Seeking Alpha

Model S sales level off

  • Tesla Motors (TSLA +2.7%) sold about 1.6K Model S vehicles in the U.S. during March to show just a slight increase over the sales tally for February, according to AutoData Corp.
  • Barclays is out with a note to clients indicating it believes demand in the U.S. has plateaued. Q1 Y/Y unit sales growth of just 1% from Tesla backs up Barclays' claim.
  • The EV automaker is looking to the Model X introduction to be the main driver for mass market sales.
Comments (79)
  • Tri Duong
    , contributor
    Comments (1454) | Send Message
     
    Unless you show me that supply finally caught up or exceed demand, saying that sales leveled off in the US is worthless. Tesla is clearly pushing more Model S overseas because their customers over there are waiting much longer than US buyers.

     

    Regardless, TSLA is still overvalued. In its current position.
    8 Apr, 02:31 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    And this is why Norway, that key strategic market, gets 25% of all production?? Obviously sales are flattening in the US and are not gaining any meaningful traction in large European markets (yet anyway).
    8 Apr, 02:44 PM Reply Like
  • Tri Duong
    , contributor
    Comments (1454) | Send Message
     
    I would agree with you but the only thing that limit sales so far is their production capacity. We don't know the numbers. It's even harder to guess when Tesla reduced the reserve requirements. All we know is demand>supply still being true.

     

    There's also the fact that dealers are stepping up pushing lawmakers to go against Tesla. It's a dirty game right now and Tesla won't gain any grounds in the US until it put down the factory. I'm not sure i agree with tacking on the value of the battery factory to share price when there's no solid plans in place yet. We're not even sure about which state or whether or not laws will affect Tesla.

     

    I love Tesla but this stock is looking like a trader's game based on news. One false move on the "gigafactory" and you'll see the stock drop $30-50 in one day.
    8 Apr, 02:54 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    "I would agree with you but the only thing that limit sales so far is their production capacity"

     

    No - or you wouldn't "allocate" all those cars to Norway. It is a non-factor market in the long run. Tesla is not capacity constrained, rather they are carefully ramping production to create that perception. You do not expand into multiple markets in rapid succession if you are truly constrained by capacity.
    8 Apr, 03:04 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    David RG, you are merely speculating. Matter of fact, in the past year any number of Tesla critics have claimed that it would be impossible for them to scale rapidly and that even hitting the production numbers they did hit would be nearly impossible. And now you come and say that hitting those production numbers are so easy that they are just creating a perception of production constraints. Funny.

     

    Tesla is laying the groundwork to become a much bigger company. You might not expand to multiple markets in rapid succession, but that doesn't mean that Tesla shouldn't.
    8 Apr, 03:13 PM Reply Like
  • Ivan Gault
    , contributor
    Comments (19) | Send Message
     
    Exactly!
    8 Apr, 03:20 PM Reply Like
  • Johnny04
    , contributor
    Comments (86) | Send Message
     
    "You do not expand into multiple markets in rapid succession if you are truly constrained by capacity."

     

    That would depend on your goal. If you just want to sell what you have, then focus in a small market that meets your supply. If you want the global name recognition to the point that your used product is worth as much as your new one so that you would have 500k+ demand globally in three years for your new product, then you would expand to multiple markets now when you have 25%+ profit margin and when various markets still offer great incentives to your customers.
    8 Apr, 03:48 PM Reply Like
  • joeinslw@gmail.com
    , contributor
    Comments (575) | Send Message
     
    TSLA is still overvalued. In its current position. Yeah, and watch i get more overvalued, it was more overvalued today, and more tomorrow, until ya'll say it must have value, people are buying more and more of them.
    8 Apr, 03:51 PM Reply Like
  • Locked Down Investments
    , contributor
    Comments (1322) | Send Message
     
    There are boatloads of cars on their way to China right now. Also Tesla may be trying to figure out how to incorporate RHD vehicle production for UK, Japan, Australia, etc into their one production line without slowing everything down.
    I imagine they must be experimenting with this now if they are to meet deadlines promised for the RHD markets (we were promised delivery by early 2H 2014).
    8 Apr, 04:16 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    Norway is not a place you expand to in order to achieve Global or even European name recognition. And you certainly wouldn't allow a non strategic market like Norway to prevent you from opening up new, critical ones like Germany.

     

    It is, however, a key market if you are having real difficulty achieving revenue growth in other markets such as the US. With the preferential tax treatment EVs get in Norway, it is the one market with solid demand.

     

    So Norway is soaking up soft demand in other markets, including the US which peaked last year.
    8 Apr, 04:18 PM Reply Like
  • Locked Down Investments
    , contributor
    Comments (1322) | Send Message
     
    When I start seeing Tesla advertising on TV and magazines I might then worry that their might be a slight demand issue. Until then...no way.
    Tesla can see exactly how reservations are going and the pace they are growing/declining.
    If they were worried at all they would start an advertising campaign right away. I mean its not like they don't have a lot to crow about:

     

    1. Safest vehicle ever produced
    2. Best acceleration $ for $ (beats more expensive BMW M5 0-100mph)
    3. Most cargo space in its class
    4. Free fuel (supercharging network)
    5. 1/6th the cost to operate and maintain over similar performing vehicles.
    6. Reduces a nations reliance on foreign oil in exchange for domestic electricity and domestic jobs.
    7. Can be powered by 100% renewable energy.
    8. By buying a Model S/X you are funding development of a mass market vehicle (can Porsche or Ferrari say this?)

