6 ms·

So wait, does this mean Tesla are finally making cars faster than they can sell them?

by moomin 4y ago

bamboozled 4y ago
What does this have to do with anything sorry ? If the current price was warranted why would the price be lowered regardless of the output ?
- hervature 4y ago
  Because the "current" price is always warranted based on supply and demand. If supply > demand, economics 101 says the price is too high.
  - moomin 4y ago
    It _could_ be good news for Tesla, in that it means they can actually sell to all of their potential customers. Being supply-side constrained is usually a bad thing for a stock’s share price. Mind you, something’s inarguably up with the share price, even if it isn’t as simple as this discount.
    - jacquesm 4y ago
      That's some pretty interesting mental gymnastics right there. It could be good news, but most CEOs would interpret their stock price tanking as a result of having too much inventory as bad news. And those other brands can usually sell to their dealers so they can recognize the profits, Tesla can't do that hence these consumer discounts. And it isn't the people that wait for next year that are buying Tesla at this discount either, but it is the people that bought one two weeks ago that feel screwed by this extra discount that they have foregone by supporting Tesla in what arguably must have been one of its most difficult times so far.
    - bell-cot 4y ago
      _Could_ be good news, yes...if Tesla's share price was not at "assume they can still grow their market share 10X, plus enjoy 10X the industry-average per-vehicle profits indefinitely" heights. As is - the discounts bear a disquieting resemblance to cold facts contradicting those optimistic assumption.
- jsemrau 4y ago
  There is an assumption that Tesla has peaked as competitors are successful in gaining market share. Rivian's successful of Amazon launch [1], Lucid is starting in Europe [2], and NIO is opening up in Europe. Is Tesla, given that scenario, really a 372B company (as of Dec 23rd) or rather a 45B company like Ford and GM? [1]https://app.finclout.io/t/9Q2MQ8d https://app.finclout.io/t/9Q2MQ8d [2]https://app.finclout.io/t/mOaRRwY https://app.finclout.io/t/mOaRRwY
  - mlindner 4y ago
    A generally unfounded one as Tesla has always done discounts/pushes of various sorts at the end of quarters and especially at the end of the year.
  - x0x0 4y ago
    I think Tesla gifting the pickup truck market to Rivian and Ford w/ their Lightning is one of the biggest own goals in a long time. And I think Tesla should worry less about Lucid, etc than Volkswagon working out the kinks in their id.4 (what a terrible name that is), and Toyota's revamped Prius, which looks like a very appealing bridge car that can still use gas on road trips.
  - karmasimida 4y ago
    Hyundai and Chinese competitors are ramping up quickly as well I would imagine major Japanese/American manufacturers to follow suite Tesla’s reign of EV is going to be over in next 5 years. Maybe they can differentiate more on software but it is not going to sustain their margin
    - bamboozled 4y ago
      I also think there is a market for less software in cars? My phone contains all the software my car needs and it does it better than any car I’ve used. I can also upgrade my phone without upgrading my car.
      - Tossrock 4y ago
eecc 4y ago
I guess so, but just because some sweet subsidies are coming January 1 so everyone is procrastinating orders to that date. In practice it’s just Tesla “chipping in” a bit of the profit boost it will get next year, to avoid ruining their quarterly sales metrics. Either way the TSLAQ crowd will have a field day with all the negative attention Musk is getting: they’re toast, they can’t sell without discounts, they’re not a carmaker but only a subsidy taker.
- Eisenstein 4y ago
  What is TSLAQ?
  - lossolo 4y ago
    From first google result: > TSLAQ (pronounced "Tesla Q") is a loose, international collective of largely anonymous short-sellers, skeptics, and researchers who openly criticize Tesla
    - tromp 4y ago
      Somewhat confusing considering that Tesla Model Q is one of the rumored names for the new cheaper compact model (aka Model 2). https://topelectricsuv.com/news/tesla/tesla-model-2-design-details/ https://topelectricsuv.com/news/tesla/tesla-model-2-design-d...
      - FireBeyond 4y ago
        Musk has a habit, a la Boris Johnson, of "snowing" search results that are likely to be unfavorable with his own (Johnson made a big show of repeatedly talking about "painting wine boxes to look like buses" to distract from a campaign issue about Brexit and contentious claims painted on buses). "Did you mean Tesla Model Q?", might say Google in the future, when someone looks for Tesla Q. https://www.wired.co.uk/article/boris-johnson-model-google-news https://www.wired.co.uk/article/boris-johnson-model-google-n...
bfung 4y ago
No - The discounts are happening because of the Inflation Reduction Act that take effect in 2023. The IRA would give a $3500 tax credit for purchasing an EV, like Tesla Model Y. It takes about ~6 months for people who order a Tesla to get it delivered. For people who ordered in June, they want the IRA tax credit so many considered cancelling or delaying taking delivery until 2023. This Tesla incentive is to make those people take delivery in 2022 Q4 so that quarterly earnings report would smooth out, instead of dead Q4 and huge spike in Q1 2023. Edit: my parents are taking delivery this week and are now super happy. They considered cancelling a few weeks back knowing their delivery date was 1 week before 2023. Refs: https://finance.yahoo.com/news/tesla-offers-discount-car-models-051117307.html https://finance.yahoo.com/news/tesla-offers-discount-car-mod...
- benj111 4y ago
  Why would you want to maintain Q4 sales at the expense of profitability unless it is to maintain stock price though? And as it's obviously having the opposite effect there's no good reason for doing that.
  - danaris 4y ago
    Doesn't mean they didn't think it would help the stock price...
  - bfung 4y ago
    1. Employees, esp the ones with more authority and up the management chain, has a lot at stake in stock compensation. 2. Having and holding inventory, while not bad, creates a whole slew of internal supply chain challenges. Unsure if Tesla as a company actually knows how to deal with that well since most of their existence has been not holding any inventory of completed vehicles. It could cause company problems that would cost way more to deal with than they have people & investment to fix it with.
- karmasimida 4y ago
  I just checked their delivery date in California If you are buying Model Y, you can have readily available inventory If you are buying model 3, the delivery date is about a month The demand is absolutely softening

