teslamotorclub: Q4 2013 results - data points, projections and expectations part 1

During the yesterday's interview with NYT financial columnist Andrew Sorkin, Elon Musk mentioned that Tesla Motors has "almost 25,000 cars on the road"

1min 20sec mark: http://dealbook.nytimes.com/2013/11/12/elon-musks-next-blue-sky-idea/?_r=0

So, pulling out my abacus and doing the math:

Roadsters sold: 2,400
Q4 2012 Model S sold: 2,600
Q1 2013 Model S sold: 4,900
Q2 2013 Model S sold: 5,150
Q3 2013 Model S sold: 5,500
TOTAL delivered to customers: 20,550
Total worldwide demo fleet: 69 stores x 5 cars = 345 cars
Total worldwide loaner fleet: 53 SC x 5 cars = 265 cars
TOTAL on the road: 21,160

Assuming that "almost 25,000 cars on the road" equal to a minimum of 24,500 cars, Tesla as of yesterday delivered 24,500-21,160 = 3,340 cars. It is not clear if deliveries will be linear throughout the quarter, but assuming that they are, means that Tesla could deliver 3,340 x 6 /12 = 6680 vehicles in Q4. This seem to be kind of in line with their projection of 6,000 cars and the level of conservatism that they usually build into the projections. It also yields average production of 556 cars per week.

There is a maximum of 500 cars per quarter (41 cars/week) upside for these numbers if there are more than 24,500 cars on the road.

The downside depens on the average quantity of demo cars/store and loaner cars/SC. Assuming that each has an additional car above the 5 cars used in calculation will yield reduction by 69 + 53 = 122 cars/quarter (10 cars/week).

There is no allowance to cars in transition to Europe because Deepak Ahuja mentioned during the Q3 call that pipe of the deliveries to Europe is filled.
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Previously Elon had said real ramp up after 25% margin met. I don't know how to interpret that. If prior to end of qtr at 25% will large ramp up start or only into 1st qtr. i think the date of start of ramp up more important than plus minus 500 cars. Also guidance for next year will trump as well.
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Nice research.

It always puzzles me why it takes so long for them to produce their quarterly earnings. Like... it's 5 weeks. Alcoa does a better job I guess the upside is, by the time ER comes along, Tesla already have good intel on how good the next quarter is going. Perhaps this is what led to Elon's remark.

Based on my personal experience ordering a car right now, I can say that the delays talked about by U.S. buyers appear to have been cleared up... they're back on their normal timeframe, like perhaps 6 weeks (i.e. 4-8 weeks depending on what is ordered). So perhaps there was a delay, but now they are really moving.
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vgrinshpun said: ?

Elon Musk mentioned that Tesla Motors has "almost 25,000 cars on the road"
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You're forgetting the 2600 or so Roadsters. Musk is including those in his count.
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smorgasbord said: ?

You're forgetting the 2600 or so Roadsters. Musk is including those in his count.
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The roadsters were included, see first line. I used 2400 based on count given by Wikipedia.
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Data point from Tilburg. I was discussing with my Tesla contact there about a few last minute things and while asking if they had any spare sets of rims around so that I could swap the silver 21" for gray 21" wheels he said that they are fully crammed up with cars and have 0 space for anything else because they are going to deliver 25 cars / day in November and December so they need all the space they have for just the cars. Now the part in his wording that was vague to me is if they already do that (from the discussion I'd strongly imply they are) and if that is since mid-November now or already all of November. If we assume Nov+Dec doing just weekdays we get ~80 days of 25/day we get to 2000 cars delivered in Tilburg in November and December alone.

I have no clue if they consider delivering cars in Tilburg also for cars that go to Germany etc or only Tilburg pickup cars. I would assume it's all of EU (except Norway and Switzerland that gets the cars straight from Fremont). If this is true and there were also deliveries in October, then of the Tesla guidance 6000 cars delivered we might see a good half in Europe (adding NO, CH to the ~2200-2500 EU other cars).
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Mario Kadastik said: ?

