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This post is overly optimistic and largely fails to address the 800 pound gorilla in the room: Tesla is selling cars at a loss. Once Tesla has to operate like a
by SeanDav 10y ago
This post is overly optimistic and largely fails to address the 800 pound gorilla in the room: Tesla is selling cars at a loss. Once Tesla has to operate like a normal company and sell cars to make a profit, it is almost certain that pricing will rise dramatically.
It is possible that other branches of the business could subsidize car sales indefinitely, but highly unlikely.
- csulok 10y agoTesla is operating at a loss, but Model S and Model X are sold at a high margin comparable to other cars in their category. Source: share holder letters.
- aquadrop 10y agoThey are selling cars at loss because of large capital investments in the future. If you look at R&D department of BMW, it won't be profitable, but it has rest of the established business of BMW to support it. Tesla now is a large R&D department, which waits for rest of the company to grow up.
- codeulike 10y agoTesla would be profitable if it just sold the Model S. Its burning through cash because of R+D and capital expenditure. e.g. building the biggest factory in the world in order to make batteries cheaper.
- refurb 10y agoNo it's not. The Model S has a positive gross profit, but if you ignore capex and r&d, the company is still losing money.