Gary Black concludes that delivery miss was due to China. And he dresses down those that called him mean names three months ago when he was warning of this. Worth reading the thread anyways.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Pretty sure we'll hear this in 2.5 weeks.
trayloader
Member
That’s the oldschool way of seeing it presented in various forms over the last three weeks.
Obsolete since this afternoon.
The scheme of things to come seems clear now. Raising prices when you could do it, and in a recovering market (saw German outlook- mild to no recession) slash prices, have the better and more compelling product and a redesign of your BLOCKBUSTER around the corner.
Plus an executor like no one else. This is the first time I saw Tom Zhu in a clip. Terminator 3.0. China speed.
That’s what EM meant by „Coup de Grace“.
While BMW presents ridiculous child dreams in Vegas.
Wow.
Edit: plus throwing in a traditional steering wheel on the S/X Front out of nowhere.
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These across the board, across the world price cuts are absolutely the right move for the company and for the renewable future.
However, I do not believe these are priced into the SP in the least, and the market we are in….
Where is the bottom here if Tesla gets attacked continuously for shrinking margins and profits?
The profits will be fine if Tesla energy contributes a bit and deliveries spike 50% YOY as planned. The long term picture is better than ever, especially because Tesla needs only itself to succeed. 21B in the bank, with I assume another 3-4B from the latest record quarter.
One could argue that the market should reward the SP as Tesla grabs market share and future dominance a la Amazon, but this will take a couple of quarters to show itself, and everything can happen in a couple of weeks as far as the SP is concerned. WS is going to go for the kill here.
Going to be a rough night…
However, I do not believe these are priced into the SP in the least, and the market we are in….
Where is the bottom here if Tesla gets attacked continuously for shrinking margins and profits?
The profits will be fine if Tesla energy contributes a bit and deliveries spike 50% YOY as planned. The long term picture is better than ever, especially because Tesla needs only itself to succeed. 21B in the bank, with I assume another 3-4B from the latest record quarter.
One could argue that the market should reward the SP as Tesla grabs market share and future dominance a la Amazon, but this will take a couple of quarters to show itself, and everything can happen in a couple of weeks as far as the SP is concerned. WS is going to go for the kill here.
Going to be a rough night…
So with the price cuts Tesla will have less margin per vehicle, but volume of sales will increase. I know Elon talked about doing this during his Twitter Spaces interview. I don't know if it's good or bad but I think it's the only choice they have in the current auto market environment.
Got our 2023 Model X LR three weeks ago. Probably would have gotten the wheel to appease my wife if it would have been an option. Put on 3,600 km over Christmas (family visits and ski trips) and we’re really happy with the yoke. I’m glad it wasn’t an option for us. I actually prefer the buttons on the steering wheel to the stalks (to my slight surprise) with only one exception - signaling that I’m about to exit a traffic circle (aka roundabout).
^^
Pricing power and volume saves the day…
trayloader
Member
And dare to repost this favorite pick by Herr Elon. What a machine. Look at the man, listen to what and how he says it here, the competition should tremble. The „iPhone Moment“ never was closer.
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I have said it before and will say it again. IRA for hybrids will not save hybrids. You guys think of hybrids as an ICE with an extra EV powertain. I think of hybrids as an EV with an extra ICE powertrain.
When you have the EV powertrain with 10kWh already and you think if you either should just add 40kWh extra of battery or add another complete ICE powertrain it becomes a nobrainer that you add the batteries.
With IRA batteries will approach $50-100/kWh, so adding that extra 40kWh of batteries will cost $2-4k. Can you get a tank, transmission, engine etc for less than that? Which one is easier to build? Which one will the customers pay more for? Which one requires less service? Which one performs better? Which one is better for the environment? Which one costs less in taxes? Which one will you be allowed to drive in cities in a few years?
Competition might believe that PHEV is an ICE with an extra battery, because that's their mindset and then they might fool themselves into believing it makes sense. But from the EV with an extra ICE mindset it makes absolutely zero sense to add the ICE...