Data point from Tilburg. I was discussing with my Tesla contact there about a few last minute things and while asking if they had any spare sets of rims around so that I could swap the silver 21" for gray 21" wheels he said that they are fully crammed up with cars and have 0 space for anything else because they are going to deliver 25 cars / day in November and December so they need all the space they have for just the cars. Now the part in his wording that was vague to me is if they already do that (from the discussion I'd strongly imply they are) and if that is since mid-November now or already all of November. If we assume Nov+Dec doing just weekdays we get ~80 days of 25/day we get to 2000 cars delivered in Tilburg in November and December alone.

I have no clue if they consider delivering cars in Tilburg also for cars that go to Germany etc or only Tilburg pickup cars. I would assume it's all of EU (except Norway and Switzerland that gets the cars straight from Fremont). If this is true and there were also deliveries in October, then of the Tesla guidance 6000 cars delivered we might see a good half in Europe (adding NO, CH to the ~2200-2500 EU other cars).
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Interesting! (Especially the part where you find 80 weekdays in Nov+Dec ;-)) I would probably at least halve that amount for max 1000 cars out the door before New Year.

Edited: I mean, after October. Do we know how many delivered in October?
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Bwahaha I don't know what kind of nice magic math I did Indeed 8 weeks meaning 40 weekdays So yeah 1000 cars, which is far less impressive now It's still a QoQ increase I think, but not as much as I'd have hoped.
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vgrinshpun said: ?

The roadsters were included, see first line. I used 2400 based on count given by Wikipedia.
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Sorry I missed that. Wikipedia is certainly missing the 100 extra roadsters that were added near the end of the production run.

I believe the correct number to use is 2500. (not that that affects your calculations significantly)
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According to post from The Model S Delivery Update thread (#6152, dated 11-02) there was a ramp-up in production. It would be nice if we can get a confirmation from another source:
I just asked the question. My DS just called and told me that my s85 would go into production on December 16th and scheduled my pick up for December 20th. He said that they have ramped up production and there is a good chance my car will even go into production before that. I just checked my dashboard and it has not changed since the day i placed my order. When do you recieve your vin numbers? ?

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Without too many datapoints, save for the famed 570/week photo from early q4, and knowing they like to underpromise and slightly overdeliver, I am expecting 6200-6300 cars sold (delivered) this quarter.
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For what it's worth:

Musk also said that Model S sales are higher than expected so far in the fourth quarter.
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http://finance.yahoo.com/news/tesla-ceo-expects-feds-clear-223604731.html
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JRP3 said: ?

For what it's worth:

Musk also said that Model S sales are higher than expected so far in the fourth quarter.

http://finance.yahoo.com/news/tesla-ceo-expects-feds-clear-223604731.html
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I wonder if the article means reservations or deliveries?
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We need pic of a big red bow on a Tesla Model S to send to people as Christmas gift hints (a la Lexus ads).
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tentonine said: ?

I wonder if the article means reservations or deliveries?
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Strickly speaking sales means deliveries (not orders). I hope BOTH are higher than target
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FredTMC said: ?

Strickly speaking sales means deliveries (not orders). I hope BOTH are higher than target
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Higher than expected deliveries would be consistent with the ramped-up production reported on Model S Delivery Update thread - reference post #10 in this thread.
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vgrinshpun said: ?

Higher than expected deliveries would be consistent with the ramped-up production reported on Model S Delivery Update thread - reference post #10 in this thread.
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Anyone know anyone who's been to the factory lately?
wouodbe interesting to see what their take is as perhaps they have gotten a glimpse of what the current weekly run rate is.
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TSLAopt said: ?

Anyone know anyone who's been to the factory lately?
wouodbe interesting to see what their take is as perhaps they have gotten a glimpse of what the current weekly run rate is.
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Somewhere I thought someone said they were at the factory like last week and still being quoted a 550/wk production rate.
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uselesslogin said: ?

Somewhere I thought someone said they were at the factory like last week and still being quoted a 550/wk production rate.
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Bummer, I hope Panasonic gets their act together soon. I'm under the impression that the battery supply constraint is the only thing holding us back right now from ramping up further.
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uselesslogin said: ?

