So my tesla order was affirmed today after the one week wait. When I got the email - there was an indication that delivery would be late march / early April. Not wanting to miss out on the supercharger provision (must order this year and receive delivery by 4/1) - I sent my tesla contact an email and he assured me all will be good. What was great about that was he sent me a note right away and on xmas. I really think tesla has a super strong group of human capital that is very passionate about what they do. Makes a big difference and makes me more confident of my investment in tesla. Cheers to the longs
-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
- Status
I actually have an HP-15C that I still use frequently. This is the best piece of hardware I 've ever bought. I hope in 10 years I can claim my Model S comes first.
I am still using HP 48 series calculator introduced in 1990 - albeit as an emulation on my iPhone. In fact, I was holding off from switching to a smart phone for much longer than I should've. The decision to finally switch was after I discovered that I can get HP 48 emulation app, for free to boot.
We take our HP calculators seriously...
erthquake
Active Member
The problem is that Tesla is having a harder time selling ZEV credits at decent prices, according to Musk.
erthquake
Active Member
I remember this feeling when buying my first computer back in 1995. If I just wait two more months I can get a Pentium 133 instead of a P120.
It is really amazing that we're now experiencing this with buying cars!
MitchJi
Trying to learn kindness, patience & forgiveness
I think that Elon said something to the effect that the charge would vary depending on the local cost of electricity?
MitchJi
Trying to learn kindness, patience & forgiveness
Tesla’s SolarCity sells $241 million equity in its solar portfolio
The critics of the Tesla-SolarCity merger were concerned of the solar company putting a strain on Tesla’s cash balance, but after the acquisition, CEO Elon Musk surprisingly said that he expects the company to contribute to its cash instead. Today, the company announced that it raised $241 million equity from its solar portfolio in a solar cash equity transaction with Sammons Renewable Energy (SRE).
That's more than TSLA received in Q3 from their zev credits! If SCTY is aside, from this income, even close to cash flow neutral this could make a big positive impact on the Q4 financial numbers. If so how much can they get that way? Enough with the MS-MX income plus TE income to fund the M3 ramp internally?
I think that would be great for our March calls!
The critics of the Tesla-SolarCity merger were concerned of the solar company putting a strain on Tesla’s cash balance, but after the acquisition, CEO Elon Musk surprisingly said that he expects the company to contribute to its cash instead. Today, the company announced that it raised $241 million equity from its solar portfolio in a solar cash equity transaction with Sammons Renewable Energy (SRE).
That's more than TSLA received in Q3 from their zev credits! If SCTY is aside, from this income, even close to cash flow neutral this could make a big positive impact on the Q4 financial numbers. If so how much can they get that way? Enough with the MS-MX income plus TE income to fund the M3 ramp internally?
I think that would be great for our March calls!
racer26
Active Member
Good point, though it might be a bit early to think that SCTY could add significant juice to the 4Q16 financials - its only been a part of TSLA for the last 5 weeks or so of the quarter. Only so much time to work that sort of financial wizardry. I said a while ago though, that bringing SCTY into the TSLA fold was a brilliant piece of financial engineering to save one company, floundering because of poor access to financial markets, while also providing much needed cash to the other one at a critical turning point in the company's history.
That being said, TSLA was pretty close to being breakeven on its own ignoring ZEVs last quarter, and most of the actions taken this quarter are accretive to margin or ASP or both, and the VIN trackers seem to show data that would suggest we're on track to meet or exceed the 3Q16 deliveries count. I expect that as Elon said, TSLA will be quite profitable this quarter if you ignore the CapEx increasing for M3. There's a chance we're profitable even including that.
The biggest question mark for me - and I think the biggest risk factor to a sell-the-news type event on the 4Q16 ER - is how much money do we need to see on the CapEx line to keep the 'Model 3 will be late because they're not spending enough on it' argument at bay? Clearly, the initial guidance for Model3 CapEx was way off, as so far we're WAY under it. I'm not sure we should hold those March calls through the ER, since even if positive, the reaction by the market might not be. I believe the deliveries announcement will be good, and the Jan4 GF event is likely good (my hypothesis is that it is showing cell production online and producing PowerWall2's to start delivery immediately - I really hope they don't announce another as-yet unseen product - that would be seen poorly, like they're biting off more than they can chew).
Really, I believe the ER will be good too, but I think its riskier than the others to hold riskier shorter term options through.
sundaymorning
Active Member
There's a reason why they call it (options) "a suckers bet." Buy shares...
I corroborate this. A wife that needs to pee, three kids, two small dogs to walk around a bit - the car is normally waiting for us!
I agree with much of this but would caution that the somewhat extreme swing in the dollar since the US election could cancel out some of the gains on ASPs and margins this quarter.
