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Why are people so obsessed with picking some parts Tesla revenue and claim that what makes it profitable. What makes them profitable is all the ways that make r

by nickik 5y ago

Why are people so obsessed with picking some parts Tesla revenue and claim that what makes it profitable. What makes them profitable is all the ways that make revenue and all the ways they spend money. Bitcoin was relevant for 1 Quarter. And trading in fuel credits has been a thing in the automotive industry for decades and are simply a normal part of the business. You might as well point to specific spending and say 'they are only not more profitable because of XY'. They have a ~20% unit margin excluding credits so clearly they are making a massive amount of money selling cars. If they weren't selling credits they would likely spend differently and still show moderate profitability. Their goal is not maximum profitability but maximum growth while showing consistent profitability.

maverick-iceman 5y ago
> Why are people so obsessed with picking some parts Tesla revenue Because people (for the most part) aren't fools, especially on here. People see a 600B dollar company and expect it to feel its presence in their lives each and every day. They expect to use the thing, or their employer to use the thing or their supplier to use the thing on a daily basis like it happens with Exxon, Amazon, Microsoft, Google, Facebook, Netflix, Salesforce, Oracle, IBM... They all earned their significance by touching so many lives and making people lives a tad better and less complicated for their users, and the rise to riches of their founders has happened in lockstep or almost lockstep with the changes and the improvement they were making in people's lives. With Tesla you have a 600B company and Porsches (which are a rarity on their own) are still more common then them on our roads. People are suspicious about unjustifed enrichment, always been, always will be. "What have you done for me to deserve that amount of money? What have you done for society to deserve that amount of money?" Such question will always come up. Musk has been able to answer to such question up to now with: 1) "Give me time!" and 2) "Wait, neat things are a-comin" as well as 3) "Population wide morale boost given by the prospect of amazing future is the real product" People are more and more asking questions though, and he keeps answering with postponements and future deadlines, while Teslas are still less common than Porsches
- lotsofpulp 5y ago
  Tesla delivers twice as many cars as Porsche. https://ir.tesla.com/press-release/tesla-q4-2020-vehicle-production-deliveries https://ir.tesla.com/press-release/tesla-q4-2020-vehicle-pro... https://newsroom.porsche.com/en/company/annual-sustainability-report-2020.html https://newsroom.porsche.com/en/company/annual-sustainabilit... And Porsche is stagnant compared to Tesla: https://www.statista.com/statistics/502208/tesla-quarterly-vehicle-deliveries/ https://www.statista.com/statistics/502208/tesla-quarterly-v... https://www.statista.com/statistics/263854/sales-development-of-porsche-worldwide-since-1995/ https://www.statista.com/statistics/263854/sales-development... >With Tesla you have a 600B company and Porsches (which are a rarity on their own) are still more common then them on our roads. I have seen far more Teslas than Porsches up and down the west coast.
  - maverick-iceman 5y ago
    And , in fact...what's Porsche's marketcap? N/A They are private but the approximation can be extracted from Ferrari: 45.5B Now, where does the remaining 555B come from?
    - lotsofpulp 5y ago
      Porsche is not private, it is a subsidiary of Volkswagen which is a publicly traded company. Porsche has 3B euro of profit per year, per Wikipedia, and I would guess it is worth far less than $46B if it were to be sold today since they seem to have stagnated. I do not know what Ferrari has to do with Porsche. If your question is why is the outstanding number of shares of Tesla multiplied by the most recent share price of Tesla equal to $x, then there are multiple answers. The simplest is because someone decided they wanted to buy the most recent share of Tesla at $y. The slightly more complicated one is that that person decided that buying that share was a better use of their money than whatever other alternative they had. The most complicated answer is going to be that many actors in the market are betting Tesla is going to “grow” by market share or new technologies over some nebulous amount of time, and that given all the investment options, people are allocating that amount to Tesla compared to others.
lostcolony 5y ago
So as a note, this whole tangent is built on my -aside- "and, amusingly, they made more money from Bitcoin than car sales". An interesting aside, that is a point both in favor and against Tesla with respect to the original post, but ultimately not that relevant with the core proposition I was making that Tesla is not like Uber, and could reasonably be argued to not be the kind of company that is kept afloat solely by VCs, to the detriment of would-be competitors, unlike Uber. And, as you mention, emission credits are something all competitors can take advantage of. Bitcoin kind of is too, though speculative investments outside of the business the company is in strikes me as just as problematic as debt/equity funding an unprofitable company. But not the point I was trying to make. I actually was putting them in the "reliable profit" category, unlike Uber. Though if being profitable requires governmental incentives and speculation on crypto, maybe not so much.