Somewhere I thought someone said they were at the factory like last week and still being quoted a 550/wk production rate.
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The 550 cars per week with two running shifts was reported by DJ Frustration yesterday - in the Tesla Fremont Factory Work Schedule thread (post #6):

I was on a factory tour last week. They are working two shifts and producing 550 cars per day as of the end of last week. ?

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vgrinshpun said: ?

The 550 cars per week with two running shifts was reported by DJ Frustration yesterday - in the Tesla Fremont Factory Work Schedule thread (post #6):
I was on a factory tour last week. They are working two shifts and producing 550 cars per day as of the end of last week. ?
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wow! That would be 2750 cars per week, sweet! Jk, I'm sure he meant 550 per week.

anyone have any guesses on where demand is right now?
If there was no supply constraint and ability to build as many as they wanted where do you think we'd be at?
1000 per week? 2000 per week?
(ie. even if reservation rate is only 500-700 per week right now it wouldn't be evident as a lot more people would be lining up to reserve/buy a Model S all over the world if there wasn't a 3-12 month waiting time and they could get the car in 4-6 weeks).

on nothing other than "gut feeling" I would say 1600 per week and that figure would likely grow for a while.
600 week in US
200 week in China
200 week in Norway
400 per week in rest of Europe
200 per week in rest of world
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Just to make sure people don't get overly optimistic the Q4 numbers might come out ahead of guidance etc, but Q4 is also when Tesla reports FY2014 guidance. Now various things indicate that the battery supply issue isn't solved yet (latest example being Elon's tweet about the difference of battery tech in SCTY offer and that there is no short term constraint THERE). Then the report about the ramp up of battery production by panasonic is expected by second half of 2014.

So while we all throw around numbers like 40k cars in 2014 the cautious scenario may be that from Q1-Q2 Tesla can't really ramp up car production going between 550-650 cars a week (so say 25 weeks x 600 average = 15000 cars) and then in the second half they could ramp up and end the year at Elon's guided 800 cars / week (25 weeks x 725 average = ~18 000 cars) which gives a guidance of 33k. So do not be surprised if Tesla is conservative and guides for 30k cars in 2014. This will be far below the expectations and will kill the stock at least in the short term post-ER.

This is just to keep everyone thinking realistically as Tesla is most likely ready to do 1000+ cars / week already now, but they are constrained by some subcontractors. Until we get a clear indication that this is resolved I'd be cautious about the 2014 guidance.
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I think max on two shifts is about 800/week, unless they start doing overtime again.
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JRP3 said: ?

I think max on two shifts is about 800/week, unless they start doing overtime again.
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The precise number for the "design" capacity of the assembly line is 83 cars per day according to Gilbert Passin, Tesla Motors Manufacturing VP (http://www.edmunds.com/autoobserver-archive/2011/10/tesla-wows-with-model-s-rides-factory-tour.html). The weekly (5 working days) capacity is then 415 cars. Then two shift operation would yield 830 cars per week.

There was a discussion at the end of the Q3 2013 call on how Tesla would approach task of producing 80-100K cars/year (40-50K Model S and 40-50K Model X). I was surprised to hear Elon mentioning that existing line would not be able to produce in such numbers.

Up to the time when I heard Elon state this my assumption was that scaling from 83 cars per day in three shifts would add up to 249 cars/day, and then assuming 48 weeks, 7 days per week operation would result in total production of more than 83K cars.

It seems, however, that current internal thinking does not include 3 shift operation, and Elon during the call indicated that some reconfiguration of the assembly line would be required to scale production up to these levels.

The complete exchange betwee Elon and Patrick Archambault of Goldman Sachs:

Patrick Archambault - Goldman Sachs
Got you. If I can, just one more just on, how you are going to configure your manufacturing sort of going into the end of this year? Does your current line have flexibility or will have flexibility to build Model Ss and Xs going through the same line or are you going to have to sort to build a parallel one.
Ultimately, I think the original expectations you put out was 40 to 50 global units of demand for S. Clearly, that would probably at some point the setup you have now but just kind of wondering when that additional capacity would go in and how it might be configured?