Hybrids will very quickly be eaten alive by cheaper EVs. It's a distraction to talk about hybris, yes the IRA is silly to include them, but it's just a blimp in the history anyway, their time is soon running out.
When you have the EV powertrain with 10kWh already and you think if you either should just add 40kWh extra of battery or add another complete ICE powertrain it becomes a nobrainer that you add the batteries.
With IRA batteries will approach $50-100/kWh, so adding that extra 40kWh of batteries will cost $2-4k. Can you get a tank, transmission, engine etc for less than that? Which one is easier to build? Which one will the customers pay more for? Which one requires less service? Which one performs better? Which one is better for the environment? Which one costs less in taxes? Which one will you be allowed to drive in cities in a few years?
Competition might believe that PHEV is an ICE with an extra battery, because that's their mindset and then they might fool themselves into believing it makes sense. But from the EV with an extra ICE mindset it makes absolutely zero sense to add the ICE...
Hybrids will very quickly be eaten alive by cheaper EVs. It's a distraction to talk about hybris, yes the IRA is silly to include them, but it's just a blimp in the history anyway, their time is soon running out.
JusRelax
Active Member
If so, it would be more sensible if every other competing auto manufacturer gets hammered as well on this news... just like Tesla Daily (Rob Maurer) mentioned, how will others compete with Tesla and BYD in China?
Nobody could have seen this coming. Wrights law, Tesla's margins, Tesla guiding 50% long term, Elon saying he would rather have zero margins and grow sales than good margins and constant sales, 4680, LFP, growing margins every quarter for the last few years. Totally blindsided all the competition!
⚡️ELECTROMAN⚡️
Village Idiot
How badly is the stock price going to get pummeled? I’m feeling really uneasy about this. I thought the Tesla Economist was just being paranoid.
Just noticed that his numbers are for 3/Y only. He backed out S/X deliveries and revenue.
bballshinobi
Member
We went down 12% by missing the delivery estimate by 4%? Now we are slashing prices by around 5-10% across different countries.. 15-25%? Lol
So the aggressive price cut is the correct move for Q1, which is seasonally the weakest quarter. It is more cost effective to keep all factories running at full speed than to reduce production to meet demand at a higher ASP Tesla barely recognized anyways. I am expecting prices to start creeping back up q3 onward, especially after a new refresh release.
Based on Pierre's data, it seems that the Model Y/3's price was increased by 12-15k however only 3k was booked and still had a 30% margin(if you exclude Berlin/Texas). This is assuming the baseline is a 50k ASP, however it seems that ASP is even lower than this if we are only using introductory prices of the 3/Y. Some rough calculation put ASP in the 49k ballpark prior to the price jumps. So taking a huge discount from the top price doesn't really mean much.
Based on Pierre's data, it seems that the Model Y/3's price was increased by 12-15k however only 3k was booked and still had a 30% margin(if you exclude Berlin/Texas). This is assuming the baseline is a 50k ASP, however it seems that ASP is even lower than this if we are only using introductory prices of the 3/Y. Some rough calculation put ASP in the 49k ballpark prior to the price jumps. So taking a huge discount from the top price doesn't really mean much.
Okay, so if I understand things correctly: The post ‘miss’ head fake I posited is done-ish; we’ll burble along through the mid-January options deadline and the US est tax deadline; then the short fade likely begins into earnings that redefine (and improve) the numbers, e.g. PE and all its attendant shivery and exciting ratios.
This against a backdrop of a declining the-sky-is-falling narrative—the Fed continues to stamp it’s foot ("I’m weally, weally sewious") and the Street pretends to believe it, but what?; Putin, while continuing to dispose of his male population (a la Toyotomi Hideyoshi’s disposal of Japan’s Samurai in the invasion of Korea), still faces increasing Western military aid; and so on and so forth.
