Clearly our spreadsheets contain very different assumptions. Even in a scenario where S/X production is back at 25k/quarter in Q2 22 the additional revenues generated are smaller than those that will come from Y production at Berlin and Austin if they follow a similar ramp to Shanghai.
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Near-future quarterly financial projections
- Thread starter luvb2b
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- elon is an ass
Revenue doesn't equal profits though. Margin is what is important and S/X at a fully run rate will have margins that dwarf the 3/Y.
S/X's margins and profits at 25k a quarter run rate will have an outsized impact on earnings. Berlin/Austin will be a slight drag on profits for Q1-Q2 and will then start helping margins/profits rather than hurting them in Q3/Q4 and then will have a much larger impact in 2023. Hence why I said S/X will have an outsized impact on earnings for the next 4-6 quarters.
Note that I'm not saying S/X ramped are needed for further margin expansion. Just that they will add a substantial layer of icing on top of the cake for 2022
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So are you expecting S/X margins to be significantly higher than the 30% that was achieved across S3XY in Q3 21? What is your estimate?
Yes, in the range of 40% gross margins ( maybe 45%) on the S/X when the line is running at full production. The base price of the LR and especially the price of the Plaid is significantly above the price levels of the old S/X LR and Perf versions. I also make expectations that consumers in the market for S/X are more likely to buy FSD which further increases margins.
Well the new S&X were supposed to be cheaper to build than the old... I don't have a specific reference but people keep saying Elon said that. The old S sold for $69,420 and the new S is presently $95K or $130K... but the builder defaults to the +$4500 wheels and you need some kind of upgrade like that to avoid an 11-month wait (18 months for the X!). Once both models are up and running and the early orders with lower prices cleared out... is 50% margin too high?
Yes that too, Elon on Q4 2020 earnings call said that the new S/X were cheaper to build. Forgot to mention that as well. So yes I could see 50% margin, especially on the Plaid trims.
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In the current macro climate where car prices are elevated and where S/X are still trying to deliver the initial order backlog 50% might be possible. However I would not expect this to continue longer term. For the same reasons it seems likely that 3/Y margins will rise above 30% in the near term but may reduce back to 25-30% in the longer term.
Returning to the point @StarFoxisDown! raised, even at 50% margin for S/X and 30% for 3/Y, the additional profit from S/X is not significant over the next 4-6 quarters.
jeewee3000
Active Member
Not as long as demand greatly outstrips supply, which - in the case of S/X - will be for many years to come.
Tesla keeps gaining more customers/stakeholders due to the immense popularity of the 3 and Y. Therefore, the market for S and X also keeps growing. However, the production of S and X is fixed at a minimal rate of 100k/year.
So demand keeps growing, and supply remains the same. -> prices (and margins) can rise, to keep the backlog in check. And for example Mercedes is barely making $$ on the EQC / EQS equivalent vehicles! Go Tesla!
Insane delivery numbers for Q4!
The only question for Q4 profits is margins. I think the biggest difference Q3 vs Q4 is that Shanghai made cars were sold mostly in China, while Q3 there was a lot of exports to Europe. This was because of China tax credits were fading out at the end of 2021 so there was a huge local delivery push for Chinese customers.
Tesla prices are quite a lot higher in Europe than China, and European exports are more often long ranges and performances than locally sold models. However, with exports, there is bigger shipping fees plus import tax (at least Fremont to EU was 11% import tax, I assume the same applies to Shanghai to EU).
Overall I'm super excited for Q4 results. Would love to hear opinions from TMC pro's how you see margins in Q4.
The only question for Q4 profits is margins. I think the biggest difference Q3 vs Q4 is that Shanghai made cars were sold mostly in China, while Q3 there was a lot of exports to Europe. This was because of China tax credits were fading out at the end of 2021 so there was a huge local delivery push for Chinese customers.
Tesla prices are quite a lot higher in Europe than China, and European exports are more often long ranges and performances than locally sold models. However, with exports, there is bigger shipping fees plus import tax (at least Fremont to EU was 11% import tax, I assume the same applies to Shanghai to EU).
Overall I'm super excited for Q4 results. Would love to hear opinions from TMC pro's how you see margins in Q4.
The Accountant
Active Member
Agree - Lot's of moving pieces to accurately forecast margins.Insane delivery numbers for Q4!
The only question for Q4 profits is margins. I think the biggest difference Q3 vs Q4 is that Shanghai made cars were sold mostly in China, while Q3 there was a lot of exports to Europe. This was because of China tax credits were fading out at the end of 2021 so there was a huge local delivery push for Chinese customers.
Tesla prices are quite a lot higher in Europe than China, and European exports are more often long ranges and performances than locally sold models. However, with exports, there is bigger shipping fees plus import tax (at least Fremont to EU was 11% import tax, I assume the same applies to Shanghai to EU).
Overall I'm super excited for Q4 results. Would love to hear opinions from TMC pro's how you see margins in Q4.
One upside to keep in mind:
Shanghai production Q3: 129k
Shanghai production Q4: 178k (est)
That's 49k more vehicles produced in Q4 than Q3 and likely with the same fixed cost base.
This could equate to a drop in fixed costs per car of over $1,000.
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Could one also view it as 49k vehicles with $0 fixed cost?
The Accountant
Active Member
Revenues of $17.3B
Non-GAAP Income of $3B
This non-GAAP income of $3B would more than triple the number from last year of $0.9B
Here is my Q4 estimate as compared to Q4 2020.
Non-GAAP Income of $3B
This non-GAAP income of $3B would more than triple the number from last year of $0.9B
Here is my Q4 estimate as compared to Q4 2020.
The Accountant
Active Member
Here is my Q4 estimate as compared to Q3 2021.
In a mere 3 months, from Q3 to Q4, Tesla increases Non-GAAP profit by almost $1B (from $2B in Q3 to $3B in Q4)
In a mere 3 months, from Q3 to Q4, Tesla increases Non-GAAP profit by almost $1B (from $2B in Q3 to $3B in Q4)
the most anticipated posts since the P&D report. Thank you!
The Accountant
Active Member
The Accountant
Active Member
I believe my estimates may be lower than the Tesla bulls on Twitter and YouTube as I took a conservative approach to margins.
Margins are still impressive:
Margins are still impressive:
The Accountant
Active Member
My CEO Award and Stock Based Compensation Estimate:
The Accountant
Active Member
Yes - that's a good way to look at it too !!
So only a 0.7% bump in GM (2.4% change)? Seems like removal of radar, phase in of price increases, reduction in EoQ expedite fees, and increased units across existing plants (including 2.5k more S/X deliveries compared to Q3) should all boost the numbers, though I don't know by how much.
Is the drop in credits % due to dilution of amount across higher revenue? With the issues other OEMs are having, seems like they may be in high demand.
Thanks !