Elon Musk - Chairman of the Board, Chief Executive Officer, Product Architect
We have a game plan on that front because, obviously, if we are doing 40 or 50 in Model S volume, if Model X turns out to have a comparable demand and we are on the order of 100,000 units then clearly our current production line is not going to do the trick. So we are going to need something else and we are looking at reconfiguring a part of the factory, maybe using one of the moving production lines that's still there from the NUMMI days but I feel pretty confident. I mean it's not going to be any, the production of vehicle is not going to be constraint. That's not a limiting factor. No doubt we have got some sort of huge capital, training thing that's going to need to happen. I think we have got a handle on how to get there.
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vgrinshpun said: ?

The precise number for the "design" capacity of the assembly line is 83 cars per day according to Gilbert Passin, Tesla Motors Manufacturing VP (http://www.edmunds.com/autoobserver-archive/2011/10/tesla-wows-with-model-s-rides-factory-tour.html). The weekly (5 working days) capacity is then 415 cars. Then two shift operation would yield 830 cars per week.

There was a discussion at the end of the Q3 2013 call on how Tesla would approach task of producing 80-100K cars/year (40-50K Model S and 40-50K Model X). I was surprised to hear Elon mentioning that existing line would not be able to produce in such numbers.

Up to the time when I heard Elon state this my assumption was that scaling from 83 cars per day in three shifts would add up to 249 cars/day, and then assuming 48 weeks, 7 days per week operation would result in total production of more than 83K cars.

It seems, however, that current internal thinking does not include 3 shift operation, and Elon during the call indicated that some reconfiguration of the assembly line would be required to scale production up to these levels.

The complete exchange betwee Elon and Patrick Archambault of Goldman Sachs:

Patrick Archambault - Goldman Sachs
Got you. If I can, just one more just on, how you are going to configure your manufacturing sort of going into the end of this year? Does your current line have flexibility or will have flexibility to build Model Ss and Xs going through the same line or are you going to have to sort to build a parallel one.
Ultimately, I think the original expectations you put out was 40 to 50 global units of demand for S. Clearly, that would probably at some point the setup you have now but just kind of wondering when that additional capacity would go in and how it might be configured?

Elon Musk - Chairman of the Board, Chief Executive Officer, Product Architect
We have a game plan on that front because, obviously, if we are doing 40 or 50 in Model S volume, if Model X turns out to have a comparable demand and we are on the order of 100,000 units then clearly our current production line is not going to do the trick. So we are going to need something else and we are looking at reconfiguring a part of the factory, maybe using one of the moving production lines that's still there from the NUMMI days but I feel pretty confident. I mean it's not going to be any, the production of vehicle is not going to be constraint. That's not a limiting factor. No doubt we have got some sort of huge capital, training thing that's going to need to happen. I think we have got a handle on how to get there.
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My two cents. This Q&A was somewhat reassuring to me. Suggests they are still planning for over 40k MS in 2014 and up to maybe the same amount of MX. I read on TMC somewhere that a separate body assembly line for MX will be used in the near term and that longer term it may be on same line as MS. I DO believe that TM has a handle on ramping to over 40k MS in 2014. Let me put it another way: if TN guides to anything less than 40k units of MS in 2014 then the stock price is going to take a major hit. Elon has always said he wants to test limits of demand in 2014. I certainly hope TM mgmt realizes after the Q3 earnings debacle that they are a growth company and they need to continue to grow at least as fast as their stated guidance. And, Exceeding their guidance is the real key to maintaining the stock price. Remember that Elon has an incentive plan to hit. The car fires didn't help of course. I think we'd be back into the 160s without those damn fires and NHTSA pending verdict.
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vgrinshpun said: ?

