> Model x and a have 25% profit margins Part of the short thesis is that they are hiding warranty repairs in "Services and Other" - underreserving for warranty

> Model x and a have 25% profit margins Part of the short thesis is that they are hiding warranty repairs in "Services and Other" - underreserving for warranty would make those margins artificially high. They reserve $3000/car - considering that just the 3 people I know with Model S's have all had a drive unit replaced, one had a battery replaced, between them I have lost count of the number of door handle replacements - I think there is something to that. Even if their per car margins are high, they still have a negative operating margin. If you can't make money selling cars, does it really matter what your automotive gross margin is? I think the focus on those margins is a major misdirect away from the fact that the capital they've been raising has been used for operational costs as well as capex - which implies that they aren't "reinvesting profits in growth" but dependent on cash infusions for survival. And it seems to have worked based on the TMC and Reddit TeslaMotors threads - people think that the gross margins on the cars means they are making money if you ignore their investing in the future, which just isn't true. Aside: My favorite bull response while sharing this information so far was "source" on my claim they had negative operating profit from someone who was "heavily invested in the stock" -- it's those stripey pages at the beginning of those reports you should be reading as an investor. I try to follow the bull reasoning as much as possible but it's really hard when a lot of it is just based on faith in Elon - I don't really know how to model that.