Near-future quarterly financial projections

[Yuha]

I saw a post about salaries in Giga Berlin. Those salaries seemed extremely high for manufacturing jobs, and they didn't even include stock based compensation. I assume the situation is similar in Fremont. We don't know exactly which factory and region is making profits but I started to think that does all/majority of Tesla's profits come from MIC cars - especially MIC exports? Profitability skyrocketed at the same time as Giga Shanghai ramped + it would make sense logically. Right now they are exporting those cheaply made Shanghai cars to Europe and selling them at the same price as Fremont cars.

Risk: what happens when Berlin starts to ramp up and Shanghai exports starts to decrease? Are we going to see crash in profit margins or does shipping costs + import tax make up the difference in employee salaries?

My quick estimate is that the higher salaries might increase total costs by about 2% (when fully ramped up). Compare that to 10% import tariff and probably roughly 3% of shipping costs.

A bigger issue might be parts and materials. China is an excellent place to be in terms of supply chain. According to Tesla's recent impact report Shanghai is now 90% localized while Fremont is about 75% localized. How well can Tesla localize their supply chain in Europe and at what cost? But then again most parts and materials are cheaper to ship and have lower tariffs than full cars.

Then there are capital costs, specifically depreciation costs might be higher in Berlin, but that has probably less than 1% effect on the total cost.

So my guess is that Tesla should be able to achieve lower total costs once Berlin ramps up fully. And that does not yet take into account of the newer technology in Berlin.

 

[j6Lpi429@3j]

Surely Germany is a great place for supply chain localisation? Enough German auto companies have been there long enough that such things are already in place.

 

[The Accountant]

My Q3 2021 P&D Estimates

I had originally started with a 220k delivery estimate for Q3 but increased Fremont Model S and China Model Y production has my latest forecast at 240k deliveries. My estimates are not demand based; instead, I forecast what production will be for the quarter and then estimate whether Tesla can deliver the cars on time before quarter end. In this quarter, I estimate that Tesla will deliver more cars than they produced in the quarter as they work down some inventory in China.

My numbers may change as I review the China production number for August which will come out around the 22nd I believe.
Fremont still remains a wildcard regarding Models 3&Y as we see no interim data for Fremont as we do for China.

 

[The Accountant]

This is my expectation for Shanghai:

 

[The Accountant]

Q3 2021 Financial Forecast . . . $2.01 EPS vs Wall Street $1.45

All line items are at record levels . . . .Revenues, Gross Profit, Operating Profit, Etc., Etc.

Here is my forecast vs Q3 2020

 

[The Accountant]

Here is my forecast vs Q2 2021

 

[The Accountant]

If Deliveries come in a bit lower, financials are still going to be strong. Here are some scenarios:

Each 1,000 vehicle variance is about $0.01 per share. If you change the forecast from 240k to 230k, only reduced EPS by $0.10 to $1.91 (still well above Wall Street estimate of $1.45)

 

[The Accountant]

Tesla delivered $1.45 EPS in Q2; getting to $2.01 in Q3 is pretty straight forward:

The extra vehicles delivered gets you an additional $0.39 EPS for Q3.
Product mix provides another $0.16 to EPS as Models S & Y make up a larger % of total sales and these vehicles have better margins than the Model 3.

 

[The Accountant]

Some important notes to my financial projections:

- I assume no bitcoin impairment or gain (a charge should not have a material impact to the Qtr)
- I assume no FSD deferred revenue recognition in Q3
- I assume no recognition of the Def Tax Valuation Allowance in Q3

 

[st_lopes]

@The Accountant my only thought is that all incremental units will be unusually high margin (S out of Fremont, Y out of Shanghai). If these units truly are as high margin as some predict, your gross margin estimates may be significantly understated. Bullish AF.

 

[Chunky Jr.]

Tesla delivered $1.45 EPS in Q2; getting to $2.01 in Q3 is pretty straight forward:

the various price increases should help a lot too. I assume you have that in your model.

 

[Artful Dodger]

Here is my forecast vs Q2 2021

View attachment 708805

Nice. Operational leverage is ~3x

(+56% GAAP EPS per +19% ↑Deliveries)

 

[The Accountant]

@The Accountant my only thought is that all incremental units will be unusually high margin (S out of Fremont, Y out of Shanghai). If these units truly are as high margin as some predict, your gross margin estimates may be significantly understated. Bullish AF.

