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Why the atypical early release of Q1 guidance?

Discussion in 'TSLA Investor Discussions' started by CapitalistOppressor, Apr 2, 2013.

  1. CapitalistOppressor

    CapitalistOppressor Active Member

    Jun 18, 2012
    Since Tesla updated their guidance on Sunday evening (before the quarter had even technically ended), I'd been assuming that it was related to Elon's announcement on Tuesday.

    I no longer see any connection. Am I wrong to think this? Was there a connection I do not see?

    If there was no connection, that means that Tesla made a business decision to update their guidance late on the evening of the 31st. Why?

    Anyone have any theories?

    Legal requirements?

    Goose the stock price??

    I don't get it. It made Elon look foolish by making his Tuesday announcement look anti-climactic. Why not combine the announcements? Why not hold the guidance until the shareholders meeting?

    Why does it matter that owners looking at their VIN's were going to know that Tesla was doing well? Is that a reason for the announcement or is that just a throw-away line?

    It doesn't make sense to me, and while I made a boatload of money as a result of the announcement, it's just freaking me out a little bit. Enough so that I exited the stock almost as soon as I read the headline of their press release. Well, that plus I found the non-lease leasing program to be somewhat underwhelming, and while Elon committing himself to personally support the resale value of the car is nice, it's not the kind of investment I'd like to see.
  2. Curt Renz

    Curt Renz Active Member

    Mar 5, 2013
    #2 Curt Renz, Apr 2, 2013
    Last edited: Apr 2, 2013
    For those considering the financing deal, the profit announcement inspires confidence that Tesla Motors will survive, thus supporting Model S's trade-in value and providing assurance that the company will uphold its part of the buy-back deal. I doubt that short term movements in share price were a big consideration other than to possibly strike fear into he hearts of short sellers. Spreading demand across a wider consumer base should enhance the value of the stock in the longer term.
  3. luvb2b

    luvb2b Member

    Mar 18, 2013
    no connection. you probably saw my q1 eps and reservations model?

    production and deliveries are over 500 a week, so the manufacturing efficiencies have most likely been worked out.

    the immediate problem now is boosting reservations. i estimate the reservations pace is currently 3500 a quarter vs production of 6500 per quarter. they can make it thru the year but 2014 is a concern. elon needs to boost reservations by 50+% by 2014 to avoid having idle capacity.

    so he is on a marketing blitz. raising awareness and trying to build consumer confidence in a new company.

    worried that tesla can't make money? we did.
    worried you will buy and take a bath? we, or me, will guarantee resale.
    worried about how to pay for it? we will arrange financing.
    worried about road trips? supercharger announcement coming soon
    worried about service? service announcement coming soon

    in sales terms, he is answering the objections people may have.

    the strategy is correct in direction and makes perfect sense. the implementation is not the best.

    go back and listen to the last call. it was all about manufacturing efficiency. the next call is going to be all about boosting sales and he will have three quarters to figure it out.
  4. kenliles

    kenliles Active Member

    Jun 7, 2012
    And the lease program will really help underpin that opening new markets. I agree, looks like they have the mfg efficiencies out (albeit on going improvements always a priority ). Now developing sales, marketing (along with reaching profit margin) are the goals at hand. Right on target IMO. Way too early to judge implementation not the best though

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