The precise number for the "design" capacity of the assembly line is 83 cars per day according to Gilbert Passin, Tesla Motors Manufacturing VP (http://www.edmunds.com/autoobserver-archive/2011/10/tesla-wows-with-model-s-rides-factory-tour.html). The weekly (5 working days) capacity is then 415 cars. Then two shift operation would yield 830 cars per week.

It seems, however, that current internal thinking does not include 3 shift operation, and Elon during the call indicated that some reconfiguration of the assembly line would be required to scale production up to these levels.
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We don't hear much from Gilbert anymore do we? Wonder if his title/role has changed.
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DrDave said: ?

We don't hear much from Gilbert anymore do we? Wonder if his title/role has changed.
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Both Tesla Motors Executives page and his LinkedIn page list him as TM Manufacturing VP. I guess that he is really busy working on scaling up production/planning reconfiguring of the current assembly line. :wink:
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Elon already said a while back that the current line is designed for 40k units/year. He also said that they can expand to 50k units/year with very minimal capital expenditure of $25m - $50m.

Anything over $50m would probably require a lot more CAPEX and probably installing a completely new line.

For those who don't know Elon has said that batteries are now the ONLY constraint, that they worked everything else out with suppliers. It is only the batteries holding them up.
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FredTMC said: ?

Let me put it another way: if TN guides to anything less than 40k units of MS in 2014 then the stock price is going to take a major hit. Elon has always said he wants to test limits of demand in 2014. I certainly hope TM mgmt realizes after the Q3 earnings debacle that they are a growth company and they need to continue to grow at least as fast as their stated guidance. And, Exceeding their guidance is the real key to maintaining the stock price. Remember that Elon has an incentive plan to hit. The car fires didn't help of course. I think we'd be back into the 160s without those damn fires and NHTSA pending verdict.
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Tesla might be ready to do 40k, they are most likely and are eager to do so, but if their suppliers know they can't deliver, then what else can TM do but to guide to realistic numbers. That's what I'm trying to say that if this supply constraint issue isn't resolved in Q4 '13 like many assume, but instead in the second half of 2014, then we have a problem on our hands as the market will expect far more than TM can promise and the price will tank. It's just a risk we should be aware of and not get overly excited. I fully expect TM to be able to do in the years to come hundreds of thousands of cars per year, but in the short term they might be hitting a wall on supply side....
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sleepyhead said: ?

Elon already said a while back that the current line is designed for 40k units/year. He also said that they can expand to 50k units/year with very minimal capital expenditure of $25m - $50m.

Anything over $50m would probably require a lot more CAPEX and probably installing a completely new line.

For those who don't know Elon has said that batteries are now the ONLY constraint, that they worked everything else out with suppliers. It is only the batteries holding them up.
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yep. Agreed. Elon said batteries are the only constraint.
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FredTMC said: ?

yep. Agreed. Elon said batteries are the only constraint.
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I am not an expert in this field but isn't the gigafactory going to solve this issue?
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Raffy.Roma said: ?

I am not an expert in this field but isn't the gigafactory going to solve this issue?
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The giga-factory will be required for Gen III. The new Panasonic agreement for a minimum of 1.8 billion cells is designed to fully address Model S/X demand during the next four years.
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FredTMC said: ?

yep. Agreed. Elon said batteries are the only constraint.
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source?
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Bonken said: ?

source?
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Several sources now. Google is your friend.
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Oops, removed my post as I misinterpreted the OP's post.
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Bonken said: ?

source?
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This was in a note from Barclays within the last few days - a Barclays analyst had spoken with Elon or possibly another Tesla executive. I think sleepyhead reported on it, perhaps in the short-term thread.
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tentonine said: ?

This was in a note from Barclays within the last few days - a Barclays analyst had spoken with Elon or possibly another Tesla executive. I think sleepyhead reported on it, perhaps in the short-term thread.
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oh thats right, forgot about that, thanks!
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I have looked at the VIN's posted last time before the quarter end. Est. about 20,000 "VIN deliveries" reported. But the total amount delivered was about 18,200 through Q3. That means that 25% were on the boat or loaner cars. Looking at the current VINS, we look to be about 27,00 right now and 28,500 at end of quarter. Elon suggested that euro deliveries would continue to grow. So I would estimate 33% are going to be unaccounted VIN's (on boat etc.). That leaves us with 6,800 deliveries. That's my estimate.
NON-GAAP
107k ASP
26% GM
125 million capex
64 million in profit
EPS (138 million shares) $.46
This is above the usual 10% delivery beat.
I'd be happy with 6,600 deliveries, 35,000 outlook
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CLPrenz, you are saying that all Vin #s in the list have been built?