     

    I could go on but I think that would be a pretty long ad already. Don't want to blow too many minds out there.
    8 Apr, 04:21 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    They can't afford TV media buys. Do you know what kind of spend it takes to create brand awareness?

     

    Ford, Chevrolet, and Toyota spend about $1 billion per year +\-. And that is at the brand level, not including local dealer ads that actually are about "selling". Brand ads are just designed to create awareness and get the brand into your consideration set.

     

    By the way, Apple and Samsung about $600 million. Small brands like Jaguar "only" spend $150 million.

     

    Tesla is smart in not advertising (yet), because they cannot afford the table stakes. But it is not because they don't need it. That's a cute story, but unaided awareness of the Tesla brand would be below 1% today.

     

    If Tesla ever wants to sell more than 500,000 cars they will need to do it eventually. Automobiles are one of the most brand driven categories.

     

    http://read.bi/R1kaK0
    8 Apr, 04:38 PM Reply Like
  • Locked Down Investments
    , contributor
    Comments (1322) | Send Message
     
    Sorry David. Bottom line is that Tesla would start advertising in their most effective channels right now if they saw a worrying reduction in reservations.
    No duh they wouldn't spend a billion on ads right away. To each his own. Tesla is about 1/3 the size of Porsche right now...so I imagine their ad spend might be 1/3 that of Porsche if they thought ads were necessary.
    They don't..so there are no ads.
    Period.

     

    oh wait sorry there are some Tesla ads out there:

     

    http://bit.ly/12EXWQJ

     

    http://bit.ly/R1quBw

     

    http://bit.ly/R1quRL

     

    http://bit.ly/Q10ntg

     

    Except these have been made by Tesla owners/fans

     

    How many other cars out there have their fans actively trying to sell them on behalf of the company???
    How many?
    8 Apr, 05:36 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    You missed my point. The minimum spend is $100 million. Advertising media is not scalable according to size of the business. You either commit to big $'s or don't do it at all.
    8 Apr, 05:40 PM Reply Like
  • Locked Down Investments
    , contributor
    Comments (1322) | Send Message
     
    Oh really? I advertise my business and certainly don't spend $100 million.
    Point is Tesla could easily be advertising in many areas if it felt it needed to.
    The fact that they still don't advertise AT ALL should be a big warning to the bears on TSLA.
    13 Apr, 10:44 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    Wait..Jaguar spends 150 M on sales and had 17000 sales in the US last year of Jaguars.

     

    Well, the Tesla Model S is a comparably priced car and spent 0 on ads and had about same amount of sales in the US (we really don't know the true demand because of the production constraint issue) .

     

    If you have two cars similarly priced, with similar sales. Please explain how advertising helps and boosts sales when both sell roughly the same amount and one advertises and one does not.
    14 Apr, 06:27 AM Reply Like
  • PatPatterson
    , contributor
    Comments (34) | Send Message
     
    How accurate has the AutoData been in the past?
    8 Apr, 02:35 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    Let me put it this way. Those that put too much faith in AutoData's estimates last year and thought that Tesla's numbers were going to be low were unpleasantly surprised when Tesla announced actual numbers. You would think they would learn.
    8 Apr, 03:18 PM Reply Like
  • PeterJA
    , contributor
    Comments (2091) | Send Message
     
    "How accurate has the AutoData been in the past?"

     

    Last summer, Autodata claimed that Tesla sold 4181 cars in Q2 2013.
    http://bit.ly/R1do7d

     

    Tesla actually sold 5150 cars.
    http://bit.ly/JQy6Cy
    8 Apr, 03:27 PM Reply Like
  • Frank Greenhalgh
    , contributor
    Comments (1268) | Send Message
     
    Without advertising its hard to sell cars. If it wasn't would Detroit spend as much as they do?
    The S sales for 2013 included wealthy early adaptors, who weren't worried about saving on gas, but wanted the EV experience and recognition as being green. Now that they have bought their cars, new sales will only come from word of mouth and Tesla's constant news items.
    It will be interesting.
    8 Apr, 02:36 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    Not exactly true;
    There are 2 philosophies when it comes to advertising.

     

    Keeping up with the Jones'-e.i someone has something amd you want to purchase it because they rave about the product, like it, etc, etc.

     

    Or TV ads
    Well, they may work, but most of the time they are casting a net to no avail. Problem is people are smart, there are only a handful whom think bright lights, glitter and a nice voice make people buy something. Maybe kids and candy, but honestly, the commercials on TV have not impelled me to buy one thing (except maybe comic books back when I was a kid). Kids don't buy cars, grown adults don't care which english supervillian drives a Jag. Adults don't care about zombie readiness cars, nor dancing hamsters, nor sending a horse to a stud ranch.

     

    If I want a zombie survival car- a hyundia would not be a choice; it would be a Hummer or a Tesla (silent, solar cell charging and a portable lotus charger). See the point, people hyundia doing that and think "crap, I'd get a hummer". Not that i've even entertained the thought- ridiculous premise.
    8 Apr, 06:45 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    "Well, they may work, but most of the time they are casting a net to no avail"

     

    You are foolish if you really think TV advertising doesn't work. And I'll go further - it works on you even if you don't realize it. That's why companies keep spending $350 billion a year on it. And they measure the effect with advanced metrics. It's not a guess.
    8 Apr, 10:01 PM Reply Like
  • John Bingham
    , contributor
    Comments (805) | Send Message
     
    David,

     

    You're living in the past! I bought my first DVD/HDD recorder more than a decade ago and I've not been plagued by ads since then. Just set to record a program, edit out the ads later (a very quick job) and watch when you want without any annoying interruptions.

