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Most car companies include R&D in COGS. So it's fair to point out that Tesla does not.
by damoncali 11y ago
Most car companies include R&D in COGS. So it's fair to point out that Tesla does not.
- greglindahl 11y agoIndeed, Tesla does things like startups do, not like big car companies. If you have a steady-state business, including R&D in COGS makes sense. Another way that Tesla is different is that they don't announce monthly sales numbers. That means that a fair number of analysts ignore them; here's an example [1]. http://www.nytimes.com/2015/07/02/business/us-monthly-auto-sales-june.html http://www.nytimes.com/2015/07/02/business/us-monthly-auto-s...
- OrwellianChild 11y agoThough, to be fair, Tesla's monthly numbers would be like 4k/month, which in the ballpark of Porsche, and you don't see them on the analyst's list either...
- greglindahl 11y agoPorche had no chance of nearly being the fastest growing car, 52% (Tesla) vs 55% (Elantra). Of course it's always up to what the financial reporter thinks is important, but I'd bet that Tesla's slightly-late release of their quarterly number vs. reliable monthly updates from existing companies played a role.
- msandford 11y agoMost car companies already have mature vehicle platforms (engines, transmissions, chassis and body experience, etc) to work off of and thus only have to charge R&D for a particular car against that car. When you're developing a new car you have to do a lot of general R&D and a lot of car-specific R&D. What gets charged against the car and what are considered general? Who gets to decide? Why would they decide in a particular way? It's not super obvious to me where you'd bill things even if they're ostensibly just for the Model S because in another year or two they might release a Model S2 with not a lot of R&D because they just stole parts from the Model S, Model X and Model 3. Not saying it will happen, but it could. Then the R&D costs would be too low on that car and they'd have to go back and adjust their gross margin back as far as they've been selling the other cars and then the whole thing is a nightmare since I'm pretty sure the SEC won't let you do that.
- damoncali 11y agoIt's not a indefensible position. But it is different, and makes direct comparisons more difficult.
- greglindahl 11y agoThe numbers released to the public include enough information to make direct comparisons. The problem is that it's really apples-to-oranges: large, not-growing-very-fast car companies are a very different beast from small, rapidly-growing, risky new entrants.
- deleted 11y ago[deleted]
- ajross 11y agoI suppose. Most car companies (i.e. all other car companies) don't have 56% year-over-year growth numbers either (per the linked article). So my money is with the "apples and oranges" crowd here. Analyzing an investment in Tesla according to the rules you use for GM or Daimler is going to lose you a lot of money. Or realistically already has -- most people whining are whining because they didn't get in on the Tesla boom and are looking for reasons to prove it's a bubble.
- hinkley 11y agoJust a data point, I became an investor just this year and I'm up 35%. If you're still whining instead of acting then nobody can help you but you.
- dang 11y ago> If you're still whining instead of acting Please don't be personally rude on HN. This comment would be fine with just the first sentence.