Tesla Motors Inc To Face Rival All-Electric Car From Cadillac

While your point DOES support the overall theme of my comment… Tesla by end of 2014 sold roughly 50,000 units GLOBALLY. Current tally for USA is floating around 36-38k of those units total depending where your mark the finish line. This includes fleet, leases, demo cars, etc which wouldn’t get the $7500. With current oil prices factored for 2015, increase of PHEV and clean diesel options from luxury brands, and the “fear factor” present in Joe Rich buying a $100k car that he cant have serviced down the road. I would say I HOPE they sale 160,000 cars in the next 3 years but I’m going to say those numbers won’t hit until after the ? makes is remarkable launch.

this has got to be a headline from “The Onion”

And how long have you worked there? Norwich, 1050 Bing and circle star mean anything to you? I didn’t think so. Using words like bad ass rad and awesome? Dude I was there. I am happy for you, and I am a happy person, I saw way too many shenanigans to believe anything Tesla says anymore. Any means is ok as long as it justified the end result. Tesla breaks laws in a lot of states. If Tesla lived by the same rules financial reporting and laws as the other manufacturers they would be gone. Go back to smoking your blunt…

I disagree with you. Mr. Frost, we have met in person. I made these comments for a number of reasons. One was to see how people view opposition to Tesla. Not well. And there were a few other reasons. It took less than two days for the conversation to go from having a difference of opinion to personal attacks. I hold my position on Tesla based on facts and what I saw personally. Not an article, not personal feelings or sour grapes as you put it. Its people who do not always agree that make changes happen. The company is almost a decade old and has not turned a profit. Period

I’m sorry you are having trouble with basic math so let me dumb it down for you a few notches. Lets say there is this umbrella called TSLA Under it falls Marketing, Manufacturing, service, and parts. I left a few things out so you can keep up. TSLA is not profitable. You can slice dice, manipulate the rose colored glasses all that you would like. Bottom line the company is losing money. Since you have an issue with anger, lets give this a rest and regroup after the earnings report.
Cheers

Thank you for your post! As i told Rfbrost below, I am always happily surprised to find comments that are better than the original article.

No, you stupid [DELTA]. Since you have no clue how automotive accounting is done, I’ll explain it to your dense [ALPHA].

When you decide to build a car, you determine how many of them you intend to build over the course of its lifetime as a product. Tesla Motors has already stated that for the Tesla Model S, that is an eight year period.

You calculate how much it will cost you to design the vehicle, set up tooling, set up a supply chain for materials, set up and deploy robotics, employ and train line workers… You add all that up, divide it by the number of cars you intend to make, add the margin you would like to make, and presto! You have the amount you will sell those cars for….

Each time someone buys one of the cars for that price or more, you log a profit.

What you do NOT do is build a facility that is designed to handle 500,000 of a body style in the next six-to-eight years, build just one car, and then claim that it isn’t profitable because of all the outstanding expenses.

Read a book.

Read a book, would you? The Tesla Model S and Model X are on the same platform. If they can get it to work on the Model S, that means it will work on the Model X. There have been multiple spy photos of the Model S loaded down with weights and sensors in preparation for these features to be released on BOTH models. Elon mentioned way back in January that AWD would be a forthcoming option on Model S. If you don’t like the timing of Tesla’s announcements, don’t check news articles or their website for a couple of years.

Dude. It took YEARS before Apple started making money after the Macintosh II was destroyed on the market by the burgeoning PC compatible market. The company barely stayed afloat, languishing on the meager sustenance they received from media companies that chose to develop on their platform first, like Adobe. If not for Pagemaker, Macromedia, Photoshop, and eventually various digital music programs as well, like Reason, Apple would have died long before the devices were introduced that saved the company from imminent extinction. At one point Bill Gates even invested in the firm, because Microsoft’s issues with the FTC would have been even worse had Apple died prematurely. It was the introduction of iPod and iMac that saved Apple, and yes, those were the babies of Steve Jobs. Their comeback was complete with the introduction of iTunes and the iPhone. Successful companies are brought through hard times by great leaders. Steve Jobs did that for Apple. Elon Musk is doing the same for Tesla Motors.