If the factory ran an average of 500 per week from January 1 with five holiday weeks off (one at start of each quarter plus Christmas) you will have 47 * 500 or 23,500 built this year by end of December and some 2700 built and 2650 sold in 2012. Given that, assume 26200 produced from Q4 12 to end of Q4 13. Sales so far this year are 15500 out of 23500 built so you have a possibility of from 6000 to 8000 sales in Q4 depending on pipeline loaded up to end Q3, which I believe is over 1000. Q4 also brings tax credit fulfilling sales in the USA and a subsidy-ending period in The Netherlands. Q1 may be lower in sales than Q4 unless new markets open up. UK opens in Q2 with the delivery of the right-handed drive models.

I'd say that 6200-6400 sales in Q4 are possible, 6000 probable. Anything more is mis-interpreting the Vin # assignment history and the extreme overage of Vin # assignment used during Q3 (for whatever reason - insert conspiracy theories here...)

Some EU buyers have Vin numbers from the summer period of excessive Vin assignment and their cars are still not built here in December. The primary concern of all investors is going to be reservation #s outstanding to end Q4, free cash flow, OpEx and CapEx and GAAP earnings. With the stated increase in R&D and CapEx, GAAP earnings will not be better than Q3 (IMO).

I wonder if they can really give such guidance of 35k for 2014. That is over a 50% YoY increase. It means it must magically go from 6K sales in Q4 to 7K or more in Q1 and steady increase through the year. To do that, the factory must move to a 3rd shift to increase production 50%. You can't take the existing shift workers and extend them but train up 50% more workers and usually if you have 500 workers, you need to train 300 more for a 3rd shift due to eventual attrition of all shifts. All suppliers must be on-board. The factor influencing increased production will be a demonstrable increase in reservations in regions that are small but growing. Let's say China rolls in 100/month reservations now but changes to 300/month in February and grows. I just don't know how investors can make proper decisions without knowing some of this data and working off simple one or two sentence statements from the factory. Other auto firms give far more detailed guidance and monthly sales numbers (and reservations are not an important part of their business).

To me, the stock price and all this forcasting is meaningless. The price of shares is whatever wall street tells us it should be and we just have to hold on for the ride. For example - who really believes that the "German Fax" caused the recent $20 increase in pps? The increase was immediate and sustained with a whole lot of 100-block trading in the mix by computer algorithm HST occurring. These are not retail investors but trading robots controlling the pps.
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FredTMC said: ?

yep. Agreed. Elon said batteries are the only constraint.
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Would it make sense to "highlight" selling more MS60 in order to do more vehicles without eating through the battery constraint? Maybe have gallery employees talk customers into considering those models over the 85? Also, how many batteries are going to SolarCity - or will those be Samsung or other vendors'? With SCTY CEO saying they want to try to install "all future" systems with battery standby, that is a lot of batteries going over to SCTY.

Getting more EVs on the road by selling MS60 is more in tune with the corporate declared statement of bringing affordable, sustainable transportation to consumers.
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bonaire said: ?

Would it make sense to "highlight" selling more MS60 in order to do more vehicles without eating through the battery constraint? Maybe have gallery employees talk customers into considering those models over the 85? Also, how many batteries are going to SolarCity - or will those be Samsung or other vendors'? With SCTY CEO saying they want to try to install "all future" systems with battery standby, that is a lot of batteries going over to SCTY.
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I think Tesla would rather have the higher margin higher end models and ship at a slower rampup than lower margin 60kWh models. About the SCTY battery supply Elon's stated on Twitter that the battery tech there is slightly different and no foreseeable constraint there (also shouldn't impact MS sales).
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bonaire said: ?