So wait, does this mean Tesla are finally making cars faster than they can sell them?

by moomin 4y ago

So wait, does this mean Tesla are finally making cars faster than they can sell them?

What does this have to do with anything sorry ? If the current price was warranted why would the price be lowered regardless of the output ?

hervature 4y ago
Because the "current" price is always warranted based on supply and demand. If supply > demand, economics 101 says the price is too high.
- moomin 4y ago
  It _could_ be good news for Tesla, in that it means they can actually sell to all of their potential customers. Being supply-side constrained is usually a bad thing for a stock’s share price. Mind you, something’s inarguably up with the share price, even if it isn’t as simple as this discount.
  - jacquesm 4y ago
    That's some pretty interesting mental gymnastics right there. It could be good news, but most CEOs would interpret their stock price tanking as a result of having too much inventory as bad news. And those other brands can usually sell to their dealers so they can recognize the profits, Tesla can't do that hence these consumer discounts. And it isn't the people that wait for next year that are buying Tesla at this discount either, but it is the people that bought one two weeks ago that feel screwed by this extra discount that they have foregone by supporting Tesla in what arguably must have been one of its most difficult times so far.
  - bell-cot 4y ago
    _Could_ be good news, yes...if Tesla's share price was not at "assume they can still grow their market share 10X, plus enjoy 10X the industry-average per-vehicle profits indefinitely" heights. As is - the discounts bear a disquieting resemblance to cold facts contradicting those optimistic assumption.
jsemrau 4y ago
There is an assumption that Tesla has peaked as competitors are successful in gaining market share. Rivian's successful of Amazon launch [1], Lucid is starting in Europe [2], and NIO is opening up in Europe. Is Tesla, given that scenario, really a 372B company (as of Dec 23rd) or rather a 45B company like Ford and GM? [1]https://app.finclout.io/t/9Q2MQ8d https://app.finclout.io/t/9Q2MQ8d [2]https://app.finclout.io/t/mOaRRwY https://app.finclout.io/t/mOaRRwY
- mlindner 4y ago
  A generally unfounded one as Tesla has always done discounts/pushes of various sorts at the end of quarters and especially at the end of the year.
- x0x0 4y ago
  I think Tesla gifting the pickup truck market to Rivian and Ford w/ their Lightning is one of the biggest own goals in a long time. And I think Tesla should worry less about Lucid, etc than Volkswagon working out the kinks in their id.4 (what a terrible name that is), and Toyota's revamped Prius, which looks like a very appealing bridge car that can still use gas on road trips.
- karmasimida 4y ago
  Hyundai and Chinese competitors are ramping up quickly as well I would imagine major Japanese/American manufacturers to follow suite Tesla’s reign of EV is going to be over in next 5 years. Maybe they can differentiate more on software but it is not going to sustain their margin
  - bamboozled 4y ago
    I also think there is a market for less software in cars? My phone contains all the software my car needs and it does it better than any car I’ve used. I can also upgrade my phone without upgrading my car.
    - Tossrock 4y ago

