[Bongoxxx]

Originally Posted by chad86tsi

sales of government credits for making electric vehicles have boosted the company’s overall revenues. The company’s credit sales totaled nearly $1.5 billion in 2021, while Tesla reported net income of $5.52 billion for the year.
https://news.bloombergtax.com/financ...-boost-profits
.

So Tesla has used government credits…GM wouldn’t exist today without massive bailouts and tax credits…

[KRS_SN]

Originally Posted by Tejas1836

"I still think the pace of BEV transition will be blistering..."
Not without major battery breakthroughs and massive electrical grid upgrades, on the magnitude of ~$6,000 per new EV, which will require breeder reactors.

Govts around the world are mandating it so the trend of less ice being sold cannot be turned back. (customers/carmakers haven't a choice in this which is sad) .

[chad86tsi]

Originally Posted by Bongoxxx

So Tesla has used government credits…GM wouldn’t exist today without massive bailouts and tax credits…

the comments about the credits relate to how profitable Tesla is. They have received massive credits for years, year after year. They aren't paying it back either. Divide the credits and other government subsidies by the number of cars they produce vs other manufacturers if you want to see the significance to the profit margin discussion.

[Bongoxxx]

Originally Posted by Efthreeoh

Sure, but for completely different circumstances.

Sure, completely mismanaged company with overrun costs, I guess we could say that is GM or Tesla, but one went bankrupt and required a bailout.

With or without the EV credits, Tesla would still be here.

[chad86tsi]

Originally Posted by Bongoxxx

Sure, completely mismanaged company with overrun costs, I guess we could say that is GM or Tesla, but one went bankrupt and required a bailout.

How many cars did tesla make per year in 2009, and how many employees did they have?

With or without the EV credits, Tesla would still be here.

Would they be be so profitable per unit?

[Bongoxxx]

Originally Posted by chad86tsi

How many cars did tesla make per year in 2009, and how many employees did they have?



Would they be be so profitable per unit?

What’s your point? GM has about 1/2 the employees it once did. They used to employ 20,000 plus locally here, but now about 5,000. Explain why those jobs are more important than funding companies that are looking to the future and/or developing completely new markets/products?

How many cars did GM make in its first year of existence? How many employees did they have?

How much tax money has GM taken over the years?

My point is you keep pointing that Tesla has been using EV credits to increase profits, great why wouldn’t you if the government is making it available.

GM and the other formerly big 3 have been sucking on the government gravy train for ever.

GM wouldn’t exist today in its current form if it wasn’t bailed out.

[chad86tsi]

Originally Posted by Bongoxxx

What’s your point? GM has about 1/2 the employees it once did. They used to employ 20,000 plus locally here, but now about 5,000. Explain why those jobs are more important than funding companies that are looking to the future and/or developing completely new markets/products?

What is your point?

comparing what happened to/with GM in 2009 to Tesla seems odd. Tesla sold less than 1000 cars in 2009. That they didn't go under is quite a different reality. They were busy getting cash infused with massive (relative to their size) federal loans in 2009. GM was an established and overextended 100 year old company with ~200,000 employees.

It's like comparing the financials of teenager working part time at McDonalds and borrowing federal money to go to community college to a family of 6 working full time in a middle income wage, stuck in a high interest loan on a house with no equity. Then they both lose their job. How many teenagers went bankrupt in 2009? Was that because teenagers are financially more wise? No, their realities and the consequences of their situations were very different. If the Tesla of today was transported back in time and existed in 2009 as it does now, would they survive it?

How many cars did GM make in its first year of existence? How many employees did they have?

Tesla is currently 19 years old. It had it's first profitable year last year, thanks mostly to bitcoin and carbon credits (free money).

How much tax money has GM taken over the years?

You tell me. Be sure to divide it by vehicles produced so we can stay on track re: vehicle per-unit profits.

My point is you keep pointing that Tesla has been using EV credits to increase profits, great why wouldn’t you if the government is making it available.

It is great. It's not a testament to their greatness as others have used it to portray.

GM wouldn’t exist today in its current form if it wasn’t bailed out.

How many established businesses went under in or because of 2009?