And then? Shouldn’t we see a firming of the stock price and maybe a rise into earnings as I suggested earlier?
By Jove, I think I’ve got it! I do believe I could’ve gone to the Street for a career (but for the fact that I’m couldn’t be a big enough *sugar* to bone retail for a living
)
This against a backdrop of a declining the-sky-is-falling narrative—the Fed continues to stamp it’s foot ("I’m weally, weally sewious") and the Street pretends to believe it, but what?; Putin, while continuing to dispose of his male population (a la Toyotomi Hideyoshi’s disposal of Japan’s Samurai in the invasion of Korea), still faces increasing Western military aid; and so on and so forth.
And then? Shouldn’t we see a firming of the stock price and maybe a rise into earnings as I suggested earlier?
By Jove, I think I’ve got it! I do believe I could’ve gone to the Street for a career (but for the fact that I’m couldn’t be a big enough *sugar* to bone retail for a living
)
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The price declines were inevitable. Demand was an issue in multiple markets. Macros cannot be ignored. However…
www.marketwatch.com
The USD has weakened about 5% since peak late last year. Will probably continue to grind down. Exchange rates were a head wind all of last year for earnings, but are in Tesla’s favor now. Those 7 to 10% price decreases seem negligible between the USD weakening and costs decreasing while volume also ramps. It is not hard to get to a point where it is a wash if sales continue to increase 30% (or more) a year.
The big question is what happens in the US? What is the plan here? Obviously price decreases here affect margins directly as currency rates do not matter. Cost cutting, decreasing commodity prices and volume ramps can improve the margins in USA. The IRA certainly matters, especially if energy storage really is ramping. With the IRA and decreasing COGs and higher volumes, earnings should be very good.
Money is nice, but the ultimate goal is the relentless transformation of the ICE industry to BEV and a renewable world. We have been all admiring how well positioned Tesla was to crush the competition in hard times. Well, they are here and Tesla is executing the crush. It is not without side effects. It could never be any other way.
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www.marketwatch.com
The USD has weakened about 5% since peak late last year. Will probably continue to grind down. Exchange rates were a head wind all of last year for earnings, but are in Tesla’s favor now. Those 7 to 10% price decreases seem negligible between the USD weakening and costs decreasing while volume also ramps. It is not hard to get to a point where it is a wash if sales continue to increase 30% (or more) a year.
The big question is what happens in the US? What is the plan here? Obviously price decreases here affect margins directly as currency rates do not matter. Cost cutting, decreasing commodity prices and volume ramps can improve the margins in USA. The IRA certainly matters, especially if energy storage really is ramping. With the IRA and decreasing COGs and higher volumes, earnings should be very good.
Money is nice, but the ultimate goal is the relentless transformation of the ICE industry to BEV and a renewable world. We have been all admiring how well positioned Tesla was to crush the competition in hard times. Well, they are here and Tesla is executing the crush. It is not without side effects. It could never be any other way.
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Some of us have been saying for a long time that ASP will eventually have to drop as volumes significantly increase. With that in mind, annual earnings projections were made assuming steady ASP declines and they still look very good (just not as good as the numbers from the Uber-super-bulls who insisted ASP would always stay at current levels or even go higher
Still plenty of stupid Uber-bull takes online of course. Just saw one online who now thinks teslas strategy is to sell vehicles at cost and make all their profits on software upgrades. Insert facepalm image.
Still plenty of stupid Uber-bull takes online of course. Just saw one online who now thinks teslas strategy is to sell vehicles at cost and make all their profits on software upgrades. Insert facepalm image.
Good news: as of today the non-plaid Model S and X can be ordered in Europe too.
Base price in The Netherlands 25.000 euro respectively 20.000 euro less than the plaid version.
Also there is a choice between the yoke or round steering wheel.
Base price in The Netherlands 25.000 euro respectively 20.000 euro less than the plaid version.
Also there is a choice between the yoke or round steering wheel.
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