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All of Tesla’s models have a healthy gross margin, meaning that their economics get healthier with every car they sell. Tesla as a whole still operates at a lo
by marvin 7y ago
All of Tesla’s models have a healthy gross margin, meaning that their economics get healthier with every car they sell.
Tesla as a whole still operates at a loss, but that’s to be expected with the massive expansion of production capacity they’ve been continuously doing since 2012.
- semi-extrinsic 7y agoOK, I should rephrase that. They are not losing money on every car. But they are still far from being profitable selling hundreds of thousands of $35k cars. According to the letter Musk himself posted in early January of 2019, he said they can squeeze out a tiny profit when selling the top end Model 3s at $45k+. And that they have a big effort ahead to make a profit selling $35k cars. This is a far cry away from a healthy gross margin. https://www.tesla.com/blog/tesla-company-update?redirect=no https://www.tesla.com/blog/tesla-company-update?redirect=no
- legacynl 7y agoThere is a healthy margin on every car they sell. They just invested so much that they are still not making a profit. The way I'm reading it is that they can make a profit if they sell them at 45k, but they rather sell them at 35k to sell MORE. Expansion has a cost, and it's the reason why they're not making a profit.
- semi-extrinsic 7y agoNo, the point is they are currently not selling any at $35k. They are filling the high-end orders first, hoping that they can do $35k profitably in the end.
- kingnothing 7y agoYou can walk in to a Tesla store and buy the $35k car today. It's just not for sale on their web site.
- pmorici 7y agoTheir reported ASP last quarter, Q2, on the model 3 was 50k.