[Bongoxxx]

Originally Posted by Efthreeoh

Well, an excerpt from a September 2018 article in the Wharton Business Journal provides the real situation back in 2008:

For Wharton management professor John Paul MacDuffie, the idea of letting GM and Chrysler wither on the vine made no sense. “It could have been a domino-effect collapse of the domestic auto industry.” He adds that the bailout decision made sense partly to avoid a much deeper crisis, but also to make GM and Chrysler more competitive in the future. It was true that U.S. auto companies were “badly managed for a long time. GM lost market share for 30 years. There were these energy crises and there were no fuel-efficient vehicles being made by the Big Three, over and over again.”

The 40% Hit

Yet, that poor record had largely been reversed by the time the crisis hit. When it came to manufacturing capability, product development and supply chain management, the U.S. automakers were close to the levels of “any global manufacturer” in most areas by 2009. They were already in the middle of a large and successful improvement process when the financial crisis hit and they were among the victims, MacDuffie adds. The auto companies were not involved in causing the financial crisis. But then, he asks, what business dealing in expensive, capital-intensive durable goods takes a hit of 40% and isn’t in a crisis?

Put another way, despite public perceptions, the Big Three were finally getting it right by the time the downturn arrived, but they were saddled with debt when they, their dealers and consumers were all cut off from credit overnight. That was potentially a death knell. MacDuffie thinks of the government action not so much as a bailout of an uncompetitive industry that was behaving badly, but more of an investment in a “super-important” part of the economy already on an “impressive improvement trajectory.”

Noting that the auto industry has “so many multiplier effects, there are so many jobs related to it,” he adds that many also believed it was simply “important for a country to have its own car companies.” Losing so much of the domestic auto industry would have reduced competition and taken away a lot of manufacturing capability.

In summary, the industrial mismanagement you speak of was largely long gone by the time the 2008 financial crisis hit and undertaken by internal investment and management reformation (Ford better than GM and CryCo). GM, Ford and CryCo got caught in a financial crisis not of their doing. Let's not forget Wall Street was bailed out too and the financial crisis was mainly the result of Wall Street's poor financial practices chasing poor Governmental housing market regulations (mis)management by bought-and-sold-for Politicians.

I think there is a good debate to be had regarding the existence of Tesla had not the US Government and foreign Governments created an artificial world EV marketplace. I also consider the benefit of investment tax breaks for energy companies that produce petrochemicals has a far deeper reach into the entire US economy than just EV transportation sector, which makes those tax investments by the Fed better policy.

We could debate whether or not bailing out the auto sector (or Wall Street) was a good idea or not. Funny thing about both was many ‘regular people’ lost everything but the fat cats in the auto sector and Wall Street lost nothing. Two close friends are execs at GM and their bonuses were canceled during the meltdown, only the have them repaid 2 years after the bailout

I will say the one thing I can appreciate GM for is paying for my education…nothing like a summer job on the line as a student in the early 90s making $25/h.

I also wouldn’t necessarily say that GM et all improved, but rather were the beneficiaries of right to work legislation in many cases, reducing their labour costs and the stranglehold of the unions.

[GrussGott]

Originally Posted by Tejas1836

"I still think the pace of BEV transition will be blistering..."
Not without major battery breakthroughs and massive electrical grid upgrades, on the magnitude of ~$6,000 per new EV, which will require breeder reactors.

Right. You know the one thing capitalism is great at? Getting shit built fast!

Here's the thing: in college in the 90s I scored an engineering job that took me to the rural midwest to ... help complete rural electrification & telephone infrastructure! From a gov't program that began in 1930s! Like, that's a long ass time. I have a few gray hairs, but not THAT many.

Should we conclude the 1950s light bulb industry was doomed or General Electric was a failing company due to lack of grid upgrades?

Or how about when air conditioning began mass adoption in the 1970s?

No way that could happen without grid upgrades which are, btw, larger than BEVs need. So that's why we all don't have air conditioning right now, right?

Every utility is chomping at the bit to dump billions into their grid and the only thing holding them back is certainty of adoption & utilization. Once the data is in, capitalism will build infrastructure faster than you can comprehend.

Cozy up to the math here:

[M3WC]

Originally Posted by GrussGott

Every utility is chomping at the bit to dump billions into their grid and the only thing holding them back is certainty of adoption & utilization. Once the data is in, capitalism will build infrastructure faster than you can comprehend.

Tesla will be their to reap the benefits selling megapacks. Tesla has a brand new megafactolry in Lathrop that just finished with ability to produce 10k megapacks next year. Avg price of megapack is about $2mill, possible $20bill/year revenue stream coming online. Selling to a market likely to be unaffected by recession, the world’s utility companies. New IRA subsidies ready to hand out in US as well, with 30% tax credit restored for commercial energy storage installations. Supposedly already sold out through Q3 2024.

