in US but lower elsewhere, its just my opinion based on observations, not some insider knowledge to make it clear. Remember when Elon said they will sell 1000 cars a month in germany or that UK will be biggest market in Europe (bigger then Norway)

In Elon we Trust...

he he is a straight shooter, I don't think he would be deceiving us

 

[SebastianR]

No worries, I won't burn you at the stake - so was gehoert sich ja nicht ;-)

I also think that the shift in sales expectations is not due to higher demand in US but lower elsewhere, its just my opinion based on observations, not some insider knowledge to make it clear.

I believe the shift in sales was due to the production issues: we saw a clear miss of targets production wise and still a delivery numbers being ok. I guess it was simply a way to rescue Q3 at least a little: selling the cars in the US saves the transport time = more cars delivered.

Remember when Elon said they will sell 1000 cars a month in germany or that UK will be biggest market in Europe (bigger then Norway)

Yep, remember that really well. I think he was not prepared for the patriotic petrol heads of Germany where (allegedly) every 7th job is depending on the car industry and he just simply looked into the number of Audi, BMW, Mercedes luxury sedans in the same price category and extrapolated from there.

Doesn't matter that much to me - and he is not alone in being wrong about cars: the boss of VW/Audi/Porsche Winterkorn said a only few months ago it is technically impossible to build an electric car with a range of more than 150km. To me that sounds like a much bigger blunder... (I still hate Audi for axing the eTron)

 

[Chickenlittle]

In Elon we Trust...

he is a straight shooter, I don't think he would be deceiving us

We need to be careful. You cannot trust anyone blindly. Yes I believe in the tesla model and find musk to be a genius but there is not anyone that doesn't lie on occasion. Don't compare anyone to God.

 

[RobStark]

We need to be careful. You cannot trust anyone blindly. Yes I believe in the tesla model and find musk to be a genius but there is not anyone that doesn't lie on occasion. Don't compare anyone to God.

There is lying and then there is material misrepresentation by a CEO of a public company. That invites lawsuits. Only really desperate CEO do that.

 

[Hkpkfan]

Tmall is supposed to be strict about it's suppliers who sell on their website. Ideally it's supposed to be the brands selling their own product, or companies with papework to prove they are authorized to sell those brands on Tmall. They try really hard to make sure all sellers are authentic so no fake goods enter the website. Chinese customers are willing to pay a somewhat higher price then some of the other auction sites out there, because Tmall requires some certifications.

As you can imagine, China has the worst problem in general with fake products floating all over the market. It's one of the worst problems in the country. Everyone is always worried what they buy might be fake. So Tmall has developed it's reputation for giving Chinese customers confidence in being able to buy authentic products with no worries it's fake or bad or anything like that.

I've heard there are ways around the certifications so that a 3rd party can still sell a product on Tmall and not necessarily represent the brand, but of course still being the authentic product.


So it's possible China Tesla jumped on Tmall without Permission from HQ and now got in trouble, and it's also possible a 3rd party got the right paperwork together or the right connections and found a way to get Tesla cars on Tmall.

It's hard to know the real story.

 

[RobStark]

Remember when Elon said they will sell 1000 cars a month in germany or that UK will be biggest market in Europe (bigger then Norway)

I remember when Elon Musk delivered the first Model S in Germany and said he expected sales of 300-400 units per month. I don't recall him ever saying Tesla will sell 1000 units per month in Germany. CEO's of US public companies don't make future projections like that. He based 300-400 unit projection on the fact that Germany was the biggest foreign market for the Tesla Roadster, Germany's love of solar power and desire to reduce its carbon foot print.

And when he presented the first Model S in the UK he said he expects that eventually the UK will be the biggest market for Tesla in Europe. Tesla is at the beginning stage of opening stores,service centers, and the Supercharger network in the UK. It is no where as far along as in Norway or even Germany.

And remember in June 2012 when Elon said he expected global demand for Model S to plateau at 20k units per year?

And remember when he said he expected an indifferent to mildly hostile reception in China?

 

[Ingenieur]

Here you go regarding 1000 cars a month, he actually said 300-400 a week, so even more. He also said not reaching it would be a bad sign.
Use google translate

Tesla-Chef Elon Musk greift BMW, Daimler und Audi in Deutschland an - manager magazin

 

[Electroman]

On the same vein we need to also be circumspect of Elon's claim of reducing battery costs by 30% or more when Gen 3 hits the market, and keeping Gen 3 under $35K

Let us not confuse between his genuine desire, intention, hope and what his crystal ball says, and what might actually happen. There may be other forces - engineering, technological or marketing - that he may have simply overlooked at this time. Only time will tell.

 

[Ingenieur]

More on China Stock Cars, orphaned vehicles?
Also more indication its official Tesla sale on T mall

http://www.d1ev.com/35491.html

 

[Chickenlittle]

There is lying and then there is material misrepresentation by a CEO of a public company. That invites lawsuits. Only really desperate CEO do that.

Yes I agree and do not believe he would do that