35,000 vehicles… With an average sale price of $90,000 or more… Comes to $3,150,000,000… With at better than 25% gross margin… Makes a $787,500,000 cash profit on the cars alone… That money is reinvested in the expansion of the Fremont facility, expansion of the Supercharger network, improvements on the Model S, final development of the Model X, design of the upcoming Model ?… Oh, and telling Naysayers to shut the [FLOCK] up. No one will see dividends from their investment in TSLA until sometime in the next decade. But the company will expand into its stock valuation without issue.

Actually, the UAW have an office at the Fremont facility… gratis. It’s just that the employees aren’t interested in unionizing. The union has been knocking on the door since day zero.

It was Toyota’s only unionized manufacturing plant, and they had the excuse of the stock market crash in 2008. So they removed a burden that could not be borne as well without General Motors using the same facility any longer. If Tesla Motors were building V8 powered vehicles that got 90 MPG, they would already be selling 35,000 or more per month. The lack of availability of batteries, along with the need to carefully expand capacity so as to maintain and improve quality means that the Fremont facility is well below maximum output so far. Even if it doesn’t reach a 20,000 unit capacity until 2016, that will still be too quick for all the traditional automobile manufacturers to deal with.

Jose Conseco wrote, “Tesla will be gone soon enough.”

I suggest you divest yourself of their stock, then.

“Any one of the other manufacturers could crush tesla with one swoop of a well designed electric car and their already in place service and parts structure.”

Sure. Look at the Ford Focus Electric, Nissan Leaf, and BMW i3. They all prove your point by the nature of their sheer awesomeness.

“Bottom lines do not lie.”

So sayeth everyone who has predicted the downfall of Amazon for the last fifteen years.

@Jose Conseco your posts are typical of a “sour grapes” employee. From the content of your posts, I would bet that you worked in the Service department at Tesla. Let me suggest that viewing an organization from the ground up, as a rank-and-file employee, is not always the best perspective to understand a company (particularly a startup) and evaluate its future prospects. This is especially true if, as I suspect, you are also a former employee of Toyota that worked in that same facility.

I, by the way, am an early Model S owner, an early Tesla Stock holder, and a serial entrepreneur in California’s High Tech Industry. Being an electronics engineer by training, I was first attracted to Tesla because of their Roaster technology. Further research into the company and Elon Musk motivated me to both put down a $5K deposit on my Model S (sight unseen) and invest $100K in $25/share Tesla stock.

At the time it seemed like I was anything but what you call a “Sheeple”. All the “sharp” MBA’s working as sell-side analysts said that Tesla was a fools errand. Many of these NY bright boys recommended short selling TSLA . This made me even more money because through my stock broker, I was able to earn an extra 6%/mo. in additional income from loaning my TSLA stock to the short sellers for their foolish endeavors.

One particular incident comes to mind when my own entrepreneur experience led me to a correct interpretation of what Elon was saying during an early conference call with the analysts. Elon was describing how he personally went down to the assembly line and inspected the first batch of cars. The financial analyst must have thought that he was “mad”. Why was the CEO “wasting” his time inspecting cars personally? As I listened to these same words, I thought, “this man is a genius!” You see, I ran Operations for a fast growing electronics firm in S. California in the 80’s. I knew that molding the “corporate culture” was an important priority for a startup, perhaps the single activity with the greatest long term payoff. Bottom line, there is often more going on then is apparent to the “casual” observer.

At this same period of time, I spent some effort responding to the “haters” on various comment boards. I eventually decided that it was more important to people to feel that they were “right” then it was to make loads of money. History proved me right, my TSLA investment proved to be a “ten-bagger” and I made a cool $1M. And since my Model S arrived (the first in Spokane WA) the smile has not yet left my face. I love this car and I positively enjoy every time I get in it do drive somewhere!