That's true, I may be conservative with my margins especially with the Model Y.

 

[The Accountant]

the various price increases should help a lot too. I assume you have that in your model.

My Average Selling Price (ASP) for the Model Y stayed flat as my model shows the price increases in the US were offset by the lower priced Model Y SR roll out in China.
However, I have the Model 3 ASP in Q3 equal to Q2 and that is likely conservative as there were several price increases in the US this year that we should see taking full effect in Q3. So perhaps there is upside to my model there.

 

[hobbes]

Before it gets lost - this post might be interesting for calculations here, ASP calculation (just for WA state, but that quite detailed and maybe somewhat representative for other states?)

I made a script to pull sales data from WA state and calculate the ASP for each model by month.

Model S ASP for Q3 in Washington is $110,030.43

ASP	Model	Count	Month
54232.82​	Model Y	262​	Jan-21​
48319.76​	Model 3	42​	Jan-21​
87980​	Model X	2​	Jan-21​
53252.64​	Model Y	347​	Feb-21​
46220.24​	Model 3	41​	Feb-21​
55265.35​	Model Y	1003​	Mar-21​
47735.05​	Model 3	657​	Mar-21​
56786.59​	Model Y	261​	Apr-21​
47099.02​	Model 3	41​	Apr-21​
56344.03​	Model Y	124​	May-21​
46326.49​	Model 3	37​	May-21​
59548.35​	Model Y	1238​	Jun-21​
50130.08​	Model 3	845​	Jun-21​
118827.5​	Model S	72​	Jun-21​
55729.06​	Model Y	213​	Jul-21​
46700.14​	Model 3	148​	Jul-21​
104513.7​	Model S	38​	Jul-21​
56262.44​	Model Y	127​	Aug-21​
44672.34​	Model 3	64​	Aug-21​
133323.3​	Model S	9​	Aug-21​

Also maybe interesting for @Troy for Models share.

 

[Doggydogworld]

Before it gets lost - this post might be interesting for calculations here, ASP calculation (just for WA state, but that quite detailed and maybe somewhat representative for other states?)


Also maybe interesting for @Troy for Models share.

It'd be interesting to see comparisons to prior years. CA Model 3 registrations are down 40% in 1H21 vs 1H19 (19.75k vs. 33k), but of course Model Y more than compensates. Total 3+Y are up more than 40%, to 47k.

I don't like to extrapolate too much from a single state. Years ago you could assume Tesla's US sales were ~2x CA sales, but lately it's been more than 3x. Also, CA 3/Y mix is 42/58 while the WA data above shows roughly 33/67. Other differences can come into play, too. For example, the west coast has great Supercharger coverage which could lead to a higher percentage of SR+ vs. LR/P than other areas. Or maybe it works the opposite - i.e. people in other areas buy more SR+ and use their 'other car' for road trips.

 

[JusRelax]

My Q3 2021 P&D Estimates

I had originally started with a 220k delivery estimate for Q3 but increased Fremont Model S and China Model Y production has my latest forecast at 240k deliveries. My estimates are not demand based; instead, I forecast what production will be for the quarter and then estimate whether Tesla can deliver the cars on time before quarter end. In this quarter, I estimate that Tesla will deliver more cars than they produced in the quarter as they work down some inventory in China.

My numbers may change as I review the China production number for August which will come out around the 22nd I believe.
Fremont still remains a wildcard regarding Models 3&Y as we see no interim data for Fremont as we do for China.

View attachment 708374

Wow, @The Accountant , you really nailed it this time, withn +/- 2k for both deliveries and production!

 

[st_lopes]

All hail @The Accountant !!!

 

[30seconds]

So another round of upgraded FY2021 EPS coming? Last I checked Goldman was around $5/ share for the full year. Seems more likely to be close to $7.

the analyst community is really behind the curve of Tesla near term profitability. The impact of Tx and Germany by Q4 next year is going to be immense

 

[The Accountant]

Q3 2021 Earnings - My Final Estimate

Q3 2021 vs Q3 2020