     

    If I need information on new products or technology, or even the best pricing for a product, I'll look online. I choose what I look for and I don't rely on the advertisers to "guide" my buying decisions.

     

    Tesla may never need to advertise. The best products sell themselves.
    9 Apr, 04:05 AM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    John

     

    The $350 billion spent is current data. I can also personally guarantee you that firms run marketing mix analsysis (regression models), brand health tracker research (measuring awareness among other things), and a host of other research constantly in order to measure the effectiveness of their media spends. They DON'T guess. Ever.

     

    So while digital media is growing much faster, the most impactful and usually cost effective media spend is television. Hence the continued spending!
    9 Apr, 06:54 AM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    David,
    How many cars have you considered purchasing based on a TV ad?

     

    Myself, none, everyone I know, none.

     

    Tesla is a great example as is Ferrari. Neither advertise, but sell cars.

     

    Tesla sells more cars than GM sells corvettes last year. Again, GM advertises, Tesla does not. I would say it doesn't really work.

     

    When ads come on the TV, well, it's like 2 minutes.. time for a bathroom break, time to grab something to eat, time to clean up, etc, etc

     

    Guess when I developed that behavior- like 25 years ago.

     

    Gen X/Gen Y/Millennial really don't watch commercials any more.

     

    You really think dancing hamsters, bond villians, zombies, and talking robots are going to make someone buy a car?
    If they buy a car because they think dancing hamsters are cute or think it'll make a great zombie survival car- well, those people have much bigger issues (namely getting out of the straight jackets they are wearing).

     

    Advertising does work for food products and small lower cost items- kids show and candy, spongebob- mcdonalds. gum, entertainment products, but not for items which are tens of thousands of dollars. Impulse items- even then your rational part may take over.

     

    Everyone knows Ford, GM, and Fiat sell cars. in the market, edmunds or other car site tells you all you need to know, 3-5 years I'll get a car; maybe months from now, but I want to compare. Mcdonalds- McRib is back... it's back.. I eat food every day... maybe I should get one.

     

    When you have to enter hundreds of dollars of monthly payments for years... your rational part of your brain takes over- do I really need this car vs my old one?
    10 Apr, 05:55 PM Reply Like
  • David RG
    , contributor
    Comments (1024) | Send Message
     
    Dan,

     

    It works. That's why companies spend all that money. I'll say again - they don't just "hope" or "guess". They measure and know. Most consumers say they are unaffected by advertising, but the data shows that is not true.

     

    Automobiles is one of the largest categories of advertising and for good reason. We as human beings like to think we are rational but the main driver of purchase interest (overall) is seeing a car on the road you 'like' and can see yourself driving. The second is advertising. And then we go an research the car to come up with all the rational reasons why it is a smart purchase.

     

    But that decision was made long before we got down to research.
    10 Apr, 06:05 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    David
    I'll cite Ferrari and Tesla.
    They don't advertise, they don't spend money advertising.

     

    Two companies that don't advertise

     

    Tesla sells a 70-100 K car and it is outselling its competition in that price range whom do advertise.

     

    Please explain how a car company that does not advertise is selling more than a car company that is advertising.

     

    Also please explain how Ferrari, whom also does not advertise sells a decent amount of cars.

     

    Show me data that says it affected it.
    Let us look at US Jag sales
    Feb 2nd the "bond villain" Superbowl commercial aired

     

    Let us look at the numbers Feb 2nd the Superbowl ad
    Now let us look back May 2013 had a big jump as did subsequent months vs previous years. Remember US is a big Superbowl watcher.
    Predicting and extrapolating from May 2013 to Jan 2014; Without the superbowl commercial, Jag should have sold 1641 cars in Feb. With the superbowl ad; they sold 1552. 90 LESS than predicted based on previous sales increases. Something ain't right.

     

    Explain why, despite spending millions on an ad, that the sales did not increase to the level predicted. Also explain why the sales did not "jump" drastically more than they were predicted.

     

    Now let us look at Ford Fusion Hybrid sales and the superbowl commercial.

     

    Sales are actually down compared to the first 3 months of last year. Spend a few Million, and got 77,000 sales in 2014 vs 80,000 sales in 2013. Me, I would have spend that money on superchargers.

     

    How about the 2013 Rav4 commercial; Feb sales a few hundred more, that is noise though. Then look to see if any trends can be determined. It's statistic noise.

     

    Honda - Hugfest commerical (bruce willis one)
    2014 accord sales down vs 2013
    2014 Civic sales stable vs 2013
    2014 CR-Z sales down vs 2013
    Fit sales down
    Pilot sales down

     

    I would say the data suggests otherwise. I just gave a whole bunch of examples of either cars sales being down or stagnant despite massively expensive ads and no bump up in sales for the money.
    11 Apr, 06:39 PM Reply Like
  • Ford Prefect 1969
    , contributor
    Comments (2282) | Send Message
     
    @fgrindle

     

    "Without advertising its hard to sell cars. If it wasn't would Detroit spend as much as they do?"

     

    Detroit have fallen into the trap of competing with each other on ad spend instead of investing in innovating the quality of their product and service. The only winners: The advertising and media industries. Certainly not the consumer or the vehicle manufacturers. It's a trap because it is really hard for GM for example to divert its ad spend into better products and the same goes for Ford. I actually think it might serve either of them better to offer a better value for money product to customers instead of wasting $Billions on advertising but the management courage to do that is unlikely to surface.

