The reports below summarize the TSLA Q1 results and conference call:
Looking at the numbers, as TSLA has mastered only the easy part
of building cars, huge losses continue:
http://autoweek.com/article/green-cars/ ... al-profits
Tesla has to turn potential into real profits
YIKES! TESLA'S PER-VEHICLE PROFIT IS NEGATIVE $15,855
General Motors earned an operating profit of $1,418 for every vehicle it sold around the world in the first quarter. Ford Motor Co. earned a little less: $1,174.
Tesla, by the same calculation, is in a whole different league, and not in a good way. Its per-vehicle profit comes in at minus-$15,855.
For every car Tesla sold, it lost more than a year’s pay at a minimum-wage job...
Yes, that’s an eye-popping figure, and one that’s not sustainable for a company that wants to be in business for very long.
But no, that’s not, on its own, a fair assessment of Tesla, an automaker that’s essentially still in its infancy.
Still, they’re numbers worth looking at and writing about here. Because they do show an inescapable truth about the auto industry: It’s easy to lose huge amounts of money building and selling cars, but it’s hard to eke out profit margins that would be laughed at in most other industries...
Will the next TSLA product reverse these losses?
Hard to see how TSLA will make significant profits soon by entering the commodity market segment
that produces the lowest (or negative) margins for its competitors with the model 3 sedan, and by suggesting the new model Y platform is still years away from production:
https://www.bloomberg.com/view/articles ... ssover-hit
Tesla Desperately Needs a Crossover Hit
...Under Musk's leadership, Tesla has produced a series of undeniably desirable vehicles that helped it briefly become, on paper anyway, the most valuable automaker in the nation. But is has rolled these cars out in a frantic, iterative, inefficient and nonstrategic manner that shows why mainstream automakers tend to be run by "bean counters" rather than creative visionaries.
Nothing illustrates this dynamic quite like Tesla's crossovers, the Model X and the forthcoming Model Y. Crossovers are unsexy but highly pragmatic machines that are critical to profitability in the modern car business. With Musk revealing that the Model Y will not share a platform with the mass-market Model 3 sedan, as most analysts had expected, it's becoming clear that the firm still hasn't appreciated basic logic of the crossover market. As Tesla moves into the lower-margin mass market and comes under increasing pressure to show profitability, this unexciting but important lesson will have to be learned.
Decades of tough competition have eroded profit margins on sedans, turning the bulk of the car business's production volume into a commodity product. The industry's answer has been to build roomier, more capable crossovers using the platforms, drive-trains and other internal gubbins from their sedans, thus spreading the development costs of these shared components over more volume and improving margins. ...
Musk's most recent comments about the next-generation Model Y suggest that the company still has not learned the critical crossover lesson. Rather than making a small investment in a new, more spacious crossover body for the Model 3 and charging customers more for it, Musk confirmed that Tesla is developing an entirely new platform for the Model Y.
This means that instead of spreading the Model 3's fixed development costs across more, higher-margin vehicles, Tesla will sink tens (if not hundreds) of millions of dollars into a bespoke platform for its second crossover. For a small-scale automaker, lacking the efficiencies of scale enjoyed by its established manufacturers, Tesla's decision to develop four platforms for its first five vehicles is all but incomprehensible...
Maybe you just have to be on the right
drugs to understand TSLA's business plan...
http://www.cnbc.com/2017/05/04/cramer-y ... iness.html
You have to be on drugs to get Tesla's business
After Tesla's stock sank over $15 on Thursday following its earnings report, Jim Cramer looked into the company to try and understand its high-flown forecasts.
"If you're an analyst, I think the only way to handle an Elon Musk conference call is to take some mind altering drugs so you can really tune in and turn on the whole psychedelic story," the "Mad Money" host said of Tesla's CEO.
While Cramer admires Musk's confidence, he sympathized with those who try to make mathematical sense of his ultra-positive musings.
Watch the full segment here...