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Old 25th October 2018, 10:59   #1
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Default Tesla announces a surprise profit for Q3 2018-2019

Closely tied to the success of Model 3, Tesla finally turned a profit, posting net income attributable to shareholders of approximately $311.5 million.

The Q3 results come after many quarters of losses, and Tesla shares are up 12 percent in after-hours trading .

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Old 26th October 2018, 18:21   #2
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Originally Posted by volkman10 View Post
Closely tied to the success of Model 3, Tesla finally turned a profit, posting net income attributable to shareholders of approximately $311.5 million.
Being based in the US makes it impossible to go through a day without getting some Tesla news (or Trump noise for that matter). Personally, I am not surprised one bit by this news.

I have driven the Model 3 - it is, at least tech wise, leagues ahead of any car I've ever used or driven. There seems to be a lot of press desperate for Tesla to fail and for the EV dream to be delayed.

The reality is, Tesla have done a few things right and they are bearing fruit now.
1) Top down - start with expensive cars, Model S & X, and then go mass when you are ready.
2) Supercharger network is amazing. I plotted a route from NYC to Chicago. Did that in a Honda Civic two years ago. On that trip we stopped for Breakfast (25 minutes), Lunch (35 minutes) and coffee (20 minutes) over the 800 mile trip. Today, I can replicate that exact trip with those same speeds in a model 3. Range anxiety is virtually gone.
3) Tesla cars are desirable. The branding, image, design, and geeky level of tech has elevated their brand from "need" to "want". People are spending above their original budgets to get a Tesla.
4) In terms of revenue, Tesla Model 3 outsold every car in the US in the past 2 months.

The competition has realised they are being affected, particularly BMW 3, Merc C, Audi A4 range of cars and they have a lot to fear. By the time they bring models to market, Tesla will have innovated further.

Far from being a Tesla fan, I am just happy that this is happening. I want to see a world of silent, emission free cars that can be run off solar/hydro/wind power. The EV revolution is here, and I am excited to see what happens next.

On a side note - watch out for Kia/Hyundai who have the most viable alternative to the Tesla. For now.
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Old 26th October 2018, 20:41   #3
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Originally Posted by carmayogi View Post
....impossible to go through a day without getting some Tesla news (or Trump noise for that matter). Personally, I am not surprised one bit by this news.
....
I agree with you on every single point. Musk has been going crazy on Twitter for a while too.

Tesla is simply too good and their cars feel like a generation ahead. The Model 3 is brilliant and I'm not kidding. It is simply way more advanced than any other car I've been in. Forget NYC to Chicago, you can drive LA to NYC now with a reliable supercharging network. As you said, taking 30-minute breaks is key.

I think the press is funded by the traditional auto lobby. Musk has proved that EVs are more than 'just feasible.'

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Old 26th October 2018, 22:40   #4
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Originally Posted by carmayogi View Post
Being based in the US makes it impossible to go through a day without getting some Tesla news (or Trump noise for that matter). Personally, I am not surprised one bit by this news.
Pretty much all the big traditional auto manufacturers spend billions in ad spend every year. http://www.autonews.com/article/2016...-spending-list
When the automotive news channels & magazines depend so much on such ad spend, it was impossible for them to write a completely positive review of the Model 3. This is the reason they note some positives but end up calling it a draw between cars like Bolt/Leaf and Model 3. Car & Driver brushes aside issues like a user interface with a lot of lag in the Jaguar iPace. They don't provide the exact 0-60 times. Clearly it is not better than the TM3, TM3 perf dual, or the TMS dual with Ludicrous mode (which is an ancient model now). So, they decide to hide important figures and publish an elaborate ad disguised as a review/first impression 125 pictures, and no hard comparative numbers. https://www.caranddriver.com/reviews...t-drive-review It is the same with auto dealers, they are putting up a fight, hoping to hold on to their business model.

Most analysts got Tesla wrong, but I feel they did that on purpose - hoping to make the threat of Tesla go away.
https://arstechnica.com/cars/2018/10...critics-wrong/

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Old 26th October 2018, 22:56   #5
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

I would call creative accounting on this one.

A company with a long history of not living up to delivery or financial milestones suddenly turning a profit is very suspicious.