     

    The ICE market is basically stagnant when it comes to innovation with more or less all ICE vehicles having their direct equivalent available from another manufacturer. In the mass market vehicles are for all practical purposes indistinguishable and so is the dealer service offering.

     

    Tesla is not dependent on advertising because its product and service is genuinely without equal in the market. IMO the Supercharger network is all the marketing Tesla requires.
    14 Apr, 05:20 AM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    Wow. This is certainly a surprise. I had just assumed that the soft sales in January and February were just caused by the company being very back end loaded, because of the upcoming Don't call it a Recall. When I saw the titanium spinning plate trick, I figured the company had held up shipping earlier in the quarter before they got the plates ready.

     

    Now we see that this is not the case. It was soft because it was soft. Thus all those pull ins we saw, were really truly pull ins to make it possible to make the quarter, in the first announcement after the big financing.

     

    This means q-2 is very likely to be soft.
    8 Apr, 02:38 PM Reply Like
  • Ad van der Meer
    , contributor
    Comments (101) | Send Message
     
    Just another attempt to make a headline without any substance. All you "know" is how many cars were delivered.
    Model X is a large cross over priced even a little bit higher than Model S. Even more proof you're clueless.
    I can't imagine writing for SA pays well, but this a hack job I could do and most likely even better.
    8 Apr, 02:40 PM Reply Like
  • Tri Duong
    , contributor
    Comments (1454) | Send Message
     
    this is not an actual article. It's like a tweet of news. They're not saying anything besides "hey, this just came in"
    8 Apr, 02:42 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    So 1.6 K cars per month in the US is 19.2 K cars per year for Model S demand.

     

    That is pretty high demand for a car in the 70-100 K price range.

     

    Consider the Corvette, the Model S has more US demand than the Corvette.

     

    Perhaps the Panamera would be a better comparison
    Well, same priced car sold 7614 in 2012 in the US and a grand total of 27331 total.

     

    Heck, norway amd US Tesla sales probably surpass Total worldwide panamera sales.
    8 Apr, 02:41 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    @Dan Fichana
    Overall Corvette sales ...

     

    Oct 2013 - 3,929
    Nov 2013 - 2,527
    Dec 2013 - 3,005
    Jan 2014 - 2,261
    Feb 2014 - 2,438
    Mar 2014 - 3,480
    8 Apr, 10:14 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    @Ad van der Meer

     

    Hopefully you don't believe Tesla's price points. Tesla cars end up costing much more than first publicized.
    8 Apr, 02:44 PM Reply Like
  • surferbroadband
    , contributor
    Comments (953) | Send Message
     
    Oh, I'm sorry, the question is already answered. AutoData Inc. is an industry group that is funded by GM, Ford, Fiat ( Formerly Chrysler ), Toyota and all the other major auto manufacturers.

     

    So this is pure FUD, being funded by the other auto companies.
    8 Apr, 02:45 PM Reply Like
  • rennatus
    , contributor
    Comments (34) | Send Message
     
    Just like CNN talking about unemployment.......
    8 Apr, 05:41 PM Reply Like
  • Frank Greenhalgh
    , contributor
    Comments (1268) | Send Message
     
    Why can't the bulls accept the fact that 1600 cars a month is acceptable for a $100K car. Instead they think the books are cooked. Especially without advertising. The reality will prove itself when there are no sales in China, very few in Germany and a modest (600) amount for Norway these next months.
    8 Apr, 02:51 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (3238) | Send Message
     
    I don't know why you insist on talking trash when you know good and well you don't have the numbers to back you up and when the quarterly results come in they're going to prove you wrong.
    8 Apr, 02:58 PM Reply Like
  • CoverDrive
    , contributor
    Comments (77) | Send Message
     
    Actually, 1600/mo is no where near enough to cover expenses. At their current expense rate, they need about 3000/mo (worldwide) to break even on manufacturing operations. And expenses are going up dramatically. They are looking to fill over 1100 jobs right now.
    8 Apr, 05:03 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    These sales numbers are great news for the shorts. Go TESLA!

     

    Lets see now .... slowing sales while adding more overhead all over the place with Tesla showrooms, service centres, fueling stations ... more employees. $1.14Billion dollars in losses so far and now $3B in debt??? Ouch!

     

    Say it aint so!
    8 Apr, 02:55 PM Reply Like
  • Frank Greenhalgh
    , contributor
    Comments (1268) | Send Message
     
    I have a question for S owners. I heard that tires only last about 15,000 miles due to the cars weight and the regenerative braking. Has anyone put high mileage on their S cars and experienced this?
    8 Apr, 02:59 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    Michelin Pilot Sport PS2's are the OEM tire for 21" wheels and they have the normal tread life of sports car tires. You can check on Corvette or other sports car forums. Some people have low tread life with this particular tire.