[GrussGott]

Originally Posted by M3WC

Tesla will be their to reap the benefits selling megapacks.

Maybe. That's a lot of hope & dreams stuff though.

I mean Siemens' steam turbines will probably get a lot of demand too ... but in that case, those steam turbines are a LOT harder to duplicate than an LFP battery pack, right? That is, what's the big moat with a giant LFP pack?

Further you could forgive people for pointing out that $TSLA is a consumer company, not an industrial, and B2B is a totally & completely different business that sells totally different and ideally requires service & consulting arms, something that $TSLA has historically been terrible at.

And if, say, Siemens already has a foothold & relationships in most major utilities and sources LFP battery packs from China, well, who might the buyer trust more?

Anyway, just pointing out that Speculation Avenue has a lot of subdivisions.

[M3WC]

Tesla reports 1.31 million deliveries in 2022, growth of 40% over last year.


https://www.cnbc.com/2023/01/02/tesl...n-numbers.html

[GrussGott]

Originally Posted by M3WC

Tesla reports 1.31 million deliveries in 2022, growth of 40% over last year.


https://www.cnbc.com/2023/01/02/tesl...n-numbers.html

So that's a clear miss from Zach's Q3 call guidance:

"On the delivery side, we expect to be just under 50% growth due to the increase in car in transit at the end of the year"

And before we claim this isn't a parochial phenomena, we should note BYD has little (or significantly less) of the Q4 Chinese market weakness Tesla does.

From an investor perspective this means $TSLA is priced for explosive growth at 5x earnings, but is instead tracking just good (vs explosive, j-curve type) growth.

So often we hear the Muskateers justify j-curve explosive growth by comparing to legacy auto who are incremental; that's not the way you do it! Either a company is experiencing explosive growth or it isn't; With these latest numbers it is now a fact $TSLA isn't experiencing explosive growth and hasn't been for 6 months. Further, $TSLA growth is slowing.

The 2nd scarier question is why?

One industry-wide answer is because BEVs in total seem to be a luxury product as defined by the segment of customers buying them. In the US for example, the $30k Chevy Bolt is a top 20% of earners vehicle!

If this trend continues, it'll mean no explosive growth for BEVs as the top 20% becomes saturated and customers trade around just like we swap BMWs for Porsche or Mercedes.

In fact, based on Edmunds data, 50% of those trading in Teslas buy an ICE vehicle!

That would mean the only growth segment left for $TSLA would be pickups, i.e., the Cybertruck. Thus if deliveries of the CT fail to hit "explosive growth" I'd expect $TSLA to be conservatively in the $30-$50 range.

The World very well may have seen a 2017-2022 five-year bollus of explosive BEV adoption, which is now quickly slowing as the wealth-effect diminishes and people move to risk-off.

[chad86tsi]

Originally Posted by GrussGott

So that's a clear miss from Zach's Q3 call guidance:

"On the delivery side, we expect to be just under 50% growth due to the increase in car in transit at the end of the year"

From an investor perspective this means $TSLA is priced for explosive growth at 5x earnings, but is instead tracking good growth.

So often we hear the Muskateers justify j-curve explosive growth by comparing to legacy auto who are incremental; that's not the way you do it! Either a company is experiencing explosive growth or it isn't; With these latest numbers it is now a fact $TSLA isn't experiencing explosive growth and hasn't been for 6 months. Further, $TSLA growth is slowing.

The 2nd scarier question is why?

One industry-wide answer is because BEVs in total seem to be a luxury product as defined by the segment of customers buying them. In the US for example, the $30k Chevy Bolt is a top 20% of earners vehicle!

If this trend continues, it'll mean no explosive growth for BEVs as the top 20% becomes saturated and customers trade around just like we swap BMWs for Porsche or Mercedes.

That would mean the only growth segment left for $TSLA would be pickups, i.e., the Cybertruck. Thus is deliveries of the CT fail to hit "explosive growth" I'd expect $TSLA to be conservatively in the $30-$50 range.

For much of the last few years the principal factor modulated their growth was their ability to produce, IE the "supply". Now it seems what is modulating their growth is "demand". That is a very, very different and quite difficult problem to solve. That they have this issue in other markets (china) as well is far more trouble than that sounds.


