Today's Earnings Call - Model 3 news?

Today's Earnings Call - Model 3 news?

It's at 2:30PT, 5:30ET. Hopeful for some model 3 news. Perhaps confirmation of pilot production. I'll miss it so will have to listen to the replay, which is usually posted 2 hours after the event. If anything good is said, please post it here. I can sneak peeks at my phone now and then. :)

Haggy | 2017年2月22日

Suppliers were told to deliver parts to make 1000 cars per week in July, 2000 per week in August, and 4000 per week in September. That would mean that Tesla is shooting to be up to a 200,000/year rate by September.

Orders will start in "3-4 months." Final reveal will be closer to production, which won't be a problem since the first cars go to employees so Tesla can get valuable feedback.

Elon was asked if the car will be like the one shown at the last reveal. He said it will be mostly like that...except better...and in some areas, much can say it will be much better. That's paraphrasing. I don't remember the exact quote or how many awkward pauses there were.

He mentioned that drive train life expectancy has gone from 250,000 miles to 1 million. He didn't explicitly say if that's for current vehicles or just for the new ones going on the Model 3.

A lot of the rest was financial, but he did say that the cost to go from 5000 per week to 10,000 per week will be about half of what it took to go to 5000/week. So ramp up plans seem ambitious.

He was asked about suppliers and production delays. He said that with the Model S, Tesla had its own numbers and showed them to suppliers, but suppliers didn't believe them. Suppliers went by industry estimates that Tesla would not sell more than 3000 cars over the life of the vehicle, so they weren't anxious to make parts at all. This time around, Tesla has contracts with the top suppliers with their top teams working on it.

Tesla still won't give updated figures for the number of orders but said everything is in good shape. However, disclosing the numbers wouldn't be good for business. That could mean that cancellations were marginal and won't hurt things, or that the number of incoming orders in the future will make it a moot point, or quite possibly that the numbers are growing so fast that Tesla fears if people know how many orders there are, they would cancel out of fear it would take too long. I'd rather not say what I read into it because it would be off topic.

He was asked about Trump and tax credits, and he said the subject came up, but they didn't speak in depth. Elon said that he mentioned the possibility of tax credits going away and that he's fine with it, but if they do go away on the grounds that there shouldn't be government involvement, the same should apply to the oil industry. Getting rid of oil industry subsidies would be a complicated endeavor so if Trump announces a plan to get rid of both, I wouldn't expect to see anything anytime soon. If the tax credits did go away, the cost of gasoline would still make it worthwhile to get a Tesla. Elon did mention that it would be good for Tesla if all these credits went away because it would be harder for GM to sell the Bolt and for other companies to get EVs off the ground. But I think Elon was talking more from a financial point of view in terms of how it would affect the company rather than saying he'd want them to go away.

KP in NPT | 2017年2月22日

Haggy I knew I could count on you to have the patience to write out a full recap. ;-)

I just finished listening to the call - had been out to dinner with family while on an out of town work thing. Bummer about the later than expected unveiling. :( But glad it seems to be on track, as far as its in their control. He was a little confusing though - first said closer to July, then said configuration in 3-4 months. I don't think he can expect people to configure without seeing it - so I'm wondering he is being coy.

Efontana | 2017年2月23日

Stuff I think I heard between the lines:
1) Demand for the car is great - no need for demand generation events.
2) Parts costs are ridiculous if not from a production tool/pricing arrangement - all the parts need to be right.
3) Positive cash flow and demand seemed juxtaposed in one sentence toward the end of the call.

Underlying concern: A lot of the people with deposits, demand, is at the lower end of the price range.
Tesla needs to focus on costs, costs, costs to convert these orders into customers.
A massive employee testing program is the answer to avoid item 2, and also smear the subsidy over the largest number of depositors/fans thereby addressing the underlying concern.

I would run the first 10,000 with employees for 3 months to make sure item 2 is resolved.

That is a different parts delivery schedule than reported elsewhere.

jordanrichard | 2017年2月23日

Just one clarification about the life span of the DU life expectancy. That wasn't specific to the Model 3. It was in the context of Tesla lowering it's costs of warranty work. Saying that the DU were originally designed to last 250,000 miles but due to improvements in design, they have " aspirational expectancy of 1,000,000 miles, which reduce our warranty costs". I suspect that the improvement, was switching to ceramic bearings. For anyone that has had their DU replaced in recent times, will have received the update DU design.

Haggy | 2017年2月23日

That's what I inferred but since Musk wasn't explicit, I didn't want to be either.

By the way, my goal wasn't to be comprehensive. I assumed somebody else would have done much of this. Otherwise I would have taken notes. Also there was a lot more said that wasn't Model 3 specific.

Another interesting point that has come up in this forum before is how long Musk plans to stay on at Tesla. He said he plans to stay on forever, unless they kick him out.

akgolf | 2017年2月23日

More than happy if Elon stays with Tesla for the long haul.

dd.micsol | 2017年2月23日

bought 10k shrs for myself today. Good discount.

bj | 2017年2月23日

A lazy coupla million lying around.