     

    The other tires, like the Eagle RSA's and the Continentals and the Michelin MXV4 Primacy's have completely different tread life characteristics as one would expect. The tread life is normal. Tesla is not much different than other cars of its class in this way, other than tire wear from deceleration is likely less due to the use of regenerative braking.
    8 Apr, 03:10 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    I have the 21 inch rims with the OEM tires, with 12,000 miles they are holding up nicely. Maybe get 30,000-50,000 miles out of them.
    8 Apr, 03:18 PM Reply Like
  • winfield100
    , contributor
    Comments (709) | Send Message
     
    @Dan. how many TV programs have you seen Tesla's in. so far, me only 2. Leverage, season 1, episode 2, end of episode and I THINK "almost human" where they killed off several folks (one of last episodes)(don't watch too much tv)
    8 Apr, 04:46 PM Reply Like
  • bwmaki
    , contributor
    Comments (369) | Send Message
     
    Tesla's eat the larger diameter tires because they made a newby mistake of building a fixed (non-adjustable) camber rear suspension set at a performance optimizing negative camber. Other high-end car manufacturers do this but have adjustable rear camber so owners can reset the camber to optimize tire wear at slight loss of maximum sports car handling (or to maximize handling to accommodate different performance tires).

     

    The Tesla blog has some gearheads who have attempted physical modification of the rear suspension to reduce camber but with a lot of worry about voiding their warranties. I imagine Tesla will redesign the rear suspension at some point to correct the oversight.
    8 Apr, 04:55 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    winfield
    I've seen 2,
    Almost human and house of lies

     

    heard it was on the bachelor , but don't watch it so could not verify it.
    8 Apr, 05:40 PM Reply Like
  • Stephen Pace
    , contributor
    Comments (409) | Send Message
     
    @fgrindle: I have the 19 inch rims with the OEM tires, and with 12,000 miles they show very little wear. Two factors in my favor: I have a non-performance car and I had an alignment done very early. Certainly some P85 owners are burning through tires faster than they would like. Some of that is frequent 4s 0-60s (fun but hard on tires), some of that is standard for those types of performance tires, but some of that may be alignment related. Whenever an owner complains about tire life, I always tell them to have the alignment checked. They may be surprised. I have also heard that Tesla has been making some changes to the camber for the rear tires on the P85 that may help.
    8 Apr, 05:54 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    What about the weight of the Model S which weighs 4700 lbs? This extra weight might have an effect on tire wear?

     

    A Corvette weighs 3300 lbs

     

    A Lexus ISF luxury sedan weighs 3780 lbs
    11 Apr, 10:22 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1795) | Send Message
     
    12,000 miles
    21 inch rims

     

    No significant wear, should get 30,000-50,000 miles out of them

     

    very reasonable considering they are "rubber bands"

     

    I had a little 2002 Ford sporty looking car with 17 inch tires, tires only lasted 25,000 miles for the tires, 170 hp, 3000 lb car.
    11 Apr, 11:35 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    You all here should already know enough data to understand that the LA Times' premise is ridiculous. Its one thing when the European delivery numbers weren't known. Now that we know most of that number, you can easily calculate the results which means the idea that U.S. sales are soft is an incredibly specious argument.

     

    Tesla can only make roughly 600-700 cars a week with roughly 11 production weeks, with a guidance of 7,400 vehicle produced in Q1. They are gearing up for right hand drive deliveries and guided for roughly 6400 deliveries in Q1 as a result. We know that people are gearing up for delivery in the UK and Hong Kong amongst other places and we even have pictures of right hand drive cars. With European deliveries at over roughly over 2,800 in Q1 (not all countries have reported), that means about 3,400 deliveries to U.S. to meet guidance (Canada had 60 in Q1). So less than 1,135 deliveries a month to the U.S. would mean meeting guidance. Higher than 1,135 deliveries to the U.S. would likely mean exceeding guidance, therefore 1,600 is actually quite high.
    8 Apr, 03:05 PM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    tech,

     

    The market is and has been expecting shipments of 6800 to 6900. No one really expected 6400. That was just Tesla setting a low bar in a quarter when they were doing a huge financing. Beating the low bar that no one believed is not a beat.

     

    Also, there are cars in transit at the end of the quarter, but there were last quarter and the quarter before.

     

    There has been a lot of discussion on SA about this quarter being back end loaded. Now we see that March is the same old flat in the U.S. They had a delivery spike in Norway, but not here in the U.S. despite a lot of pull ins that we could all see.

     

    Barclays is basically coming out and saying that Paulo is right. Demand peaked in the U.S. and now its flat. Yesterday Baird said the softness in the stock is the market baking in the lackluster demand in the 1st half. And Baird is a big bull on this story. So the analysts certainly see demand leveling out, at least for now.

     

    Thats why the company shipped delivered so many cars in Norway. The deliveries in Norway are sign that they are no longer production constrained. There would be no reason to put so many cars in Norway if they were short of supply around the world.

     

    This whole "production constrained" story is over. Maybe there will be a pick up at some point. Thats possible as we get into the spring and summer. But right now, its flat, and thats what we are seeing.
    8 Apr, 03:39 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    Tippydog,

     

    You still can't escape the math. For every car delivered in one place, it means a car that cannot be delivered to a different place. The logic escapes you somehow... do you somehow believe that Tesla can just magically create additional cars to probe the depths of demand? Do you even know what the scenario would look like if they did hit the limits of demand? You have zero visibility into demand, just like you have zero data backing up any idea that they are not production constrained. Try modeling the customer deposits amount and you'll see that they are still production constrained.

     

    Mr. Santos is careful to delineate the difference between demand and deliveries for the most part because he knows he has very little information on demand. Hence his entire slant is specious in implying a demand issue. Just like the VIN issuance saga, we just don't have the data. However, we do know that Tesla is likely beating their "low bar" and the question is by how much. 1,600 deliveries in the U.S. for March alone, if true, points to a substantial beat. Autodata has hit and missed enough in the past that their estimates are useless as a predictor.
    8 Apr, 03:54 PM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    There is plenty of data showing the market has expected 6800 units or more all along. This game of guiding for a DECLINE and then beating is so old and tired. We know the drill.