To do that, the factory must move to a 3rd shift to increase production 50%.
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Why? We know the line is capable of around 40K cars per year in two shifts. You seem to be assuming the production rate is limited because of line speed when in fact it may be due to supply issues. If Panasonic and other suppliers are able to ramp up production then the output could indeed jump without hiring more people.

As to selling more of the lower profit margin 60's, that doesn't make sense. Tesla generates more profit on a per cell basis in the 85kWh cars.
As Mario stated, the Solar City cells are different, they are 200 wh/kg density as opposed to the 250 wh/kg density used in the cars.
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JRP3 said: ?

Why? We know the line is capable of around 40K cars per year in two shifts. You seem to be assuming the production rate is limited because of line speed when in fact it may be due to supply issues. If Panasonic and other suppliers are able to ramp up production then the output could indeed jump without hiring more people.

As to selling more of the lower profit margin 60's, that doesn't make sense. Tesla generates more profit on a per cell basis in the 85kWh cars.
As Mario stated, the Solar City cells are different, they are 200 wh/kg density as opposed to the 250 wh/kg density used in the cars.
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Exactly my understanding. I believe that once margin was at 25% they would continue to seek to lower costs of the materials, time, etc. Then use that extra room to hire more workers, more inventory, etc. Both coming together to either keep margin at 25% or slowly grow it while rapidly expanding production. Their would be no absolute reason that they would need another shift. They would need another shift only at maybe Q2-Q3 next year when approaching 800-900 per week. Production ramp-up should be something that none of us can predict
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Clprenz said: ?

Exactly my understanding. I believe that once margin was at 25% they would continue to seek to lower costs of the materials, time, etc. Then use that extra room to hire more workers, more inventory, etc. Both coming together to either keep margin at 25% or slowly grow it while rapidly expanding production. Their would be no absolute reason that they would need another shift. They would need another shift only at maybe Q2-Q3 next year when approaching 800-900 per week. Production ramp-up should be something that none of us can predict
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Production of up 830 will NOT require addition of the third shift - it is "as designed" production capacity with two shifts, without any additional capEx. See my post linked below for the source:

http://www.teslamotorsclub.com/showthread.php/23892-Q4-2013-results-data-points-projections-and-expectations?p=518213&viewfull=1#post518213

The two shift production can be further increased to about 1040 cars/week with additional 25 to 50 capEx, as reported by sleepyhead: http://www.teslamotorsclub.com/showthread.php/23892-Q4-2013-results-data-points-projections-and-expectations?p=518371&viewfull=1#post518371

This thread has some good information, please read it before jumping to conclusions.
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vgrinshpun said: ?

This thread has some good information, please read it before jumping to conclusions.
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+10

getting so tired of ppl making statements like they are facts when the truth has been stated so many times before on this forum... wish we just had an automatic fact check function to make the FUD ppl ST*U... bonaire please stop saying things unless u are 100% sure that what you are saying is fact and true...
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For those of you who like to count VINs, I received the following email today from someone expecting delivery soon:

You own the Tesla Model S & X Reservations and Deliveries ZeeMap? I don't know how to change my entry. RN506106 to VIN P26874? Perhaps writing and asking you to do it is the only way?

Delivery ETA is this coming Thursday, 12/19/2013.
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For reference, my car (P01536) was delivered a little over a year ago, on 12/14/12.
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Trying to make an estimate for Q4 earnings. At the Q3 report, Elon guided that deliveries will be up about 10%. Later, we heard that deliveries are running above expectations, they'll probably be up 15%. On the other hand, he guided that operating expenses will be up 22%. Without trying to predict changes in ZEV credit sales, we can expect Q4 earnings to be quite a bit lower than Q3. But probably still in the black after non-GAAP adjustments.
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Here are the numbers for Q4 from The Netherlands (second European market behind Norway):

- October: 32 registrations
- November: 408 registrations
- December 578 registrations

Total for Q4: 1018 (total for the full year: 1195)

We can assume that a registration (license plate issued) almost equals a sale for Tesla. There are usually just a few days between the issueing of a plate and the delivery to the customer (which only happens after full payment to Tesla).

