Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[capster]

It's a matter than can affect the share price. IMO, it belongs in this investment thread.

IMO, it isn’t and it doesn’t.

Besides, pretty much everything has been said more than once—often way more—and everyone inclined to venting their spleen on the matter has done so ad nauseum.

 

[Thekiwi]

Tesla California sales in 2023 are a good metric for testing whether the CEO's political activism has caused mass left-wing aversion to the Tesla brand such that vehicle sales have been harmed.

Why this matters:

• California's government provides some of the most comprehensive and detailed EV sales data of any regional market in the world
• California is the most prominent left-leaning state in America
• California is the leading EV market in America in terms of both total volume and EV market share, and since the very beginning it has been a leading indicator for EV growth trends elsewhere
• California and SF Bay Area politics have been the specific target of much of Elon's political activism since 2020

Overall, Tesla has continued to maintain a dominant position in the California EV market in the last couple of years. Tesla's share of the general light-duty vehicle (LDV) market in California is now 13%. This all-time record for Tesla is an increase from 11.7% last year and it is second only to Toyota's 15.7%. Tesla accomplished this with a four-vehicle menu that leaves major gaps in the market unserved, such as pickup trucks, full-size SUVs, compact sedans and compact hatchbacks. In 2023, Tesla achieved 61% BEV market share by selling 230k out of 376k total BEVs with at least 200 miles of nominal range. Tesla outsold the next-best competitor, Chevrolet, by almost 12x. This is approximately the same ratio of Tesla to the 2nd-place BEV competitor that Tesla has enjoyed across the US as a whole for many years. Although 61% is down significantly from 73% from last year, Tesla still posted significant 8.2% growth statewide in 2022. Tesla's market share declined because everyone else grew faster.

California Energy Commission (2023). California Energy Commission Zero Emission Vehicle and Infrastructure Statistics. Data last updated [24 Jan 2024]. Retrieved [2 Apr 2024] from Zero Emission Vehicle and Infrastructure Statistics.

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View attachment 1034868

Spoiler: Tesla sales figures table

All numbers in thousands.

Year	Tesla % BEV Share	Tesla % LDV Share	Tesla Sold	LDV Sold	BEV Sold
2013	42%	0.5%	9	1,773	21
2014	24%	0.4%	7	1,969	30
2015	30%	0.5%	11	2,217	38
2016	45%	0.8%	17	2,207	38
2017	38%	0.8%	17	2,183	46
2018	72%	3.1%	69	2,252	95
2019	74%	3.3%	70	2,154	95
2020	79%	4.5%	83	1,864	106
2021	75%	6.8%	137	2,016	184
2022	73%	11.6%	213	1,835	292
2023	61%	12.9%	230	1,786	380

Tesla's decline in California market share may be disappointing but it is understandable. Both of the US factories, but especially Fremont, are close to maximum output for the S3XY models for the existing production lines. Also, the S3XY models are already so dominant in California that they may be close to their demand limits under current macroeconomic conditions. The Model Y and Model 3 were the #1 and #2 best-selling vehicles of any kind in California, by a wide margin. The Y sold slightly more than the RAV-4, CR-V, Rogue and Tucson combined. There still may be substantial room for this ceiling to grow over time, as awareness increases and the Supercharger network and service center network continue to expand.

Let's zoom out for context:

• 61% share is still double what it used to be before the Model 3 was introduced
• Competitors emerged from the chip shortage in 2023 and thus were much less supply constrained than during the pandemic. The entire automotive industry had a glut of supply, prices dropped across the industry, and dealership inventories grew.
• 2017 saw a similarly large drop in CA BEV market share when S&X sales peaked and 3 was still in the beginning of Production Hell.
• California is the leading state in the USA for selling compliance EVs at a loss, because California is a huge market with stringent regulatory requirements and it is the most lucrative automotive market in the nation. Tesla is selling into a tilted playing field because customers are subsidizing their losses with earnings from ICE and hybrid sales, but this situation won't last forever.
• 2023 was another weak year of growth for the overall automotive market in California. Overall LDV sales were 10% lower than in the peak years of 2015 through 2018.