     

    On the demand side, we have this same discussion over and over. Lets go through it again. The leveling off in demand is shown by:

     

    1) lead times in the U.S. are down or flat. They are reported to be flat, but we can see anecdotally that they are in fact shorter.

     

    2) You could get a car in 2 weeks if you ordered it in the beginning of March. If you wanted any of a large inventory of demos and loaners, you could get one in 48 hours.

     

    3) To make this quarter, Tesla pulled in orders. It notified customers in both the U.S. and Europe that cars were scheduled for April were available in March.

     

    4) The order book at December for Model S was flat with September. The increase in reservations backlog is fully accounted for by Model X orders.

     

    Tech, these are all indicators of flattening demand.

     

    5) Then add to this that they did a big price cut in Europe.

     

    6) Add to this that they felt the need to roll out yet another new leasing program.

     

    7)Add to this that there are increasing signs of more cars available for resale.

     

    8) Add to this that analysts, both bulls and bears, are openly talking about lackluster sales in the 1st half. (Barclays, Baird, Goldman Sachs). Even ignoring bearish analysts like B of A.

     

    9)Add to this that Tesla has guided for lower margins, as lower option upsells occur.

     

    No single piece of data is enough. But taken all together, they tell the data driven investor that demand is leveling out.

     

    Why is there so much resistance to this? Demand for cars plateaus. Thats what happens even to hot cars. This is not the first hot car. Thats why car companies keep coming out with new cars. Its not the end of the world. Its just a plateau.

     

    Now, what it means for valuation, that we can have strong differences of opinion about.
    8 Apr, 04:10 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    Tippydog,

     

    Again we reach an impasse where there is too little data and you chose to speculate. That's fine, as long as we are clear where the data ends and where the speculation begins.

     

    1) We have little actual information on lead times.
    2) The only way to get cars fulfilled within 2 weeks is to have purchased a demo car or picked up on someone else's cancelled order. It is rare event.
    3) Again, too little data. Some orders were also delayed.
    4) There was an increase in production quarter over quarter to the level of 15-20%. So a flat order book quarter over quarter actually means an increase of 15-20% due to the increase in deliveries. Again, our visibility is global and any regional analysis is likely fruitless. Further, it is likely that the customer reservation level has increased for Model S. And somehow you are also painting the fact that Tesla has such a robust demand for the Model X as a negative.

     

    The price cut is actually part of the corporate pricing policy that was drawn up as part of China pricing. The fact that you see it as a negative is your prerogative, but you should understand that their "respectful" pricing policy can be viewed as a strength of the company going forward. Matter of fact, Mr. Jerome Gillian of Tesla Motors recently reiterated their pricing strategy to Australian buyers which is consistent with the re-balance of Tesla European pricing. Again, a sign that the company is developing policies and strategies for the long haul.

     

    We do not have enough information to really understand Tesla's demand, and the concept of demand is something worthy of conversation. However, it is not a short term trading issue and certainly doesn't fit a bear thesis. It is almost too difficult to discern demand issues as of yet that isn't something that Tesla is already directly addressing. Efforts like opening more galleries and service centers as well as deploying Superchargers are essentially efforts to drive demand. We just won't see those effects for some time. It is likely that both New England and Georgia will receive substantial upgrades with Superchargers soon and so that should affect demand. But we have so little data - and the data we do have does not point to a drop in demand.
    8 Apr, 04:28 PM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    Tippydog,

     

    "1) We have little actual information on lead times."
    2) The only way to get cars fulfilled within 2 weeks is to have purchased a demo car or picked up on someone else's cancelled order. It is rare event."

     

    We can all see from the Tesla Forum that lead times in the U.S. came down during the 1st quarter. In the U.S., The time from confirm to VIN went to basically zero, the time from confirm to delivery fell by a week or 2.

     

    I personally was told by a Tesla sales rep, in the presence of other sales reps that if I ordered and confirmed immediately, I could get a car in under a month and probably in 2 weeks. Thats a new car, designed to my order not someone else's. I was also told that company can respond much faster now than last year, because production is increased. I was told that the key thing was confirming immediately, not ordering and then waiting to confirm. I was told that if I confirmed immediately, they could get started on it immediately. Not a loaner, not a cancellation.

     

    Tech, how do explain this? Is this just sales talk?

     

    I am sure they will put in superchargers in some states or wherever. Fine. Also putting in new leasing programs, and whatever. Thats what happens when car companies start to feel a blast of cold air.

     

    Look, maybe this will work. I'm not saying they can't work to get some more orders. No one is saying they have no levers to pull. They have levers to pull, for sure.
    8 Apr, 05:18 PM Reply Like
  • tech01x
    , contributor
    Comments (637) | Send Message
     
    Anyone seriously investing in Tesla sees the same data in forums. You have to be careful to know that you are seeing a subset of data and you have to be careful not to cherry pick.

     

    Do you have a name of the Tesla sales rep, or at least the gallery? I just spoke to a salesperson at the Montgomery Mall gallery just now and he said that the current quoted wait time is roughly 2-3 months. 2 weeks is possible, but on the optimistic side for an inventory vehicle (demo, cancelled order, etc.). Certainly production has increased and they are able to respond faster - after all, in 2012 they were still delivering cars for people that had waited years. In 2013, that was still going on at least in the first half of the year.