I hope they make good decisions in the next few quarters, I'd hate to see them not continue.

[GrussGott]

Originally Posted by chad86tsi

Now it seems what is modulating their growth is "demand".

I'd agree if by "demand" you mean "the right product" meaning features + price + services.

Said differently, cars are becoming (IMO, have become) a tech product from a consumer perspective and consumers are starting to expect the same features & speed they get from their phones in their cars; and one could even say they expect more in the sense cars have larger screens and are a great space for a conference call, etc.

Tesla had the right product for 2017 - 2022 for a top 20% market:
* Best buying experience,
* Weekly feature updates,
* Class leading power,
* Best software

and Tesla was able to conquest tech execs buyers first, luxe virtue signalers 2nd, tech bros 3rd, and top 20% practical buyers 4th. This includes China and the EU, but in the EU we'd have to add EU-subsidy arbitrage buyers (i.e., German buyers sell their car in Denmark)

The thing is, these are all top 20% tech friendly buyers so ... are there many more of those?

Given Tesla's massive skill at building factories, they may be getting to demand constraints.

Rivian on the other hand is able to attract a totally different market (suburban lifestyle buyers) but Rivian can't produce so they're still supply constrained.

Ford is DEFINITELY supply constrained, especially with the F-150 Lightning

GM seems to be supply constrained but why aren't they making more supply? The Lyriq is arguably way better than any Tesla, as is the Hummer, but supply is a trickle. Will the Blazer, Silverado, & Sierra also be trickle produced? Is GM holding back / sandbagging production?

Hyundai with their Ioniqs is also supply constrained but also seem to be holding back production.

Lucid is DEFINITELY supply constrained ...

But back to demand, are no-garage single-car buyers demanding EVs? No.

Will they buy them if the right product is produced? GM seems to be getting close that segment so we'll see, but they sure don't seem to be in a hurry.

[Tejas1836]

On the demand side, the PHEV and BEV market will follow the housing market is my prediction

[1BimmerBoy1]

Tesla, no thank you. I don't wanna be caught inside a fire and locked inside my car

[Sophisticated Redneck]

Question: Will the EMF coming from the motors make our swimmers glow? Asking for a friend

In all seriousnessessses, has anyone measured the EMF radiation coming off those bad boys, especially in the rear seat that is just above the motor at freeway speeds/acceleration? All of the videos I have found measure it at the center console or when parked which is worthless. I want to know what a baby/kid is getting exposed to in the back seat on long drives at freeway speeds when the motors are pumping out 25+ killowatts for long periods of time. I will leave the EMF radiation from 500+ killowatts under full throttle for another discussion.

spellz errors are intentional

[chad86tsi]

Originally Posted by GrussGott

I'd agree if by "demand" you mean "the right product" meaning features + price + services.

Said differently, cars are becoming (IMO, have become) a tech product from a consumer perspective and consumers are starting to expect the same features & speed they get from their phones in their cars; and one could even say they expect more in the sense cars have larger screens and are a great space for a conference call, etc.

Tesla had the right product for 2017 - 2022 for a top 20% market:
* Best buying experience,
* Weekly feature updates,
* Class leading power,
* Best software

and Tesla was able to conquest tech execs buyers first, luxe virtue signalers 2nd, tech bros 3rd, and top 20% practical buyers 4th. This includes China and the EU, but in the EU we'd have to add EU-subsidy arbitrage buyers (i.e., German buyers sell their car in Denmark)

The thing is, these are all top 20% tech friendly buyers so ... are there many more of those?

Given Tesla's massive skill at building factories, they may be getting to demand constraints.

Rivian on the other hand is able to attract a totally different market (suburban lifestyle buyers) but Rivian can't produce so they're still supply constrained.

Ford is DEFINITELY supply constrained, especially with the F-150 Lightning

GM seems to be supply constrained but why aren't they making more supply? The Lyriq is arguably way better than any Tesla, as is the Hummer, but supply is a trickle. Will the Blazer, Silverado, & Sierra also be trickle produced? Is GM holding back / sandbagging production?

Hyundai with their Ioniqs is also supply constrained but also seem to be holding back production.

Lucid is DEFINITELY supply constrained ...

But back to demand, are no-garage single-car buyers demanding EVs? No.

Will they buy them if the right product is produced? GM seems to be getting close that segment so we'll see, but they sure don't seem to be in a hurry.