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Source: California New Car Dealers Association & Experian

California has a overall liberal and leftist population supermajority, but it's a big state with almost 40 million people living it it and it is politically, geographically, culturally, ethnically and economically diverse. The populous coastal counties that comprise the major urban areas are heavily left-leaning, whereas the rural counties are heavily right-leaning, and many other counties are somewhere in between.

In the leftist urban and coastal counties, Tesla did have a decline in their BEV market share from its peak in 2020. In 2023 alone, it declined from 74% to 61%. However, this decline was right in line with the overall trend for California in which Tesla's market share dropped from 73% to 61%. Also, Tesla still showed growth in these left-leaning counties. The only exception was San Mateo county just south of San Francisco and just north of Silicon Valley. San Mateo for some reason had sales collapse by 38% in 2023. I don't have any idea why this happened, but San Mateo is a fairly small market and it was heavily saturated with Teslas until 2022. Despite that lone outlier, overall in the most left-wing counties in California, Tesla actually grew their sales volume by 8.1%, which was almost exactly equal to the Tesla's statewide sales growth of 8.2%.

Even with wide variation in regional demographics, culture and politics, Tesla overall increased sales volume in California pretty evenly throughout the state. Tesla grew the same in woke, socialist metropolises, in liberal suburbs, and in MAGA Trumpland (which does exist in California). Tesla even grew sales by 5% in San Francisco county, which is the bluest county in the state, is the epicenter of the Twitter/X and OpenAI controversy, and has been directly accused by Elon of propagating a radical "woke mind virus" that will destroy civilization as we know it.

View attachment 1034803

Spoiler: Tesla sales for most populous counties

County	2019	2020	2021	2022	2023	% Change YoY
Los Angeles	16809	20902	35844	61573	58374	-5%
Orange	9503	11628	18122	26945	31444	17%
Santa Clara	10122	8963	13072	19908	24593	24%
San Diego	5585	7352	11979	16512	19882	20%
Alameda	5714	5418	8418	12444	15039	21%
Riverside	2031	2917	6111	8961	10635	19%
San Bernardino	1694	2241	4604	7495	9271	24%
Contra Costa	2882	3376	5427	7700	8550	11%
Sacramento	1351	1783	3280	5770	7316	27%
San Mateo	3412	3458	5085	11230	6937	-38%
San Francisco	1933	2801	3806	4914	5171	5%
Ventura	1509	1783	3081	4507	4759	6%
San Joaquin	670	846	1819	3062	4610	51%

Unfortunately, Tesla grew sales in California with the help of large price reductions. However, Tesla also reduced prices by the same amount all across the US and similar amounts in all major EV markets around the world. Also, competitors cut prices on their EVs shortly after Tesla did, and inventory has been piling up at their dealerships. It's important to note that Tesla's online ordering and transparent pricing means that we know they were selling vehicles at the same prices throughout California.

All of this evidence casts major doubt on the belief that Elon's political activism has been the primary cause of growth slowdown and price reductions. It is questionable whether it even is a net factor at all. There has been no observed correlation between the political bias of a local market and Tesla's BEV market share. It appears that the broader tough market conditions have affected the whole EV market in the state and worldwide, with BYD the only other player looking decent in 2023. That being said, a lack of correlation doesn't necessarily mean there was no effect. The urban and coastal areas in California have many differences from the rural areas, so maybe Elon's antics were hurting demand in the metro areas but some other factors were tailwinds in these same areas. Still, the simpler and more likely explanation is that the politics did not have a majorly negative effect. Either way, end result is the same and the data shows no cause for alarm.

This is a good well researched post, but unfortunately only focuses on full year 2023 - and misses the fact that California Tesla sales in Q42023 dropped 10% year on year.

To be clear that is a 10% drop in unit sales in California, not marketshare - in a quarter that was Tesla’s best ever for unit sales globally.