     

    So again... as a business, if Tesla is able to find buyers for each and every production slot (and we do not have any evidence to the contrary), then why should an investor particularly care about which exact geography is being fulfilled at the moment? Especially when the numbers are pretty robust in the areas of known strong demand and customer orders are increasing. Not only that, customer orders are increasing for a new product line. You see the logical progression of supercharger deployment, leasing programs, galleries, service centers, opening of new markets as all signs of weakness. That seems absurd. If you make the assumption that the company is confident about their outlook, then these exact same moves would be what a confident company would naturally perform.
    8 Apr, 07:24 PM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    Tech,

     

    The reason for our debate is not whether the company is doing well, is deserving of praise, or executing properly against a long term plan. It isn't about whether the company has achieved great penetration in an important high end market. The answer to all of that is of course YES.

     

    We keep having this endless debate because people defending the valuation of Tesla keep saying, mantra like, that it is impossible to form a view on valuation because we can't even see what the likely market size is. We can't possibly know where demand may level off, we just know its massive and goes on beyond the limits of imagination.

     

    And why do they say that? They say this because we all know that once the market size can be determined, we can form a view on what the true earning power of the company is. And once we can do that, there will be no way to justify values anywhere close to the market cap of the company.

     

    Thus, bulls cling to the argument that it can't be sized, earnings can't be predicted until 5 years out, and thus we can't value this company-- we just know its massive.

     

    Despite this almost semantic argument, in reality it does not matter whether the true market size for the combined Model S and MOdel X is 50,000 units, 60,000 or 70,000 units. That market just can't support a value more than $50 per share, soaking wet.

     

    So then we get back to the Model E and this Giga factory albatross.

     

    Apart from valuation, when we see demand for the MOdel S level off, then momentum will be broken. The momentum game depends on constantly increasing revenue and earnings estimates. That can't happen once we see where demand and supply hit equilibrium. And for this reason, Tesla bulls are determined to deny all the visible signs of that equilibrium.
    8 Apr, 08:33 PM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    We are seeing recent wait times for US cars in the 2 month range, even with the increased production rates. There is no demand problem. Tippy has been singing this same tired song every quarter, it never pans out for him, but for some reason he just can't help himself.
    11 Apr, 09:01 AM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    JRP3

     

    "never pans out for him"

     

    I aggressively sold calls in September. Sold them aggressively again when we got to 250. It was by far my largest position.

     

    If thats not panning out, I'm not sure what you mean by panning out.

     

    This stock has coughed up 20 percent of its value. And its on the road to cough up another 10 to 20 percent.

     

    This company is sucking air. It has to be traded carefully, no question.

     

    But this company is in the ejector seat, and wants to be the next flying object ejected from the momentum club. Which is appropriate since its losing its momentum.
    11 Apr, 04:55 PM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    I wasn't referring to your personal trades, which of course I have no knowledge of, I was referring to you claims, which have not equated to reality.
    As for the stock price, in case you missed it, the whole market is taking a dive.
    12 Apr, 09:21 AM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    We were really debating whether we are seeing shorter lead times.

     

    In California, they are way way shorter. I have seen that with my own eyes and ears. I have heard it from people who have bought the car recently. I have heard it from Tesla reps who say things like "its much shorter than last year". And "you can get the car in several weeks if you order and confirm right away."

     

    You just can't square this with your comments that its the same 2 month wait, just like before. Officially, it may be 2 months. There may be some buyers in the U.S. who have to wait 2 months for some reason. The sweet spot, the average buyer, in the U.S. is seeing shorter lead times. And even a 2 week shorter lead time is very material to the supply/ demand equation.

     

    It isn't a bad thing that lead times are shorter. Indeed it may help Tesla sell some cars. Why does Tesla resist acknowledging this? Why do bulls want to hang their argument on this? Its silly.
    12 Apr, 11:54 AM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    You have no idea what the average wait time is because you don't have any access to a large enough data pool. Some people last year were getting wait times under two months, just as they are now, and some longer. Of course I expect wait times to decrease over time, and with the increased production rates they are hitting we may start to see consistently lower wait times. The problem is that does not equate to the decreased demand you keep claiming.
    13 Apr, 09:26 AM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    JRP3.

     

    I truly think that the debate we are having may be more semantic than substantive. I am not saying that demand is declining. I am saying we are getting to a point of equilibrium, where we can see that the size of the demand is in the same zip code as the current run rate.

     

    And that enables us finally to value Tesla based on its actual market size, rather than on euphoria or imagination or fear.
    13 Apr, 12:00 PM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    Since the current run rate has been increasing then we must both agree that demand is also increasing.

     

    As for value, I've always valued Tesla on the future potential I see in them. The more they execute their plan the more potential I see.
    14 Apr, 08:50 PM Reply Like
  • Tippydog
    , contributor
    Comments (1806) | Send Message
     
    JRP3,

     

    Well, we will soon get another datapoint on demand. Evidently Tesla told Andrea James that it really truly will be a down quarter. Maybe some beat from the low bar, but not a blow out. The street didn't believe that, but if Andreas says so maybe we should.

     

    A down quarter, slightly down lead times, big shipments in the last week to Norway. Doesn't sound like strong demand to me, but we will see soon.

     

    In terms of valuing Tesla, there is what is its value, and what is its price. And we have all learned that the price was set by hedge funds trading momentum and short squeeze. Thats dissipated.

     

    As for value, what is an unprofitable car company worth that hopes to sell 35,000 units a year, with all of the growth all back end loaded?
    15 Apr, 09:17 PM Reply Like
  • Ford Prefect 1969
    , contributor
    Comments (2282) | Send Message
     
    @Tippdog

     

    Back to your old tricks again.

