Q4 2013 results - data points, projections and expectations

[sleepyhead]

Thanks

It's hard to keep super plugged in all the time. The company is doing very well, and not doing anything unexpected if anyone was following these forums in 2012 and 2013 (and presumably earlier).

So the marginal value of my contribution is quite low, and the marginal value of long delayed vacations to exotic locales is concurrently higher at this point.

Congrats!

 

[callmesam]

Also, Tesla will consistently downplay the possibility and effects of ZEV revenue. They've been trying to fake out the press into thinking ZEV goes away by focusing on how it goes away in Q4.

THIS! +100. By focusing on diminishing ZEV credits going into Q4 . Implying they're gone. Saying "we don't count on the revenue" etc, they are building a beat-down into Q1.

Classic.

 

[DaveT]

Dave, what caused the discrepancy in net income (gaap and non gaap) between yours and the actual result?

*Edit: NM. DaveT was actually pretty spot on.

Here’s the major differences between my estimate and actual (the shareholder letter had a few minor numbers that I couldn’t reconcile but generally it’s fine for illustration purposes).

Basically I underestimated ASP significantly and total revenue but that was balanced by Tesla having higher expenses that I anticipated, namely higher cost of development services, higher SGA, and higher stock compensation. This led to non-GAAP income to be similar to what I was forecasting ($0.32 vs $0.33) but GAAP income to be slightly different (-$0.05 vs -$0.13). I was correct that GAAP profitability would be difficult to achieve without significant ZEV income.

Overall, the results are better than I expected because revenue was super strong as well as ASP.

 

[austinEV]

It is hard to buy a Model S for 100k, strange as it is to say that. Once you have decided to go to 100k, the last 5-7k in options seem real minor and you sell yourself on the pano, or the fancy paint, or the leather, or the...

 

[Zythryn]

Here’s the major differences between my estimate and actual (the shareholder letter had a few minor numbers that I couldn’t reconcile but generally it’s fine for illustration purposes).

Basically I underestimated ASP significantly and total revenue but that was balanced by Tesla having higher expenses that I anticipated, namely higher cost of development services, higher SGA, and higher stock compensation. This led to non-GAAP income to be similar to what I was forecasting ($0.32 vs $0.33) but GAAP income to be slightly different (-$0.05 vs -$0.13). I was correct that GAAP profitability would be difficult to achieve without significant ZEV income.

Overall, the results are better than I expected because revenue was super strong as well as ASP.
View attachment 43708

Dave, I am curious, is that average sale price stated by Tesla, or calculated in some way?
That seems very high to me. I see more 60s in our state than P+s.

 

[FANGO]

Dave, I am curious, is that average sale price stated by Tesla, or calculated in some way?
That seems very high to me. I see more 60s in our state than P+s.

In Southern California I see nothing but p85s.

 

[DaveT]

Dave, I am curious, is that average sale price stated by Tesla, or calculated in some way?
That seems very high to me. I see more 60s in our state than P+s.

I calculated the average sale price by taking the vehicle sales number and dividing by number cars delivered. I probably should have added GHG/Cafe income to the vehicle sale number so the ASP should be higher (which is mind-boggling because it's already so high).

The shareholder letter had development services at 4.368m and mentioned 15m in regulatory credit income (not ZEV), zero ZEV, and mentioned they received 13m from Daimler and Toyota (which I added to power train sales, which do not go into ASP).

I'm kind of scratching my head on how ASP can be so high but it could be Europe shipped mostly loaded cars and P/P+ demand was really high as well in US and Europe. If anyone has any insight on this, please let us know.

 

[brianstorms]

I'm in SoCal and I have a standard 85. So there's at least one

 

[Cobos]

I calculated the average sale price by taking the vehicle sales number and dividing by number cars delivered. I probably should have added GHG/Cafe income to the vehicle sale number so the ASP should be higher (which is mind-boggling because it's already so high).

I'm kind of scratching my head on how ASP can be so high but it could be Europe shipped mostly loaded cars and P/P+ demand was really high as well in US and Europe. If anyone has any insight on this, please let us know.

I've got one of the few S60s in Norway. And I still haven't seen one other S60 so I'm guessing I could use my fingers to count S60 sales (at least if I'm allowed to use toes as well). Every car is at least a S85 with decent amount of equipment and I'd say about half are P85 and P85+, that's out of almost 1500 sales in Norway in Q4. That might be some of the reasons the ASP has been pulled up.

Cobos

 

[Discoducky]

And I think as this is I think the first time TSLA reports produced it's precisely to show incremental increase. And there are other nice nuggets hidden in the report like showing that the Beijing store is highest traffic store ever (likely translates to record reservations) and for example customer deposits went from $138.8M a year ago to $163.1M even though Tesla delivered 22.5k cars. That shows the amount of demand that is HUGE.

nice, missed that, no issues with demand!

 

[sleepyhead]

Even though customer deposits went up from $138.8m to $163.1m Yoy, that is only peanuts. I expect that number to be a lot bigger in the Q1 balance sheet. $20m is equivalent to 500 reservations in China. Since we know that demand started soaring there after the fair pricing announcement (which only happened in January 2014), it should show up in the Q1 balance sheet.