Dont quote audit reports - those would be listed under 'fiction' in bookshops these days.
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Old 27th October 2018, 20:12   #6
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I would call creative accounting on this one.

A company with a long history of not living up to delivery or financial milestones suddenly turning a profit is very suspicious.

Dont quote audit reports - those would be listed under 'fiction' in bookshops these days.
This would be true if Tesla didn't have so many bears determined to make the Tesla story negative. Here in NYC, all the financial guys have been tearing into Tesla's numbers and they haven't found anything that's suspicious at all. The reality is, they sold over 56,000 Model 3's at an average price of over 50,000 dollars. That itself is close to half of the revenue they declared. Add to that, 25,000 S & X models that average over 100,000 and you have another few billions.

The profit and delivery numbers are not suspicious. They are delayed. I live in NYC and there are so many Model 3s on the road - this is not even an EV dominated market with parking and charging being very difficult here.

Quote:
Originally Posted by GutsyGibbon View Post

Most analysts got Tesla wrong, but I feel they did that on purpose - hoping to make the threat of Tesla go away.
https://arstechnica.com/cars/2018/10...critics-wrong/
Very similar to when iPhone was coming. The dinosaurs (at that time) are now dead. Nokia, Ericsson, Siemens, Blackberry.

Of course, the tech world moves faster than the auto world, but a lot of the global majors are suffering while Telsa moves forward. Funny thing is Hyundai/Kia are recreating the story of Samsung (in the Apple example above) as the Korean company making the most of tech innovations. Their EV portfolio is very promising.

Last edited by theMAG : 28th October 2018 at 02:23. Reason: Back-back posts merged.
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Old 27th October 2018, 22:01   #7
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Originally Posted by carmayogi View Post
I live in NYC and there are so many Model 3s on the road - this is not even an EV dominated
My observation: It is raining TM3s in SoCal. Employers, hotels, and utilities are installing chargers at a rapid pace. Costs nothing to big employers with huge parking lots, & solar installations, to provide free charging(NEMA 14-50). People who were in the market for a $35k car are stretching their budgets to buy the TM3. The EV alternatives available now are simply far behind.

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Old 28th October 2018, 11:34   #8
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

Some interesting observation of Tesla progress over the last 8 years:

Tesla opened its first factory on 27th Oct, 2010 (8 years ago). It was a former GM-Toyota factory which Tesla purchased for $42 million.

GM valuation in Oct 2010: $46 billion
Tesla valuation in Oct 2010: $1 billion

GM valuation in Oct 2018: $46 billion
Tesla valuation in Oct 2018: $56 billion

Tesla developed 3 vehicles in these 8 years. Model S is outselling all other competition in US capturing 1/3rd of market share in large sedans. Model X is selling in similar numbers to Model S. In Q3, 2018 Tesla outsold Mercedes, Audi in US and just slightly behind Lexus and BMW. They are already No. 1 in terms of revenue among luxury brands. Tesla revenues in China exceeded $2 billion in 2017.

Most importantly all the Teslas are full-electric vehicles which faced many issues initially with no fast chargers initially. They built extensive supercharger network across all the countries where they are selling their cars.
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Old 28th October 2018, 14:10   #9
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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This would be true if Tesla didn't have so many bears determined to make the Tesla story negative. Here in NYC, all the financial guys have been tearing into Tesla's numbers and they haven't found anything that's suspicious at all.
There are a whole list of companies that have fudged their numbers despite more scrutiny.

There are whole chapters on how one can manipulate production, despatch and delivery numbers and hide costs to magically turn the corner. Tesla themselves have been known to carry out last-bit assembly at delivery centers to pop up the factory production and despatch numbers, which have resulted in a lot of finish issues.

Will be happy to see them succeed because i firmly believe in the EV revolution, but the management has been known to play to the gallery and is more focussed on managing perception than the business itself - hence I will take magical turnaround stories with a large helping of salt. They are in the valuation game and not the vehicle production business.

I remain skeptical.

Last edited by Steeroid : 28th October 2018 at 14:12.
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Old 28th October 2018, 21:28   #10
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Will be happy to see them succeed because i firmly believe in the EV revolution, but the management has been known to play to the gallery and is more focussed on managing perception than the business itself - hence I will take magical turnaround stories with a large helping of salt. They are in the valuation game and not the vehicle production business.

