Short-Term TSLA Price Movements - 2016

[Electrifying]

I could easily be wrong here, but I think a lot of this is attributable to customers paying for their car before it's delivered, at which point the money goes from a deposit to earned revenue. It is possible to pay in full at delivery, but a lot of people pay days or weeks ahead when Tesla asks them to. On average Tesla is delivering ~2000 cars/wk now, so if the average person pays a week ahead of time then Tesla is sitting on $200 million in deposits from this (2000 cars x $100g ASP).

I don't think this is correct. These would be advance payment and would be recorded as "Deferred Revenue" on the balance sheet.

What is 'Deferred Revenue'
Deferred revenue, or unearned revenue, refers to advance payments for products or services that are to be delivered in the future. The recipient of such prepayment records unearned revenue as a liability on a balance sheet, because it refers to revenue that has not yet been earned, but represents products or services that are owed to a customer.



Read more: Deferred Revenue Definition | Investopedia Deferred Revenue Definition | Investopedia
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[Drivin]

That is what happens when you move the time table up 2 years on the Gigafactory, and accelerate Model 3 ramp, and build one new store EVERY 4 Days! AWESOME! !

So you are saying that Tesla didn't know ANY of this when they announced previous earnings and set expectations just 3 months ago.

Wow. That is interesting.

 

[maoing]

I'm pretty sure that's the case as customer deposit question was asked in one the CCs last year, Deepak said not to pay too much attention for the fluctuation as it includes the paid in advance money. I'm tired to dig through all those CC transcripts, but just FYI.

I don't think this is correct. These would be advance payment and would be recorded as "Deferred Revenue" on the balance sheet.

 

[3Victoria]

Great hangout. Thanks. David.

 

[BornToFly]

Wow, Tesla requires that you pay in full while waiting for delivery!
That is interesting. Never seen that in a premium car market before - usually just a $1-2k deposit which is partially or fully refundable.
Who else does this?

Are you for real?!? They do not require you to pay in full while you wait. You can pay by check when you pick up the car. If you are doing financing through a third party, it is good to have that done a few days before delivery so delivery doesn't get held up.

 

[sub]

Wow, Tesla requires that you pay in full while waiting for delivery!
That is interesting. Never seen that in a premium car market before - usually just a $1-2k deposit which is partially or fully refundable.
Who else does this?

No one would pay in advance for another manufacture's car. See what I did there? I can twist the facts just like you can. Congrats though, you made my distinguished ignore list after one post (that I saw), new record. Bye now.

 

[BornToFly]

So you are saying that Tesla didn't know ANY of this when they announced previous earnings and set expectations just 3 months ago.

Wow. That is interesting.

I don't recall Elon ever saying what earnings per share would be for Q2 at the end of Q1. Anyone with two brain cells to rub together knows that a 5 Billion dollar factory and a new production line and new stores will cost capital up front. But they will be worth much more than the initial expense once they are up and running and profitable.

 

[DriverOne]

I find it interesting that Tesla is downplaying any profit from ZEV credits. It didn't even come up in the Q&A.

ZEV *did* come up in the Q&A, and Elon got quite heated about it. The ZEV credits, he says, can only be sold at pennies to the dollar and CARB should be ashamed of themselves. ZEV credits are insignificant to earnings because Tesla makes barely any money on them.

 

[3Victoria]

Summary:
Focus is on Model 3 and full Autonomy.
The ramps are sigmoid, and while it is relatively easy to predict the linear midsection, the initial accelerating first part is more difficult to predict.
TE needs to wait for GF to produce cells. At the moment they are doing the test installs and ramping up the support services -- thats where SC is useful. `
An integrated solar cells/battery pack/inverter will be more painless for the consumer.
Y and minnibus are projects that can be developed without much capital expense, until they start production, so the planning and design can proceed over the next year, say.
Bright future.

 

[mmd]

I missed the answer on Barclay's analyst on M3 reservations. Was the latest M3 reservation count disclosed?
If it wasn't disclosed, I'm hoping it will be there in the SEC filing within 2 weeks.

 

[3Victoria]

They stated on the call: the official count remains at 373,000.

Edited for clarity.

 

[RobStark]

The official count remains at 373,000.

Like Tesla said before, they will no longer make public updates.

Like Julian Cox said, that is very valuable marketing data. It is enough for legacy automakers to know that demand for BEVs that are directly competitive in their price segment is " a lot."

 

[Drumheller]

No one would pay in advance for another manufacture's car. See what I did there? I can twist the facts just like you can. Congrats though, you made my distinguished ignore list after one post (that I saw), new record. Bye now.

When I bought my CPO in January, I did, in fact, have to pay up front before I saw the car.

 

[MTL_HABS1909]

The official count remains at 373,000.

While I'm convinced the Model 3 will be a huge success, this answer was a little sketchy. I think there may have been quite a few cancelations recently due to people going for the S60 or just cancelling when they realized what a huge purchase this will be. However they know that at part II of the reveal, the number of reservations will dwarf what we've seen. So as a shareholder, I'm quite happy with the evasive answer !

 

[BornToFly]

When I bought my CPO in January, I did, in fact, have to pay up front before I saw the car.

Did they have to ship it to you from another store?

 

[3Victoria]

Re: reservations. yes, the actual number is moot, since we know it will grow. Jumping to S60 is not really a concern, and is beneficial, since a $ in hand is worth 2 in the bush (queue).

 

[mmd]

While I'm convinced the Model 3 will be a huge success, this answer was a little sketchy. I think there may have been quite a few cancelations recently due to people going for the S60 or just cancelling when they realized what a huge purchase this will be. However they know that at part II of the reveal, the number of reservations will dwarf what we've seen. So as a shareholder, I'm quite happy with the evasive answer !

Yes, you are right. Unless the count is lower, and then you are wrong. Just curious, when you say "will dwarf what we've seen.", what kind of number do you have in mind?

 

[techmaven]

Yes, you are right. Unless the count is lower, and then you are wrong. Just curious, when you say "will dwarf what we've seen.", what kind of number do you have in mind?

Actually, there is a problem with announcing a higher number. It discourages people to be that far behind in the line, especially combined with so many nay-sayers saying that you won't see a car you ordered until 2020 or later.

 

[Drumheller]

Did they have to ship it to you from another store?

Yes. It was coming from California to Arizona. However, I did not have to pay before it shipped. It was at the AZ location before I paid.

 

[BornToFly]

Yes. It was coming from California to Arizona. However, I did not have to pay before it shipped. It was at the AZ location before I paid.

So your initial post on the subject was misleading on purpose?