eecc 4y ago

I guess so, but just because some sweet subsidies are coming January 1 so everyone is procrastinating orders to that date. In practice it’s just Tesla “chipping in” a bit of the profit boost it will get next year, to avoid ruining their quarterly sales metrics. Either way the TSLAQ crowd will have a field day with all the negative attention Musk is getting: they’re toast, they can’t sell without discounts, they’re not a carmaker but only a subsidy taker.

Eisenstein 4y ago
What is TSLAQ?
- lossolo 4y ago
  From first google result: > TSLAQ (pronounced "Tesla Q") is a loose, international collective of largely anonymous short-sellers, skeptics, and researchers who openly criticize Tesla
  - tromp 4y ago
    Somewhat confusing considering that Tesla Model Q is one of the rumored names for the new cheaper compact model (aka Model 2). https://topelectricsuv.com/news/tesla/tesla-model-2-design-details/ https://topelectricsuv.com/news/tesla/tesla-model-2-design-d...
    - FireBeyond 4y ago
      Musk has a habit, a la Boris Johnson, of "snowing" search results that are likely to be unfavorable with his own (Johnson made a big show of repeatedly talking about "painting wine boxes to look like buses" to distract from a campaign issue about Brexit and contentious claims painted on buses). "Did you mean Tesla Model Q?", might say Google in the future, when someone looks for Tesla Q. https://www.wired.co.uk/article/boris-johnson-model-google-news https://www.wired.co.uk/article/boris-johnson-model-google-n...

bfung 4y ago

No - The discounts are happening because of the Inflation Reduction Act that take effect in 2023. The IRA would give a $3500 tax credit for purchasing an EV, like Tesla Model Y. It takes about ~6 months for people who order a Tesla to get it delivered. For people who ordered in June, they want the IRA tax credit so many considered cancelling or delaying taking delivery until 2023. This Tesla incentive is to make those people take delivery in 2022 Q4 so that quarterly earnings report would smooth out, instead of dead Q4 and huge spike in Q1 2023. Edit: my parents are taking delivery this week and are now super happy. They considered cancelling a few weeks back knowing their delivery date was 1 week before 2023. Refs: https://finance.yahoo.com/news/tesla-offers-discount-car-models-051117307.html https://finance.yahoo.com/news/tesla-offers-discount-car-mod...

benj111 4y ago
Why would you want to maintain Q4 sales at the expense of profitability unless it is to maintain stock price though? And as it's obviously having the opposite effect there's no good reason for doing that.
- danaris 4y ago
  Doesn't mean they didn't think it would help the stock price...
- bfung 4y ago
  1. Employees, esp the ones with more authority and up the management chain, has a lot at stake in stock compensation. 2. Having and holding inventory, while not bad, creates a whole slew of internal supply chain challenges. Unsure if Tesla as a company actually knows how to deal with that well since most of their existence has been not holding any inventory of completed vehicles. It could cause company problems that would cost way more to deal with than they have people & investment to fix it with.
karmasimida 4y ago
I just checked their delivery date in California If you are buying Model Y, you can have readily available inventory If you are buying model 3, the delivery date is about a month The demand is absolutely softening