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The base price on the Model 3 today is $49,000 and Tesla's own IR documents state that they don't expect to have a positive gross margin, even at that price poi
by dangrossman 9y ago
The base price on the Model 3 today is $49,000 and Tesla's own IR documents state that they don't expect to have a positive gross margin, even at that price point, until some time in the distant future after production is fully ramped up at both Fremont and the Gigafactory. It's not a very good example of the point I think you're trying to make.
- jsight 9y agoThey definitely haven't said that margins would be negative until the "distant future".
- richardknop 9y agoThey are selling for a loss currently. Any margins from model S and X are being used to subsidise model 3 and overall they are still losing tons of money, profitability not even on the horizon. I wonder how long their current runway is without raising new cash again.
- jsight 9y agoThat is mostly right, but I was responding to someone who said that positive gross margins for the vehicle were only planned for the distant future. Their financial statement for last quarter implied that the 3 would have positive gross margins in late 2018. Their cash position decreased by about 162 million last quarter and they have ~3.3 billion on hand at the end of Q4. There are a lot of risks still out there due to the production bottlenecks that currently exist (and maybe more on the horizon with S and X), but the cashflow situation isn't as horrible as some want to believe.