     

    You do realize that you are only fooling yourself and your fellow shorts right?

     

    Sproule: "Demand is strong, it may be incumbent upon us to explain the fundamental difference between the Tesla reservation model where demand is backlogged and the traditional sales model where inventory is backlogged to uneducated / willfully misleading commentators"

     

    Or words to that effect.
    15 Apr, 09:35 PM Reply Like
  • yngwie
    , contributor
    Comment (1) | Send Message
     
    I want to tell you speculators a golden rule.
    No knowledge without facts.

     

    Im asking myself whether some of you shorts are taking hallucinating drugs. You guys are making assumptions about demand of model s without proof. You have no idea whats going on with tesla. Tesla is worth $500 in 3 years and $1000 in 10 years? So if youre smart enough, invest in tesla before its too late.
    8 Apr, 03:31 PM Reply Like
  • chipdoctor
    , contributor
    Comments (525) | Send Message
     
    @ yngwie,

     

    You got the right words, just in the wrong order. I fixed it for you.

     

    You have no idea whats going on with Tesla.

     

    Invest in Tesla? Its too late. I'm asking myself whether some of you are taking hallucinating drugs (Tesla being worth $500 in 3 years and $1000 in 10 years).

     

    So if you're smart enough....
    8 Apr, 05:27 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    Ive been short TSLA since $260. So far so good. $203 seems to be the floor.

     

    Technical analysis view. If you take the TSLA candlestick chart and draw a line along the lower highs, and another line along the lower lows, you will notice a downward trending channel. The stock is so far following that channel and is near the channel bottom once again. This would suggest a pop up in the short term. Until TSLA breaks out of this downward trending channel, to the upside or downside, all we know right now is that TSLA is continuing to move down.
    12 Apr, 12:29 PM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    Then why did you claim that you covered your short position about a week ago?
    13 Apr, 09:28 AM Reply Like
  • infinite1
    , contributor
    Comments (45) | Send Message
     
    You longs are just beauties. You spin any number you see in your favor.

     

    Just to make you happy, lets agree to double the number of sales for the quarter okay. Wow, that would be great, except TSLA stock would still not be worth a 30 billion market cap. Now take what could be a 1% growth, quarter to quarter? Buckle up, the clock is ticking, it is going to be ugly.
    8 Apr, 03:48 PM Reply Like
  • pot pie
    , contributor
    Comments (58) | Send Message
     
    I'm wondering why Tesla doesn't release monthly figures like other automobile manufacturers. Why not release them? If I'm long Tesla, I'd be concerned they don't give monthly numbers.

     

    You would think the company would want clarity instead of all this scuttlebutt. Because they don't release monthly figures speaks volumes to me.

     

    All the early adopters and EVangelists have theirs. We'll see how the stateside sales numbers fall soon enough.
    8 Apr, 10:02 PM Reply Like
  • JRP3
    , contributor
    Comments (7604) | Send Message
     
    As a long I'm not the least bit concerned with monthly sales report since monthly fluctuations are meaningless and would only add more volatility to an already volatile stock.
    11 Apr, 09:03 AM Reply Like
  • Doc's Trading
    , contributor
    Comments (623) | Send Message
     
    TSLA.......TSLA update: Stop on short remains at 220.10 closing only....... Expect double bottom at 203-205 to be broken eventually to the downside. If you have no position.... stay flat and hope another piece of news jolts it higher.... then sell the opening on such an occurrence or at the very least sell a nearby call spread.....
    more later....

     

    ...
    9 Apr, 12:32 AM Reply Like
  • Frank Greenhalgh
    , contributor
    Comments (1268) | Send Message
     
    Tesla has a lot on its plate. The Gigafactory location must be decided if the plant is to be built. Money from investors and a battery company's know how is required. Final Design and testing of the X must be finished. Next, construct the factory to build it. Design of the Gen III. Sell S models to provide the only profit. Remember Musk is only working 2 days a week at Tesla (three at Space X. I don't see this happening.
    9 Apr, 08:26 AM Reply Like
  • rafi3
    , contributor
    Comments (15) | Send Message
     
    really again you will relay on AutoData?!?! you guys should learnt by now their numbers way off!
    9 Apr, 04:54 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    Arizona joins ban on Tesla. No selling in Arizona from company-owned dealerships ... for another year!!!

     

    C:\Jts\dhmjjavum\artic...

     

    Auto Dealers Assoc President says legislators not swayed by giggle-factory in Arizona.

     

    Watch out below!
    14 Apr, 10:08 PM Reply Like
  • I need a bailout
    , contributor
    Comments (1228) | Send Message
     
    Expecting a great Q1 report from Tesla? Think again.

     

    http://bit.ly/Rn4SzG
    15 Apr, 09:42 PM Reply Like
  • Ford Prefect 1969
    , contributor
    Comments (2282) | Send Message
     
    "Expecting a great Q1 report from Tesla? Think again.

     

    http://bit.ly/Rn4SzG"

     

    Read the comments under the article, they seem to get it.

     

    The article does not take into consideration the near certainty of a very significant beat on sales.

     

    No way does Tesla scramble at the end of a quarter to deliver what it was sufficiently confident to guarantee in forward guidance. This is a 7000+ delivery blowout quarter.

     

    Never one to miss a good short squeeze. Go TSLA.
    15 Apr, 10:29 PM Reply Like
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