According to FRED data, the US dollar has increased about 7% against a basket of currencies since 9/30. Trade Weighted U.S. Dollar Index: Major Currencies
While Tesla will have some offsetting reduced costs from parts suppliers and operations outside the US, this seems likely to be a significant headwind on margins and ASPs.
I still think we'll likely hit guidance on margins because there are so many positives this quarter, but it seems like a blow-out quarter on margins is less likely, and this will also tend to dampen earnings. Should be less of an issue in Q1 as Tesla has already announced price increases to address the currency issues, and still seems to have ample demand.
Positive article from WSJ: Investors Get Ready for the Coming Electric Car Revolution
(use google to get around paywall: Investors Get Ready for the Coming Electric Car Revolution - Google Search )
Hope you all had a good Christmas!
(use google to get around paywall: Investors Get Ready for the Coming Electric Car Revolution - Google Search )
Hope you all had a good Christmas!
I have not found any reference to a Tesla currency hedge except for the yen hedge (for Panasonic batteries) but if I missed something hopefully someone will point it out.
The latest 10-Q highlights currency risks in a few places. A couple key examples are below. FWIW, I don't think this is just "CYA" disclosure -- historically a strengthening dollar has impacted Tesla's margins and unless they have additional hedges that I am not aware of the strengthening dollar could be a factor again.
As noted above, I don't see this as cause for alarm, but is a potential counterweight against the long list of positive impacts on margins and ASPs in Q4 (less of an issue in Q1 2017 after already announced price increases take effect).
In addition to expanding our vehicle production and deliveries, we expect to continue to lower the cost of manufacturing our vehicles over the next several quarters due to economies of scale, material cost reductions and more efficient manufacturing. We expect that this trend will contribute to improve total automotive gross margin over time, excluding the impact of foreign currency movements.
Foreign Currency Risk
We transact business globally in multiple currencies. Our international revenues, as well as costs and expenses denominated in foreign currencies, expose us to the risk of fluctuations in foreign currency exchange rates against the functional currencies of our foreign subsidiaries and against the U.S. dollar. Upon consolidation, as foreign exchange rates vary, revenues and expenses may be significantly impacted and we may record significant gains or losses on the remeasurement of monetary assets and liabilities, including intercompany balances. As of September 30, 2016, our largest currency exposures are from the euro, Chinese yuan, Hong Kong dollars, and Japanese yen. We recorded foreign exchange loss of $3.9 million in other income (expense), net, for the nine months ended September 30, 2016 related to the impact of changes in exchange rates on foreign currency denominated monetary assets and liabilities.
We considered the historical trends in currency exchange rates and determined that it was reasonably possible that adverse changes in exchange rates of 10% for all currencies could be experienced in the near term. These reasonably possible adverse changes in exchange rates of 10% were applied to total monetary assets and liabilities denominated in currencies other than the functional currencies as of September 30, 2016 to compute the adverse impact these changes would have had on our income before income taxes in the near term. These changes would have resulted in an adverse impact on income before income taxes of approximately $259.0 million, recorded to other income (expense), net, principally from intercompany and cash balances.
In November 2015, we implemented a program to hedge the foreign currency exposure risk related to certain forecasted inventory purchases denominated in Japanese yen. The derivative instruments we use are foreign currency forward contracts and are designated as cash flow hedges with maturity dates of 12 months or less. We do not enter into derivative contracts for trading or speculative purposes. We document each hedge relationship and assess its initial effectiveness at the inception of the hedge contract and we measure its ongoing effectiveness on a quarterly basis using regression analysis. During the term of an effective hedge contract, we record gains and losses within accumulated other comprehensive loss. We reclassify these gains or losses to costs of automotive sales in the period the related finished goods inventory is sold or over the depreciation period for those sales accounted for as leases. Although our contracts are considered effective hedges, we may experience small amounts of ineffectiveness due to timing differences between our actual inventory purchases and the settlement date of the related foreign currency forward contracts. Ineffectiveness related to the hedges is immaterial as of September 30, 2016. As of September 30, 2016 we had recorded a cumulative gain of $19.2 million to AOCI related to our outstanding foreign currency cash flow hedges. If the U.S. dollar had strengthened by 10% as of September 30, 2016, the gain recorded in AOCI related to our cumulative foreign exchange contracts before tax effect would have been reduced by approximately $10.4 million.
We are exposed to fluctuations in currency exchange rates, which could negatively affect our financial results.