If that trend continues when Q1 numbers come in, we may have a better indication.

 

[Opus BC fan]

I am pleased to report that Lodger is well and dealing with family matters. He plans to return to the forum soon.

 

[MartinAustin]

I am pleased to report that Lodger is well and dealing with family matters. He plans to return to the forum soon.

Lodger? ArtFUD Lodger?

 

[2daMoon]

This is a good well researched post, but unfortunately only focuses on full year 2023 - and misses the fact that California Tesla sales in Q4 dropped 10% year on year.

To be clear that is a 10% drop in unit sales in California, not marketshare - in a quarter that was Tesla’s best ever for unit sales globally.

Oh, good.

So, you were actually wrong throughout 2023 when repeatedly posting unverified FUD along these lines, but now reserve some tiny, cherry-picked sliver as a way to salvage your position?

Right. Good on ya mate.

One will always struggle to see the big picture when focusing so tightly on a single piece of the jigsaw puzzle that all the other pieces remain in a blur.

 

[Gigapress]

This is a good well researched post, but unfortunately only focuses on full year 2023 - and misses the fact that California Tesla sales in Q42023 dropped 10% year on year.

To be clear that is a 10% drop in unit sales in California, not marketshare - in a quarter that was Tesla’s best ever for unit sales globally.

If that trend continues when Q1 numbers come in, we may have a better indication.

I did not know that. Where did you get that info? Even so, a single anomalous quarter right before a Model 3 factory line upgrade does not weaken the overall point by much. If that decline was caused by political ramifications, then that raises the question of why Q4 2023 was different from all the preceding quarters. People have continually predicted that the hypothetical demand impact would take time to be realized, but it’s been 4 years now since this began with Elon’s infamous rant about COVID lockdowns and fascism on an earnings call. There is still no large-scale, high-quality statistical econometric evidence of a politically driven demand problem. At best I’ve seen anecdotes and survey results that suggest the possibility of an effect.

 

[Ipcress]

I noticed the same problem when I bought my MY last year. This was my third Tesla purchase and it was by far the worst experience of the three because it was really hard to get someone local on the phone.

When you are making a big purchase you want to talk to someone on the phone at the place you are buying the car.

Somebody please tweet at Elon about this!

THIS!

My MY purchase in '22 was a stressful mess. Glitches ordering on-line, Questions, but couldn't get a return call/email, always speaking to a different person, no follow-up, and on pick-up day a similar experience, with my insurance incomplete, and no notification before I showed up. It was my first new car purchase, and I was already stressed paying what was a *sugar* load of money for me. Probably bought at the highest price Y's were ever sold for. At pickup, the people I was speaking with kept disappearing, and I'd have to start over with each of the 3-4 people I interacted with. Took hours to get out. It was a clown show. and don't get me started on my attempts to purchase Solar and Powerwall for my house.

This customer service disaster described makes sense to me as a cause of demand fade (with many others as well)--I lived it. And now--apparently--it is worse, not better. Who in their right mind is going to buy a car--an EV is already quite a leap for most people--with multiple strikes against it, without any reassurance? Consumer reports (which many people rely on), and Tesla's poor service center reputation, and the very effective general media FUD. Then, they call to speak with someone and encounter that? Tesla is competing with the likes of Audi, etc., high end places that treat the customers well, and offer exceptional hand-holding and service. Tesla; not-so-much. Don't bother with Elon. He's been too busy with other things...

 

[⚡️ELECTROMAN⚡️]

If there is a demand problem it's because Tesla is Osborneing itself in the short term. Once we get past this, watch out.

 

[ZeApelido]

Rumor has it Elon personally injects little political tweets into the each Gigacasting so every vehicle is politically tainted forever.

 

[alhounos]

Down 5%?? That's nothin'!

I was looking for sub-$150 to scoop some shares. Oh well, we still have the earnings call.

 

[Musskiah]

Tesla sells 89,064 China-made cars in Mar, up 47.5% from Feb​

In the January-March period, Tesla sold 220,876 China-made vehicles, down 3.68 percent from 229,322 in the same period last year, data compiled by CnEVPost showed.

