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Tesla is definitely hitting the demand ceiling. It's a good thing Musk isn't producing 10000 M3 per week. The current rate of ~4500 per week is enough to meet d

Tesla is definitely hitting the demand ceiling. It's a good thing Musk isn't producing 10000 M3 per week. The current rate of ~4500 per week is enough to meet demand. In fact, expect continuous price drops from Tesla as it struggles to drum up enthusiasm

bryanlarsen 8y ago
Demand ceiling for the US or for the world? I suspect they've hit the former, but that there's a lot of demand in the latter.
- wnorris 8y ago
  The market for EVs is expanding. As Tesla starts shipping worldwide they will find the sweet spot for the US. Big takeaway here is they are very profitable producing at current rates. As they bring out new models they will continue to grow at 30-50% per year.
  - golfer 8y ago
    > "they are very profitable producing at current rates" You don't know that. They had one big, profitable, immaculate quarter in Q3 by pulling all demand forward and using every accounting trick in the book to show profit. There is no guarantee there will be another quarter like that. In fact, if Tesla's earnings history shows anything, it's that losses will be even bigger than before.
    - cjhopman 8y ago
      q3 was also helped by the fact that, despite increasing the total amount of tesla's sold by ~66%, they opened only 1.1% new service centers and only 3.2% new superchargers. The tesla experience is going to be incredibly degraded as time goes by.
    - qroshan 8y ago
      Bingo! Q3 and Q4 numbers should absolutely be taken with a grain of salt. It was a confluence of all positive points. a) Accounting b) Pent up demand for larger priced vehicles c) Peak Economy Going forward, a) Weakened Global Economy b) Everyone who is passionate about owning Tesla has bought one. Sustainable demand and profit will be clearer in 2019 Q2 and forward. I can make a public bet that it wouldn't be greater than $150 Million per quarter
      - greenleafjacob 8y ago
        https://predictionbook.com/predictions/194051 https://predictionbook.com/predictions/194051
  - deleted 8y ago
    [deleted]
MBCook 8y ago
I’m not pro-Tesla, I think they’re horribly mismanaged, but let’s be real. The Model 3 is selling well, and ONLY in the US. Even if they hit peak demand they can just start selling to Europe and China (planned for later this year) and they’ll have plenty of new customers.
- nihonde 8y ago
  China has a higher barrier to entry than any other market, esp. in the EV market, which is going to favor the homegrown options. The current trade war isn’t going to help Tesla. My prediction is that Tesla remains a novelty brand in Asia. Japan is similarly capable of taking care of its own market, and I wouldn’t want to take on Toyota when it comes to exports to South Asia, Africa, etc.
  - timdorr 8y ago
    That's why they're building a factory in Shanghai right now: https://electrek.co/2018/12/31/elon-musk-groundbreaking-tesla-gigafactory-3-china/ https://electrek.co/2018/12/31/elon-musk-groundbreaking-tesl...
  - xedeon 8y ago
    > China has a higher barrier to entry than any other market, esp. in the EV market, which is going to favor the homegrown options. Tesla is already positioned ahead of other auto makers with the construction of the Gigafactory 3 along with a deal with the Shanghai government to build a wholly-owned local factory (a notable exception).
    - nihonde 8y ago
      Not ahead of Chinese automakers. And Tesla is paying for the privilege of that foothold. Meanwhile, Toyota is firing up battery supply in Thailand. Not to mention that Panasonic and Chinese suppliers are the real source of Tesla batteries.
      - xedeon 8y ago
mavhc 8y ago
They're not even really selling outside North America yet, so that's silly. Of course there's a ceiling of expensive cars, they're selling more of them than anyone else, right?
- qroshan 8y ago
  Yes, it's called Pent up Demand. We don't what sustainable demand for M3 is yet. For US, you'll see that in Q1. For Rest of the world, Q2 will paint that picture. So, whatever profit (or loss) Tesla makes in Q2/Q3 are truer numbers. It would have also reached a steady state. Tesla's marketcap should be at the most 100x Q2 profit. TSLA is definitely over-priced

bryanlarsen 8y ago

Demand ceiling for the US or for the world? I suspect they've hit the former, but that there's a lot of demand in the latter.

wnorris 8y ago
The market for EVs is expanding. As Tesla starts shipping worldwide they will find the sweet spot for the US. Big takeaway here is they are very profitable producing at current rates. As they bring out new models they will continue to grow at 30-50% per year.
- golfer 8y ago
  > "they are very profitable producing at current rates" You don't know that. They had one big, profitable, immaculate quarter in Q3 by pulling all demand forward and using every accounting trick in the book to show profit. There is no guarantee there will be another quarter like that. In fact, if Tesla's earnings history shows anything, it's that losses will be even bigger than before.
  - cjhopman 8y ago
    q3 was also helped by the fact that, despite increasing the total amount of tesla's sold by ~66%, they opened only 1.1% new service centers and only 3.2% new superchargers. The tesla experience is going to be incredibly degraded as time goes by.
  - qroshan 8y ago
    Bingo! Q3 and Q4 numbers should absolutely be taken with a grain of salt. It was a confluence of all positive points. a) Accounting b) Pent up demand for larger priced vehicles c) Peak Economy Going forward, a) Weakened Global Economy b) Everyone who is passionate about owning Tesla has bought one. Sustainable demand and profit will be clearer in 2019 Q2 and forward. I can make a public bet that it wouldn't be greater than $150 Million per quarter
    - greenleafjacob 8y ago
      https://predictionbook.com/predictions/194051 https://predictionbook.com/predictions/194051
- deleted 8y ago
  [deleted]

MBCook 8y ago

I’m not pro-Tesla, I think they’re horribly mismanaged, but let’s be real. The Model 3 is selling well, and ONLY in the US. Even if they hit peak demand they can just start selling to Europe and China (planned for later this year) and they’ll have plenty of new customers.

nihonde 8y ago
China has a higher barrier to entry than any other market, esp. in the EV market, which is going to favor the homegrown options. The current trade war isn’t going to help Tesla. My prediction is that Tesla remains a novelty brand in Asia. Japan is similarly capable of taking care of its own market, and I wouldn’t want to take on Toyota when it comes to exports to South Asia, Africa, etc.
- timdorr 8y ago
  That's why they're building a factory in Shanghai right now: https://electrek.co/2018/12/31/elon-musk-groundbreaking-tesla-gigafactory-3-china/ https://electrek.co/2018/12/31/elon-musk-groundbreaking-tesl...
- xedeon 8y ago
  > China has a higher barrier to entry than any other market, esp. in the EV market, which is going to favor the homegrown options. Tesla is already positioned ahead of other auto makers with the construction of the Gigafactory 3 along with a deal with the Shanghai government to build a wholly-owned local factory (a notable exception).
  - nihonde 8y ago
    Not ahead of Chinese automakers. And Tesla is paying for the privilege of that foothold. Meanwhile, Toyota is firing up battery supply in Thailand. Not to mention that Panasonic and Chinese suppliers are the real source of Tesla batteries.
    - xedeon 8y ago

mavhc 8y ago

They're not even really selling outside North America yet, so that's silly. Of course there's a ceiling of expensive cars, they're selling more of them than anyone else, right?

qroshan 8y ago
Yes, it's called Pent up Demand. We don't what sustainable demand for M3 is yet. For US, you'll see that in Q1. For Rest of the world, Q2 will paint that picture. So, whatever profit (or loss) Tesla makes in Q2/Q3 are truer numbers. It would have also reached a steady state. Tesla's marketcap should be at the most 100x Q2 profit. TSLA is definitely over-priced