Finally, as regards to the Service department. Because of an unfortunate fender-bender, and then again when I wanted the latest upgrades (folding mirrors & parking assist), I have had to interact with the Tesla Service department at least half a dozen times. Their mandate is to “Make the customer happy”. This is not something that a “green eye shade” accountant can really understand. Employees are encouraged to “do what it takes, sometimes regardless of cost” to “make the customer happy.” This is NOT as you say, a “bad business practice” but it is further evidence of Elon’s genius. Sale’s experts rank customer satisfaction on a scale from (1) “dissatisfied” to (5) “satisfied” to (10) “delighted”. Tesla, as many companies, does a survey of it’s customers after a service encounter. Elon has mandated that the Service department get 10 out of 10 scores on satisfaction. BTW, I have ranked all of my encounters with the Service department as 10 out of 10. In fact, I have blogged about being MORE then delighted, by the service on my Model S.

This is a Strategic decision that Elon has made. He knows the “world” is watching and as a young company, they must execute as close to perfect as possible. Is this efficient? Hell no! But it is NECESSARY until Tesla has established its Brand and linked it with a perception of Quality (like BMW or Mercedes).

When I ran Operations at the company that I co-founded ($22M/yr. Sales 220 employees), I often had rank and file employees question this or that policy. Was it wise, was it efficient, was it responsible? This was especially true when we tried to do new things. “Well, that is not how my previous company did things,” I was told. Well, that is right. You can not LEAD if you are busy FOLLOWING. Startups are not the best jobs for many people. They are often populated by younger people (with less preconceived ideas) through a self selection process. I suspect, Joe, that you leaving Tesla was part of that self selection process. You would describe it as “Not wanting to drink the Cool-Aide”, thats OK. If you could not “get on board” with the “Tesla Way”, it is best to part company. That does not mean that you are “RIGHT” and Tesla is “WRONG”. Relationships are more about “best fit”. Both can be “RIGHT”. I suggest that you try to put your bitterness about your experience at Tesla behind you. Tesla is doing great things. They deserve your public support. I wish BOTH you and Tesla a happy and prosperous future.

Tesla IS the future of automobiles. We finally have an American car company that is producing a great car that is worth buying. What amazes me most is that the world’s current leading car manufacturers are taking so long to catch up.

I am all for a good argument, let me know when you have one. You’re speaking as a sheeple and have no merit

Elon is no Steve Jobs. Steve Jobs actually had a company making money. Tesla hasn’t made a dime. As long as the stock rises or looks healthy no one is going to confront Tesla over its inability to manage its finances. Its alarming that not one of the sheeple share holders isn’t asking some hard questions of Tesla. Not one of you has even considered what happens if Tesla is audited? If they have to report Service cost per vehicle like all other manufacturers. I don’t have one thing against Tesla or anyone there. This company has the ability to change what we drive. All of us but their lack of leadership, how they snub anyone from the manufacturing or automotive business is arrogant and when the stock begins to slide and it will, all of you will wonder why. Ask Elon what his 2 year marketing and service cost projection costs are. He won’t have a clue. They just spend money recklessly. Another person posting here said Tesla’s profits per vehicle were twice what any other manufacturer is. Get of the pipe, good gawd…. You can’t pick two lines off the financial statement and compare them and say look here is profit. What is the bottom line at Tesla. Losses. I personally want to see the stock hit $600 a share. If some of you that attend the share holders meetings start asking some hard questions they might make it. Hold them accountable.

If you look at the supercharger map, and move the slider to (year end 2014), you will see that Tesla says the “Midwest to Miami” route will be complete by Dec. 2014. Just in time for the snowbird owners to drive their Model S to Florida.

You might not agree that they will complete the route, but that’s another issue. Tesla says they will.

It’s quite possible that the X is not shipping because the line isn’t ready, and the quantity of batteries that Tesla would need, won’t be available from Panasonic for 6 months.

Sandy – The D had to be developed and tested before it could be incorporated into the Model X SUV. Easy enough to incorporate it on an existing production car (Model S).