I remain skeptical.
In a way, it is essential that they play to the gallery because they have to make the concept of EVs cool. For years we were told they're merely glorified golf-carts. In that sense, Tesla is doing a service to the industry by forcing others to participate. They have also pushed battery tech forward for sure. The whole self-driving + autopilot stuff is great, but the reality of the world we live in is that the EV part is what is essential.

For a country like ours, we need EV buses, trucks and cars as fast as possible. Pollution (social) and oil imports (economic) problems can be tackled in this way. Sunny India only needs solar panels + chargers after all. In many ways, I am more excited about the Kia E-Niro/Hyundai Kona EV. These cars are approaching the prices that would sell in India - still high, but much closer. Can't wait to see the next moves in this revolution.
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Old 28th October 2018, 23:06   #11
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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Originally Posted by carmayogi View Post

For a country like ours, we need EV buses, trucks and cars as fast as possible. Pollution (social) and oil imports (economic) problems can be tackled in this way. Sunny India only needs solar panels + chargers after all. In many ways, I am more excited about the Kia E-Niro/Hyundai Kona EV. These cars are approaching the prices that would sell in India - still high, but much closer. Can't wait to see the next moves in this revolution.
The technology is established, and we need mature players rather than cool guys.

There’s a LOT happening in India, just not in the public domain yet. Wait another couple of years - they have set things in motion and the change is irreversible.
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Old 29th October 2018, 02:16   #12
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The technology is established, and we need mature players rather than cool guys.
There’s a LOT happening in India, just not in the public domain yet. Wait another couple of years - they have set things in motion and the change is irreversible.
Sure, the EV transmission has been here for a while. Mature players as in big-oil/ICE auto majors? The battle with big-oil is not over. I am never sure about the electric infrastructure for economies of scale and the ability to convince the masses to make the switch. When it comes to US elections, you hear "Drill baby drill" get louder all the time. Look at this recent win by big-oil https://www.businessinsider.com/trum...illing-2018-10

In many US states where there is a healthy oil economy they have managed to pass bills that Tax EVs instead of giving incentives. If they manage to drop down gas prices with irresponsible drilling, the switch to EVs can remain elusive.

To convince people to ditch something that has been working very well, and switch to something that costs same or more in the short run, is a tough one. I am not talking about convincing a technology enthusiast, or an engineer driven by facts. Why would my Corvette driving carpenter - neighbor vote to switch the school buses to have an electric drive train? When the current bus is working, and the break-even point is after 10 years or so - it is a tough sell. Add on the fact that politicians around the world keep breaking promises, (& the dark clouds of corruption with big projects) it simply isnt a convincing argument for policy makers.

We will need large public figures to get behind these big ideas. If not cool guys, then scientists, or even god men who can influence the masses (and the govt.). I would support Baba ramdev and a Patanjali EV too - if he can raise the kind of capital needed, and get people to signup.

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Old 29th October 2018, 08:01   #13
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

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The technology is established, and we need mature players rather than cool guys.
Who are these so called mature players are we talking here? The likes of VW, Toyota, Honda who does not even bring their popular petrol/diesel cars despite being in India for decades? Even when they eventually bring their EVs after 4-5 years, they will be way overpriced just like their mild hybrids.

India will move to EVs slowly as and when it becomes cheap. Initial EVs from all the mature players will be overpriced and find very less takers. I strongly believe Chinese companies will rule the Indian EV market just like they did with smartphone, solar industries. The likes BYD, MG motors (SAIC) will bring their EVs ahead of other mature players and will be priced competitively. BYD and Foton motors are already selling their full-electric buses in India.
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Old 29th October 2018, 08:23   #14
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Default Re: Tesla incurs loss of £523 million. EDIT: Now posts a profit!

I think India will see a jump to EVs more than Hybrids. Similar things have happened in other technologies. We dont go through a transient period.
Just wait for Maruti to introduce the Wagon-R. If they play right (right looks and good interiors please), people with premium cars will buy these or the Kia.
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Old 29th October 2018, 11:52   #15
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Tesla announces a surprise profit for Q3 2018-2019 - Posts moved to a new thread.
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