Our revenues and costs denominated in foreign currencies are not completely matched. As we have increased Model S deliveries in markets outside of the United States, we have much higher revenues than costs denominated in other currencies such as the euro, Chinese renminbi, Norwegian kroner, British pound and Canadian dollar. Any strengthening of the U.S. dollar would tend to reduce our revenues as measured in U.S. dollars, as we have historically experienced. In addition, a portion of our costs and expenses have been, and we anticipate will continue to be, denominated in foreign currencies, including the Japanese yen. If we do not have fully offsetting revenues in these currencies and if the value of the U.S. dollar depreciates significantly against these currencies, our costs as measured in U.S. dollars as a percent of our revenues will correspondingly increase and our margins will suffer. Moreover, while we undertake limited hedging activities intended to offset the impact of currency translation exposure, it is impossible to predict or eliminate such impact. As a result, our operating results could be adversely affected.
Foreign Currency Risk
We transact business globally in multiple currencies. Our international revenues, as well as costs and expenses denominated in foreign currencies, expose us to the risk of fluctuations in foreign currency exchange rates against the functional currencies of our foreign subsidiaries and against the U.S. dollar. Upon consolidation, as foreign exchange rates vary, revenues and expenses may be significantly impacted and we may record significant gains or losses on the remeasurement of monetary assets and liabilities, including intercompany balances. As of September 30, 2016, our largest currency exposures are from the euro, Chinese yuan, Hong Kong dollars, and Japanese yen. We recorded foreign exchange loss of $3.9 million in other income (expense), net, for the nine months ended September 30, 2016 related to the impact of changes in exchange rates on foreign currency denominated monetary assets and liabilities.
We considered the historical trends in currency exchange rates and determined that it was reasonably possible that adverse changes in exchange rates of 10% for all currencies could be experienced in the near term. These reasonably possible adverse changes in exchange rates of 10% were applied to total monetary assets and liabilities denominated in currencies other than the functional currencies as of September 30, 2016 to compute the adverse impact these changes would have had on our income before income taxes in the near term. These changes would have resulted in an adverse impact on income before income taxes of approximately $259.0 million, recorded to other income (expense), net, principally from intercompany and cash balances.
In November 2015, we implemented a program to hedge the foreign currency exposure risk related to certain forecasted inventory purchases denominated in Japanese yen. The derivative instruments we use are foreign currency forward contracts and are designated as cash flow hedges with maturity dates of 12 months or less. We do not enter into derivative contracts for trading or speculative purposes. We document each hedge relationship and assess its initial effectiveness at the inception of the hedge contract and we measure its ongoing effectiveness on a quarterly basis using regression analysis. During the term of an effective hedge contract, we record gains and losses within accumulated other comprehensive loss. We reclassify these gains or losses to costs of automotive sales in the period the related finished goods inventory is sold or over the depreciation period for those sales accounted for as leases. Although our contracts are considered effective hedges, we may experience small amounts of ineffectiveness due to timing differences between our actual inventory purchases and the settlement date of the related foreign currency forward contracts. Ineffectiveness related to the hedges is immaterial as of September 30, 2016. As of September 30, 2016 we had recorded a cumulative gain of $19.2 million to AOCI related to our outstanding foreign currency cash flow hedges. If the U.S. dollar had strengthened by 10% as of September 30, 2016, the gain recorded in AOCI related to our cumulative foreign exchange contracts before tax effect would have been reduced by approximately $10.4 million.
We are exposed to fluctuations in currency exchange rates, which could negatively affect our financial results.
Our revenues and costs denominated in foreign currencies are not completely matched. As we have increased Model S deliveries in markets outside of the United States, we have much higher revenues than costs denominated in other currencies such as the euro, Chinese renminbi, Norwegian kroner, British pound and Canadian dollar. Any strengthening of the U.S. dollar would tend to reduce our revenues as measured in U.S. dollars, as we have historically experienced. In addition, a portion of our costs and expenses have been, and we anticipate will continue to be, denominated in foreign currencies, including the Japanese yen. If we do not have fully offsetting revenues in these currencies and if the value of the U.S. dollar depreciates significantly against these currencies, our costs as measured in U.S. dollars as a percent of our revenues will correspondingly increase and our margins will suffer. Moreover, while we undertake limited hedging activities intended to offset the impact of currency translation exposure, it is impossible to predict or eliminate such impact. As a result, our operating results could be adversely affected.
Last edited:
Nice article! Hopefully with the New Year we'll see more like this -- people stepping back and realizing that BEVs are coming soon.
Will also be interesting to see how the market digests the significance of Supercharger v.3, especially as more details are released. This should wipe out the last major reason to buy an ICE -- a 10-15 minute recharge on long trips (guesstimate) would basically be the time it takes to gas up and go to the bathroom or buy a drink or snack. A new article from Electrek today highlights this point. Tesla’s upcoming ‘Supercharger V3’ is the last piece of the EV adoption puzzle – and means more ZEV credits
- Status
Similar threads
- Locked
