Sunrun and Sales Cost

[TheTalkingMule]

Just as Tesla moves to online residential solar sales, Sunrun has announced their 1Q19 numbers. Lo and behold.....costs per kW installed are still absurd.

$3.46/W in costs to Sunrun translates to a $89M quarterly loss. "Project value per Watt", which I guess could be referred to as a customer prices, was $4.52. That is quite obviously insane.

These guys have continued the exact SolarCity model and their sales team is likewise keeping per install costs flat as they scale by 27% year over year. Looking to track their progress over the next 12 months as I think they'll make a great buyout target for Tesla next year once they're relegated back to 2nd place.

 

[JFChenger]

They are a joke. I had them coming this week for the initial sales meeting. They pushed HARD on their leasing option AFTER I told them TWICE that I'm paying cash, and never followed up with the actual quote despite my asking them to send it during the in-person meeting and a follow-up email. The sales guy was nice enough as a person, worked up a quote real-time during the meeting, but their sales tactic was terrible and the price was $3.8+/watt (before any incentives). They even tried to tell me my state incentive was included in their price so "you don't have to be hassled to get paid by the state".

 

[Schroeder0202]

Yes I have also got sunrun and vivant quotes. Sunrun has flat out ignored my request as well for buy figure. Vivant has been great however their price sucks. I had my home inspection w tesla last Saturday and I am still waiting for my proposal. Getting quotes for a 12kw system. Vivant came in about 3.70$ per kwh. If Tesla’s online prices are accurate they should be 2.69$ before incentives. If that’s the case Tesla has my business. The sales rep at vivant is very nice and doesn’t understand how tesla can even get to that price so I told her I would fwd her the quote once I get it.

 

[TheTalkingMule]

I thought you had to order directly online to get that good pricing from Tesla? Would be interested in a summary of your process up to the point of signing.

 

[TSV2000]

Yeah, totally unresponsive. They never sent a copy of the quotes generated in the sales meeting. No information in the account on their website. Then they ping me every few months on email and I reply asking for an update quote and no response.

 

[kengchang]

Wow and people thought Tesla was bad...

 

[SoundDaTrumpet]

It’s pretty obvious that after the house visit there is minimum sales price point (before escalating to higher decision makers). The fact they came by and inspected/photograph your panel is worth some dollar figure (labor cost). With a virtual self-inspection, no truck roll, homeowner takes photos and annotate them. It is your ‘free’ time vs. their paid time. I have offered virtual site visits, video calls, and in all cases they accept, but they don’t present it as an option unless prompted.

 

[TheTalkingMule]

Looks like the stock dropped about 10% after hours yesterday and gained back a bit today settling at -6.45%

Let them keep expanding for another 12 months then buy them out for the familiar $2.2B

Wonder if Lynn Jurich would be willing to stay around after we fire all their salespeople and run residential solar+Powerwall installs for Tesla? Probably not, but you never know. Maybe Elon will be thinking about exiting by then and she'll find that palatable....

 

[TheTalkingMule]

Vivint just came in even worse.

• Cost per Watt was $3.46, an increase from $3.18 in the fourth quarter of 2018 and an increase from $3.22 in the first quarter of 2018.

These are basically just sales orgs and the solar is an afterthought.

If and when Tesla gets to a point where online sales can satisfy most customers needs, they'll just trounce everyone else and take as much share as they like.

 

[Schroeder0202]

So I got my Tesla proposal today. Looks very attractive.
Now I live in IL and apparently they have instant rebates avail called the adjustable block program which
takes $ right off the top not financed based on the amount your system will produce.
Bringing the cost to $1.74 per kwh including installation.
After the Federal tax rebate bringing it down to .94 per kwh.

I am waiting for a new quote and design. I did not like the panel placement on some portions.
Also when I put down my initial deposit on tesla.com I only put in for a 12kw system and no powerwall.
When the inspector came out I told him I wanted a price w and without a powerwall but that was not relayed even
though he took pics of placement for it etc. Other interesting this is the contract shows entire completion 60-120 days from signing which seems very good.
We also have net metering here in IL so from what I have been told I do not need a powerwall, however we get lots of power outages and need some sort of battery back up. Ive gotten prices on a whole house generator and they are 8+ thousand so all around this seems like a great deal.

Any thoughts or opinions?

 

[TSV2000]

Schroeder0202, what type of panels and interverters did they quote you? Wow, that is such a good state incentive. Even more than the federal. Everyone in IL should be getting solar. What's your estimated payback time? Like 2-3 years?

 

[kengchang]

Holy crap, that's one heck of state incentive. I envy you!

 

[Schroeder0202]

I cannot access my design at the moment, they are re-doing it so the old link is dead where I can view
the type of panels/inverters etc. Once I get it back ill be sure to post.

Waiting to see what my powerwall est comes back as well which I can post to see difference between a 12kw w and w/o powerwall installation. They stated if I want to run the house I would need two however I just want for back up as we have net metering here in IL so there really is no need for the powerwall as our grid stores excess then supplies back

update to come/said 24 hrs to redo design and move some panels around etc....

 

[Schroeder0202]

I cannot access my design at the moment, they are re-doing it so the old link is dead where I can view
the type of panels/inverters etc. Once I get it back ill be sure to post.

Waiting to see what my powerwall est comes back as well which I can post to see difference between a 12kw w and w/o powerwall installation. They stated if I want to run the house I would need two however I just want for back up as we have net metering here in IL so there really is no need for the powerwall as our grid stores excess then supplies back

update to come/said 24 hrs to redo design and move some panels around etc....

Even the tesla design guy was like wholly shitake mushrooms that is one hell of state rebate right off the top, said it was the largest he has seen... they must not do too many installs here in IL

 

[TheTalkingMule]

Can you put this convo in the Tesla $ thread? Very interesting stuff going on in IL!

 

[TheTalkingMule]

Finally some mention of sales cost in the media...

High Sales Costs Hurt Residential Solar Companies

 

[TheTalkingMule]

Sunrun down 20%+ since announcing 2Q19 earnings after hours Wednesday. Main issue.....intractable sales cost.

Everything is growing at Sunrun – including customer acquisition costs

The elephant in the room

Sunrun brought down the “creation cost” of systems it financed – including those installed by its dealer network – to $3.33 per watt this quarter, but in the first half of 2019 this cost has been higher than in 2018 or even 2017. This is largely due to one category that keeps rising: sales & marketing.

Sales and marketing expense climbed to $0.80 per watt in Q2, which is higher than at any point since 2015. When asked by pv magazine about these costs in an interview last month, CEO Lynn Jurich largely dodged the question, instead focusing on the company’s work on reducing permitting costs and delays.

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[TheTalkingMule]

Sunrun stock has been riding TSLA's coattails, so it might make sense to strike while your up......but this is a terrible move. Vivint is simply a more bloated version of Sunrun.

U.S. home solar installer Sunrun to buy Vivint Solar for about $1.46 billion

$3.2B including debt. Can't imagine what Sunrun's financials are gonna look like for the next year.