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Tesla Posts 13th Straight Loss, Says On Track For Second-Half Deliveries (reuters.com)
An anonymous reader quotes a report from Reuters: Tesla Motors Inc reported its 13th straight quarterly loss as a rise in sales of its Model S and Model X electric cars failed to make up for the huge cost of ramping up production. The company, run by Silicon Valley entrepreneur Elon Musk, said on Wednesday it was on track to deliver about 50,000 new Model S and Model X vehicles during the second half of 2016. Shares of Tesla, which has offered to buy solar panel installer SolarCity Corp for $2.6 billion, were volatile in after-hours trading. They were last up 1 percent. Tesla delivered 14,402 vehicles in the second quarter, missing its goal of 17,000. It delivered 14,810 vehicles in the first quarter, which was also less than its expectations. Tesla said its net loss widened to $293.2 million, or $2.09 per share, in the second quarter, from $184.2 million, or $1.45 per share, a year earlier. Total revenue rose 33 percent to $1.27 billion in the quarter ended June 30. In addition to acquiring SolarCity, Tesla has unveiled its massive $5 billion Gigafactory in Nevada last week and announced its "Master Plan, Part Deux" not too long before that, which includes manufacturing electric trucks and buses, as well as a ride-sharing program.
Ford and GM stocks are stable and over-inflated making shit no body wants.
Sometimes I hate what modern economics have done to us.
They really need to take Charge of their profits. Things are looking very Negative for them. The Current situation is dire. These losses are simply reVolting. They need to Amp up production and eliminate all Resistance. It's coming down to the wire, time to think Positive.
communism don't it. This is why you should buy American, like Chrysler/Jeep!
negative means positive
doesn't look good for the home team.
When asked how the company can survive by selling each unit at a loss, Elon Musk responded "Although Tesla sells each vehicle below the cost to manufacture, we will attain profitability by selling in volume".
The truth of the matter is that at the prices they're being sold for, most people want a Ford or GM far more than they want a Tesla.
Early adopter costs are high. Then, production of commodity items ramps up and they're sold at a more reasonable price. There are intermediate steps along the way with progressively larger prouction, lower cost, less flashy models.
This isn't just a modern high-tech phenomenon. The internal combustion automobiles went through it, too. They started as rich-people's playthings/status symbols and worked down through things like country-doctor housecall vehicles before Ford's commodity "A" and "T" vehicles put them within reach of the mass of the population. Why should new-tech battery-electric cars be any different?
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
As it turns out, businesses are like the governments in that you can't reconcile their economies in the same manner as your personal budgeting.
The leading number? That's Elon Musk's salary from Tesla, and I believe he is making California's minimum wage with that. Folks who can afford to roll with that kind of backstory play by different rules, too.
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway
I find it humorous that Reuters, a publication for adults to get business and investing news, has the following warning: "(Editor's note: This story may contain language in paragraph 9 that may offend some readers)." If you are reading the article and cannot take a direct quote of Musk saying the word "shit," then you have bigger problems in life and should probably seek therapy.
Not making a profit because you are ramping up production faster than you make the money back is at least the best reason to post losses.
In theory, you could switch to gains just by stopping the ramp up.
While orders for nearly all other car makers are slowing down, Tesla continues to grow faster. In fact, it has always been ahead of supply.
And upon looking at competitors to Model X, we can see that they are also slowing down FASTER than the average.
I prefer the "u" in honour as it seems to be missing these days.
Does no one else see that the oil barons artificially lower prices and drive out competition when it pops up? Oil is by far still the cheapest form of energy and they want to keep it that way. This will continue until they have nothing to offer and we all fall off the cliff.
Tesla motors is a shell game and a scam only benefiting Musk's ego. Investors are losing money as it fails to profit now, and faces increasing safety problems leading to risk of both regulatory action stopping sales and risk of class action lawsuit damages.
Tesla sold >50K cars in 2015 and is on track to sell >80K cars in 2016. The WSJ reports ~10K in 2015 for some reason.
Tesla sells cars as fast as they can make them; they already sell a lot of cars, and they are increasing production by >1.5x per year. Extrapolate out a few years and GM & Ford are very worried.
How fickle the consumer is. Right now gas is cheap and anything other than pick ups and big SUV's are dying. The reality of consumer buying traits is that whatever is positive for them is good. Dealing with a Tesla is harder than dealing with a cheaper bigger vehicle you can stop at any gas station. Fill up and driver 400 miles.
You don't have to plug it in, or deal with a limited support system, or be concerned the company could simply vanish in 5 years. I get that some people are all in on buying a Tesla still. But you are not a movement that is growing in leaps and bounds.
One third.
Let's remember that they are still a small company. More important is getting the company structure right and people to deal with future growth.
It's easy to see that once they break even the other car manufacturers will be knocking down their doors just to do collaboration deals since they will be so far behind. If they produced 200,000 vehicles a year they wouldn't be a threat.
It's all about the batteries. It's the most expensive part of the car. And the new gigafactories by 2020 will drive cost down at least by a conservative 50%.
The hard thing right now is getting quality batteries for electric vehicles. Once the batteries pass quality control and validation we will see staggering growth in units delivered and actually turning a profit.
If Tesla produced a 1/4 ton truck people would be breaking their pens trying to write a check fast enough. But to be fair that won't happen til they turn profitable and so I think that will actually be a collaboration with a couple truck companies since they have never produced a truck before. That would make more sense to me.
More interesting would be if Tesla got a contract to produce short busses with automatic driving. Could be a hybrid possibly. It will take a few years of validation with a driver behind the wheel before we see the first true driverless bus. They could also be used be someone like Uber. After that the sky is the limit for delivery, garbage, and street sweepers.
https://en.wikipedia.org/wiki/Cost_of_goods_sold#Cost_of_goods_made_by_the_business
Basically as you produce something the various people involved learn what needs to be done and streamline their work. This allows production to increase for a set amount of time with no other inputs. I would guess that Musk set his price based on an anticipated learning factor that will have the cost of the vehicles be profitable in the future but currently is at a loss. The learning factor tends to be steeper for production lines that are partially or totally without a precedence from which to take experience (such as the mass production of electric cars which has not happened in the US before. The V-22 is another partial example). This extra steepness makes betting on the learning factor allowing future profitability have less risk than would be expected. It also allows prices to remain more constant and avoids sticker shock preventing customers from buying early, which prevents production, which prevents the learning factor from occurring, which causes customers to keep waiting.
Electric cars are sold as green. This is a gimmick. You can point to the fact they don't directly run on oil, but the reality is it takes a hell of a lot of oil to make 1 electric car. Just one tire takes something like 11 gallons of oil to make. The machinery you have to tool to make the parts takes a lot of oil, as does running the machinery to build the car.
They are not green. It is a gimmick to sell sports cars to the uninformed. Never mind that they only go so far and you have to charge them.