by nickik 5y ago

maverick-iceman 5y ago

> Why are people so obsessed with picking some parts Tesla revenue Because people (for the most part) aren't fools, especially on here. People see a 600B dollar company and expect it to feel its presence in their lives each and every day. They expect to use the thing, or their employer to use the thing or their supplier to use the thing on a daily basis like it happens with Exxon, Amazon, Microsoft, Google, Facebook, Netflix, Salesforce, Oracle, IBM... They all earned their significance by touching so many lives and making people lives a tad better and less complicated for their users, and the rise to riches of their founders has happened in lockstep or almost lockstep with the changes and the improvement they were making in people's lives. With Tesla you have a 600B company and Porsches (which are a rarity on their own) are still more common then them on our roads. People are suspicious about unjustifed enrichment, always been, always will be. "What have you done for me to deserve that amount of money? What have you done for society to deserve that amount of money?" Such question will always come up. Musk has been able to answer to such question up to now with: 1) "Give me time!" and 2) "Wait, neat things are a-comin" as well as 3) "Population wide morale boost given by the prospect of amazing future is the real product" People are more and more asking questions though, and he keeps answering with postponements and future deadlines, while Teslas are still less common than Porsches

lotsofpulp 5y ago
Tesla delivers twice as many cars as Porsche. https://ir.tesla.com/press-release/tesla-q4-2020-vehicle-production-deliveries https://ir.tesla.com/press-release/tesla-q4-2020-vehicle-pro... https://newsroom.porsche.com/en/company/annual-sustainability-report-2020.html https://newsroom.porsche.com/en/company/annual-sustainabilit... And Porsche is stagnant compared to Tesla: https://www.statista.com/statistics/502208/tesla-quarterly-vehicle-deliveries/ https://www.statista.com/statistics/502208/tesla-quarterly-v... https://www.statista.com/statistics/263854/sales-development-of-porsche-worldwide-since-1995/ https://www.statista.com/statistics/263854/sales-development... >With Tesla you have a 600B company and Porsches (which are a rarity on their own) are still more common then them on our roads. I have seen far more Teslas than Porsches up and down the west coast.
- maverick-iceman 5y ago
  And , in fact...what's Porsche's marketcap? N/A They are private but the approximation can be extracted from Ferrari: 45.5B Now, where does the remaining 555B come from?
  - lotsofpulp 5y ago
    Porsche is not private, it is a subsidiary of Volkswagen which is a publicly traded company. Porsche has 3B euro of profit per year, per Wikipedia, and I would guess it is worth far less than $46B if it were to be sold today since they seem to have stagnated. I do not know what Ferrari has to do with Porsche. If your question is why is the outstanding number of shares of Tesla multiplied by the most recent share price of Tesla equal to $x, then there are multiple answers. The simplest is because someone decided they wanted to buy the most recent share of Tesla at $y. The slightly more complicated one is that that person decided that buying that share was a better use of their money than whatever other alternative they had. The most complicated answer is going to be that many actors in the market are betting Tesla is going to “grow” by market share or new technologies over some nebulous amount of time, and that given all the investment options, people are allocating that amount to Tesla compared to others.

lostcolony 5y ago

So as a note, this whole tangent is built on my -aside- "and, amusingly, they made more money from Bitcoin than car sales". An interesting aside, that is a point both in favor and against Tesla with respect to the original post, but ultimately not that relevant with the core proposition I was making that Tesla is not like Uber, and could reasonably be argued to not be the kind of company that is kept afloat solely by VCs, to the detriment of would-be competitors, unlike Uber. And, as you mention, emission credits are something all competitors can take advantage of. Bitcoin kind of is too, though speculative investments outside of the business the company is in strikes me as just as problematic as debt/equity funding an unprofitable company. But not the point I was trying to make. I actually was putting them in the "reliable profit" category, unlike Uber. Though if being profitable requires governmental incentives and speculation on crypto, maybe not so much.