SOURCE: Tesla sells 89,064 China-made cars in Mar, up 47.5% from Feb

And all these new Model 3s waiting in China for export to start Q2. Welp, I think we know where about 10k of the inventory vehicles reside.

Tesla China opens Q2 2024 with massive export efforts

It appears that Tesla China is not missing a beat with its export efforts even as the second quarter of 2024 begins.

www.google.com

What horrible news (dripping sarcasm)

 

[Thekiwi]

I did not know that. Where did you get that info? Even so, a single anomalous quarter right before a Model 3 factory line upgrade does not weaken the overall point by much. If that decline was caused by political ramifications, then that raises the question of why Q4 2023 was different from all the preceding quarters. People have continually predicted that the hypothetical demand impact would take time to be realized, but it’s been 4 years now since this began with Elon’s infamous rant about COVID lockdowns and fascism on an earnings call. There is still no large-scale, high-quality statistical econometric evidence of a politically driven demand problem. At best I’ve seen anecdotes and survey results that suggest the possibility of an effect.

Purely in relation to timing I would mention that what many on the left judge as Elons particularly egregious activity occurred in mid-Nov 2023, and thereafter.

 

[Musskiah]

Malaysia has a car market roughly a third of the size of Germany, or half or the U.K. or Japan Tesla Model Y deliveries start in Malaysia

 

[Dutchie]

I am a sucker who bought into the FSD story from day one. Now I see others who haven’t paid a dime for FSD supervised get it before me on much cheaper cars. Tesla is just forgetting about, us who supported them when the times were rough. Still no FSD supervised for the legacy Model S and. Should have put the money in TSLA instead of FSD.

 

[2daMoon]

Purely in relation to timing I would mention that what many on the left judge as Elons particularly egregious activity occurred in mid-Nov 2023, and thereafter.

Truly amazing how that coincided with the Project Highland upgrade going on at Fremont.

Maybe it was something Elon said that led to this upgrade? Perhaps this is what you are implying?

Though I never considered the new Model 3 as egregious, would a factory upgrade more directly explain a drop in volume?

 

[MC3OZ]

Purely in relation to timing I would mention that what many on the left judge as Elons particularly egregious activity occurred in mid-Nov 2023, and thereafter.

That pile of power at your feet is all that is left of the dead horse, time to give the poor beast a respectful burial.

 

[spacerfc]

Purely in relation to timing I would mention that what many on the left judge as Elons particularly egregious activity occurred in mid-Nov 2023, and thereafter.

Source: Trust me bro

 

[AndrewZ]

I am a sucker who bought into the FSD story from day one. Now I see others who haven’t paid a dime for FSD supervised get it before me on much cheaper cars. Tesla is just forgetting about, us who supported them when the times were rough. Still no FSD supervised for the legacy Model S and. Should have put the money in TSLA instead of FSD.

It might come down to volume and training data, HW3 Model 3/Y are where all the volume are and training the system depends on massive amounts of data. Each vehicle has cameras in slightly different locations, and each hardware configuration will also differ, so its all different training sets.

I’m just waiting for them to call HW3 done and move on to HW4, because HW4 is currently just running HW3 in emulation.

And then onto HW5.

This is how I think it works anyways.

 

[Ellec]

The last earning call it was clearly stated Tesla was between growth phases. They still add billion every quarter to cash reserves. People losing it when the delivery numbers (a snapshot of 3 months) are down QoQ is myopic imo. I was here during the Model 3 ramp when they losing billions every quarter, those days are gone forever. There will be another growth phase, then another in between phase and so on.

 

[AndrewZ]

Delivery numbers are down YoY, not just QoQ.

But Tesla at current valuation is doing fantastically for a car company. Tesla as of today’s close is worth 10 Fords, 10 General Motors, or five of each. Tesla today is worth more then Toyota, Ford, General Morors, Rivian, Lucid, and 313 Fiskers all combined.