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Per-unit margin goes down (but is still profitable per unit) but you make up in volume to create a profit. Tesla's main costs aren't the cost per unit but the
by fweespeech 10y ago
Per-unit margin goes down (but is still profitable per unit) but you make up in volume to create a profit.
Tesla's main costs aren't the cost per unit but the engineer/software costs iirc.
- cortesoft 10y agoIf they make more profit by selling more units at a lower price... then why don't they always just do that?
- jacquesm 10y agoThey don't make more profit per vehicle, they just made more profit in a short window of time by doing more sales but this may not be sustainable because it just shifts sales around rather in time at a lower profit per vehicle.
- mikeash 10y agoBuilding lots of cars is hard. It takes a lot of time and money to ramp up production capacity to this level. They've been building cars as fast as they could for years now.
- fweespeech 10y agoProduction bottlenecks. Tesla is constantly behind on producing cars for its customers. They just wanted to generate money now rather than later.
- Reason077 10y ago@cortesoft - It takes a lot of time and infrastructure investment to ramp up production to those sort of levels. This has actually been Tesla's business plan all along: start with a low volume, high-priced product (the Roadster) and gradually move towards successively higher volume, lower cost models.
- jrv 10y agoAs per the earnings call, the profit per unit actually went up, and the discounts were never sanctioned and also not relevant to this end result.