Musk: Tesla vehicles are now ’appreciating assets’ due to self-driving

[electronblue]

The price increase on the SR Plus and hiding/eliminator the SR- isn't about demand, it's about margin.
Saying they'll increase FSD price is also effectively margin.

Agreed on SR vs SR+ being about margin. Clearly making SR profitably is an issue at this time. Margin does play a part in their constant product and pricing changes. That said I do think many if not most of their moves with these model changes are actually about driving demand too...

I do not argree FSD price increase is about margin though. If it was, why pre-announce it so far ahead? I feel they want to create a sense of urgency after the 22nd for people to buy FSD at the current price. So a cash raise.

 

[ItsNotAboutTheMoney]

3) Tesla’s continued pricing and other antics are clearly motivated by driving demand, so inherent demand does not seem to be there in the numbers they’d like. One way would be to re-adjust demand expectations to a more realistic level and re-align the company to those. The capital raise would help buy time for this and help with any possible cash crunch.

The latest changes are about margin, not demand.

AP and FSD are software options.

 

[ItsNotAboutTheMoney]

Agreed on SR vs SR+ being about margin. Clearly making SR profitably is an issue at this time. Margin does play a part in their constant product and pricing changes. That said I do think many if not most of their moves with these model changes are actually about driving demand too...

I do not argree FSD price increase is about margin though. If it was, why pre-announce it so far ahead? I feel they want to create a sense of urgency after the 22nd for people to buy FSD at the current price. So a cash raise.

FSD is margin. It's a software option. For new vehicles they'll all have the same hardware. Demand is whether people buy the car.

 

[electronblue]

FSD is margin. It's a software option. Demand is whether people buy the car.

If so, why not just raise the margin then? Why wait two weeks to May 1st? Also why the drop in FSD pricing earlier this year and then pre-announced price hike later?

My feel is this is to create urgency and thus a cash raise first and foremost.

 

[RDoc]

When you have a depreciating asset and it gains in value for other reasons, it does not mean that the overall value will go up. In other words, if the value of FSD is so high that used Tesla’s will basically not depreciate, this would be the same as an appreciating asset. Obviously Elon does not mean that used Teslas will be worth more than new Teslas. A used car that generates income and does not lose value it most definitely is an appreciating asset.

No, that's not what the word "appreciating" means.

If a company buys a machine to produce a product that is profitable, they still depreciate the machine's value because it's market value is going down. An appreciating asset is one whose market value is increasing whether it is earning money for the owner or not. A classic car might be an appreciating asset because its market value is going up.

 

[traxila]

No, that's not what the word "appreciating" means.

If a company buys a machine to produce a product that is profitable, they still depreciate the machine's value because it's market value is going down. An appreciating asset is one whose market value is increasing whether it is earning money for the owner or not. A classic car might be an appreciating asset because its market value is going up.

Obviously you are correct. I was simply trying to provide a possible explanation for Musk's statement.

Seems he has clarified as specifically applying to FSD. So the explanation there would be that as the car depreciated overall, the FSD appreciation would be enough to not only hold its value, but appreciate the car overall.

Yeah, I would put that in the show me category.

 

[boonedocks]

No, that's not what the word "appreciating" means.

If a company buys a machine to produce a product that is profitable, they still depreciate the machine's value because it's market value is going down. An appreciating asset is one whose market value is increasing whether it is earning money for the owner or not. A classic car might be an appreciating asset because its market value is going up.

I’ll be very happy when my 2017 S100D purchased at $122,000 will be an appreciating asset (according to Elon) since it’s current KBB value has it at barely $56,000. Lmao

 

[anthonyj]

I wish he would stop embarrassing himself and investors. Jesus Christ just shut up and make things happen

 

[Cheburashka]

My 2-yr old Model S with EAP: ~100K new, ~50K today.

That appreciation can start at any moment now...