Yes, they have saturated the Niche they occupied, and don't seem to have a plan to diversify out of that. They are intentionally priced out of the down-market segment that they could easily occupy. They clearly have excess capacity. If they don't pivot soon, there will be little chance to lead that segment, it's already getting pretty full of good competition.

Tesla Inc. shares fell more than 10% after the electric carmaker delivered fewer vehicles than expected last quarter despite offering hefty incentives in its biggest markets.

https://www.bloomberg.com/news/artic...fourth-quarter

Market Summary
Tesla Inc
108.93 USD
−14.25 (-11.57%)today
-290.85 (-72.73%)past year


From the same article above :
Tesla's Production Outpaces Deliveries
The company made 34,423 more vehicles than it sold last quarter

Their production has exceeded sales 3 quarters in a row.

[M3WC]

Originally Posted by GrussGott

and Tesla was able to conquest tech execs buyers first, luxe virtue signalers 2nd, tech bros 3rd, and top 20% practical buyers 4th. This includes China and the EU, but in the EU we'd have to add EU-subsidy arbitrage buyers (i.e., German buyers sell their car in Denmark)

As of November, Model Y is now the number 1 selling vehicle in all of EU. Once Tesla adds standard range Model Y to GigaTexas, I see that being a big seller in North America in 2023 with new credits.

Originally Posted by GrussGott

GM seems to be supply constrained but why aren't they making more supply? The Lyriq is arguably way better than any Tesla, as is the Hummer, but supply is a trickle. Will the Blazer, Silverado, & Sierra also be trickle produced? Is GM holding back / sandbagging production?

Yes the Silverado will be a trickle product. Also entry cost will not be $40k. After seeing the 3WT/4WT trim level prices, I don't expect to convert my early reservation to an actual sale. GM thinking they can sell work truck trims at Rivian luxury pickup prices...good luck. No GM are not "holding back" production. Mary simply made production goals and can not meet them. Battery production scaling has proven to be more difficult than they thought. Also more costly. They will miss production goals on Blazer and Equinox EV as well. Hyundai stock is a much better play near term, their E-GMP platform is class leading and they are pumping out models much higher rate than GM(although I think auto sector is in for an equally bad 2023...or worse). Hyundai(SK) recently won a lobbying battle against GM/Ford, Treasury released guidance for new EV tax credits(IRS sec45). Allowing Hyundai and other non-US built EVs to get $7500 credit through leasing.

[G35POPPEDMYCHERRY]

where them TSLA boys at now. lolol. Gotta love watch fools ride the wave of the stock market.

finally TSLA getting flack and not being inflated by hopes and dreams.

[GrussGott]

Originally Posted by M3WC

As of November, Model Y is now the number 1 selling vehicle in all of EU.

But to whom and why?

I just spent 6 weeks driving around Germany and I can tell you, unless you see Teslas on trucks, they're almost non-existent.

So what's the deal with all those German sales? Well, they were buying them and then selling them in other EU countries to get the subsidy. Said differently, nobody actually wanted the Tesla, they just wanted to flip it for the gov't subsidy $$$.

But, again, who are they flipping them to?? Top 20% income buyers! That makes Tesla look a LOT like Mercedes or BMW, companies able to hit sales of 2M/year in, say, the US but not able to get larger. That is, luxury products are customer segment limited.

In this case, there are only so many people who want to buy a crossover, that also a full BEV, that's also a Tesla.

This is also why Ferrari is making an SUV: they can't get any appreciable sales/revenue growth from new customer segments so they can only grow by expanding product segments and selling to the same customer.

A non-luxury product strategy says "sell 1 to every house on the block".

A luxury product strategy says "sell 3 to a few houses on the block"

You're presuming "best selling" implies everyone is buying one, but the data shows only multi-vehicle multi-garage top 20% buyers are buying them and that's terrifying the auto industry!

It's why there's the big industry rumor that $GM is sandbagging Lyriq production; they're making plenty of money on ICE, they're rolling out plenty of BEV models, so why rush BEV production? Pull the Rolex trick and produce
way under demand and see what happens. The ole scarcity trick.

Might work.

Because look at $TSLA!

They missed growth by 10% from guidance provided just last quarter!

Either Tesla is hitting an unexpected demand wall (ie., the luxury product demand wall), or their forecasting is complete shit, or Zach was forced to guide to a forecast he didn't believe in.

Which of those possibilities is the good one?