Tesla doubled the number of superchargers from 100 in May 2014, to 200 in Sept. 2014. That’s pretty good progress for 4 months. They are being rolled out at a very fast pace. Remember, this time last year, they essentially didn’t exist outside of California. Take a look at the supercharger map on Tesla’s web site, and move the slider to (year end) 2014. That’s pretty good coverage, and it’s forecast to happen over the next 2 1/2 months.

There is a difference between Tesla investing in Assets, spending on R&D, vs wasting it on frivolous things like Fiskar automotive did. Tesla’s average profit margin per vehicle is more than double everyone else’s. The fact is that dealer network is killing existing automakers profit margins causing them to squeeze every penny even more, and end up with not enough. Tesla’s margin will come down, but GM and others can’t make theirs go up without taking plays from Tesla’s playbook. If you hadn’t noticed, Elon Musk’s vision for Tesla is to push electric car adoption, even if it’s not their electric car. They would call it success if Ford crushed them on electric car sales. That’s the difference between desctructive competition and constructive competition.

you own stocks in the company yet you are bashing the company…really makes sense.

Not that that changes the facts, but no I was not fired by the company.

I know you were there. Were you also fired by the company?

Toyota boarded up the Nummi plant and skipped town, leaving thousands of Californians out of work. Thousands of households. Try telling the kids in those households that even though Toyota made a profit, they decided to close the factory anyway, so no extra toys this year.

Maybe you can get a job with Toyota. Weren’t they in the Nummi plant before Tesla? How did that work out for the employees?

$3 billion dollars will be the 2014 SALES Revenue number. Sales were $2 Billion in 2013. That’s 60% sales growth. 2012 $400M; 2011 $200M; 2010 $100M. No other automaker is growing sales like that. From your post, it sounds like you were at Tesla, and you were let go, and now you are bitter, so you hope they don’t succeed. I’m sorry it didn’t work out for you, but it doesn’t make the company any less successful. Profits without sales growth is a dead end for a business.

It doesn’t really matter does it. All it means is I know more than anyone you will ever have an exchange with. Including you

But what car do they make that competes with the Model S, the Lexus LS?
Well the Model S already out sells it!

The company is 3 billion dollars because of stock prices not because its profitable. Once they run out of rich people to buy and buy, they will have to take back in their own used cars because they have no resale. Toyota dumped the EV because they DID NOT sell. Period.
Once the people who have invested start to see the stock slide, it will be a sell off. Then the company will be worth jack diddly or worthless. It can be saved but not being run like it is.

Quick – can you name another explosive growth company in a capital intense industry? Probably can’t. That’s because they don’t come along very often. And when they do, they typically farm out their manufacturing to China. Fact is – you need lots of capital to grow a $100M company into a $3 billion dollar company in 4 years time. Every dollar of gross margin needs to be plowed back into R&D and equipment to continue to grow at 60% annually, and manage your own factory. I would be concerned if sales were tailing off, but that’s just not the case. The fact that established automakers are failing at trying to compete with Tesla’s products is very sad.

Tesla will be gone soon enough. Brilliant ideas and products never stay on the market when the company cannot live within its means. Tesla is hemorrhaging cash, has no new ideas, tired designs. Although none of that matters. What does is this: Compare HP to Compaq HP crushed them. Why? Because they perfected execution and financial management. Any one of the other manufacturers could crush tesla with one swoop of a well designed electric car and their already in place service and parts structure. Tesla is a neat product but run by a staff that has no idea what they are doing. Bottom lines do not lie.

GM just doesn’t get it. If they build an “all electric” car, without investing in a supercharging network, then they will just have an expensive car that can’t be used to take road trips. GM doesn’t even know why they are losing. Pathetic.

The company that crushes their own electric cars is going to make another Crapallac

Well, I wasted this click, Cadillac is thinking of a new car, hmm, never would’ve guessed that on my own. They should just add the 200mile battery option to the ELR that they already invested R&D into.

Yeah. I’ll believe it when I see it. They said the same about the ELR too. It is averaging 75 cars a month or 1 1/2 cars per month.

LOL