1000 Chinese reservations = $40m

 

[chickensevil]

I calculated the average sale price by taking the vehicle sales number and dividing by number cars delivered. I probably should have added GHG/Cafe income to the vehicle sale number so the ASP should be higher (which is mind-boggling because it's already so high).

The shareholder letter had development services at 4.368m and mentioned 15m in regulatory credit income (not ZEV), zero ZEV, and mentioned they received 13m from Daimler and Toyota (which I added to power train sales, which do not go into ASP).

I'm kind of scratching my head on how ASP can be so high but it could be Europe shipped mostly loaded cars and P/P+ demand was really high as well in US and Europe. If anyone has any insight on this, please let us know.

I mean, when I bought my car, I didn't want to really spend more than I had to... I am not "rich" or "loaded" by ANY stretch of the word, yet even I couldn't resist getting options to the point where I spent 96k... and I ONLY got a regular 85. I think JUST adding the performance package is another 13k, so if I had done that I would be hitting well over that ASP without even trying.

 

[VolkerP]

I have one of just 5 S-60 in Germany, total for 2013 was 191 vehicles. So most were 85kWh which started at 81.650€ including VAT and import duty.

I guess that initial pricing for oversea deliveries was calculated with a cautionary buffer for exchange rate changes, since prices were announced months before finalize & deliveries. Tesla seems to have erred on the safe side. Recently they reduced prices due to "exchange rates / weaker US dollar". Reservation holders report that prices of their cars (if reordered) would be like €5.500 less or even CHF 11.000 less.

So I think Tesla achieved excellent US$ revenue on all cars delivered to Europe in Q4.

 

[chickensevil]

I have one of just 5 S-60 in Germany, total for 2013 was 191 vehicles. So most were 85kWh which started at 81.650€ including VAT and import duty.

I guess that initial pricing for oversea deliveries was calculated with a cautionary buffer for exchange rate changes, since prices were announced months before finalize & deliveries. Tesla seems to have erred on the safe side. Recently they reduced prices due to "exchange rates / weaker US dollar". Reservation holders report that prices of their cars (if reordered) would be like €5.500 less or even CHF 11.000 less.

So I think Tesla achieved excellent US$ revenue on all cars delivered to Europe in Q4.

Which explains the comment about how they had favorable exchange rates that contributed to their profits. While I don't think they should price gouge foreign countries I don't take major issue with them placing a "safety" buffer there if the exchange rates go sour, and then updating the price every 6 months or so. Because otherwise it has the potential to eat into their actual profits on the car itself.

 

[AudubonB]

Even though customer deposits went up from $138.8m to $163.1m Yoy, that is only peanuts. I expect that number to be a lot bigger in the Q1 balance sheet. $20m is equivalent to 500 reservations in China. Since we know that demand started soaring there after the fair pricing announcement (which only happened in January 2014), it should show up in the Q1 balance sheet.

1000 Chinese reservations = $40m

I just went through TMInc's Order--->Reservation page, trying to corroborate your $40K reservation statement. The interesting thing is that you can get from its pop-down menu "Price based on delivery to..." effectively every country on earth...exceptfor China! As here: Buy or Reserve a Tesla | Tesla Motors And $5K is the downpayment everywhere. So why did they up the ante so much for China?

 

[772]

$40k is no longer necessary in China for Model S... only 15k CNY: MODEL S 设计室 | Tesla（特斯拉）Motors

And for Model X it's 30k CNY

 

[Benz]

There is something from the shareholder letter that I want to discuss here with you guys:

"For the year, Model S was the top selling vehicle in North America among comparably priced cars. Nonetheless,we believe there is room to improve in 2014 as we complete the Supercharger network and enable vehicle
service almost anywhere in North America. The potential in Europe and Asia is even more significant. Towards
the end of the year, we expect sales in those regions combined to be almost twice that of North America."

OK, let's break it down:

- "Model S was the top selling vehicle in North America"
- "we believe there is room to improve in 2014"

What does that mean?
I think that it means that they will sell more Model S vehicles in 2014 (at least about 20,000?) than that they did in 2013 (about 18,000?).

- "The potential in Europe and Asia is even more significant. Towards the end of the year, we expect sales in those regions combined to be almost twice that of North America."

I think that this says more about the situation in 2015. Europe and Asia combined will be almost twice that of North America. Suppose that North America is 25,000 in 2015, then Europe and Asia combined will be almost 50,000. Meaning that the total will be almost 75,000. Right?

 

[AlMc]

Benz, That is how read it.

 

[Benz]

"We expect to deliver over 35,000 Model S vehicles in 2014"


That will be purely because they expect not to be able to produce more, meaning that they will be production contstrained?
Because I think that the number of new reservations for the Tesla Model S in 2014 will be somewhere close to 50,000 (at least).
But they know that too, don't they?
This means that the waiting time for a Tesla Model S will rise significantly in 2015, right?

 

[Krugerrand]

This means that the waiting time for a Tesla Model S will rise significantly in 2015, right?

No, because by 2015 they'll have their factory upgrades online.