There was a big rush to get cars delivered before December 31st, because after that date the preferential fiscal treatment of EV is becoming a bit less preferential (although still much better than ICE's, so 2014 will also see strong sales).

It would be interesting for Q4-projections to hear the numbers from Norway.
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Right_Said_Fred said: ?

Here are the numbers for Q3 from The Netherlands (second European market behind Norway):

- October: 32 registrations
- November: 408 registrations
- December 578 registrations

Total for Q3: 1018 (total for the full year: 1195)

It would be interesting for Q3-projections to hear the numbers from Norway.
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Norway:

- October: 98
- November: 527
- December: Estimated around 600 (final number not ready yet, was 557 cars as of Dec.23rd)

Estimated year total: A little over 2000 cars (1983 as of Dec.23rd)
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So it's over 2k in Norway snd the Netherlands alone. Can anyone find rest of Europe? Especially Germany and Switzerland? I guess we know there is one in Estonia
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Glad to find this thread has woken up again. Looking forward to the q4 results discussion (not to mention the actual results announcement and 2014 estimates from Tesla).
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Norse said: ?

So it's over 2k in Norway snd the Netherlands alone. Can anyone find rest of Europe? Especially Germany and Switzerland? I guess we know there is one in Estonia
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2k is Norway alone. With the Netherlands it is over 3k and the rest of Europe probably between 4 and 5k.
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jkirkebo said: ?

2k is Norway alone. With the Netherlands it is over 3k and the rest of Europe probably between 4 and 5k.
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Is there some confusion between the full year 2013 and Q4-13 here?
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Yes, I was talking about Q4.
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Norse said: ?

Yes, I was talking about Q4.
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Ok, my fault :redface:
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jkirkebo said: ?

Ok, my fault :redface:
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I added to the confusion by talking about Q3, while the numbers were for Q4 ofcourse. Fixed that now.

Belgian registrations for December should be known in a few days time. October had 10 Model S registrations and November 43.
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Then I am guessing 2.4k for Europe in Q4.
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Norway December: 553 :smile:
http://www.elbil.no/elbiler/1186-7882-nye-elbiler-registrert-i-2013
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Wenche said: ?

Norway December: 553 :smile:
http://www.elbil.no/elbiler/1186-7882-nye-elbiler-registrert-i-2013
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Ok, so that brings us to 2196 in NL + NO. Any news from the rest of Europe? I would not expect numbers even close to these 2 countries, but I could be wrong. Switzerland should be interesting as I seem to rember seeing a lot of reservations from there. Germany should start to pick up by now now too, shouldn't it? Maybe 3k for Q4 Europe in total?
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mrdoubleb said: ?

Ok, so that brings us to 2196 in NL + NO. Anz news from the rest of Europe? I would not expect numbers even close to these 2 countries, but I could be wrong. Switzerland should be interesting as I seem to rember seeing a lot of reservations from there. Germany should start to pick up by now now too, shouldn't it? Maybe 3k for Q4 Europe in total?
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Germany, Belgium and Switzerland is the jokers, but you are not wrong. Peobably a bit under 3k total.
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Yeah well all I can contribute is Estonia 1 for sure I know of at least 2 Finnish deliveries (though Aland is a bit so-so for me, no clue if that'll register as finland) and there was this finnish dealership who had ordered 30 MS's and I think they'd sold 15-20 of them meaning about that many arrived. Would have to investigate if there are any decent statistics from their DMV. The Estonian DMV did give the numbers out yesterday and there was just my MS. I hope people from Sweden, Finland, Denmark etc can look at their DMV sites and check if there are statistics of new car registrations.
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I found the official number for Austria for Q4 on the German Tesla forums, it's 31, but Germany doesn't look so good. The latest numbers are from November, and Tesla is in the 700+ "other" category. Chatter in the forums shows the uptake is pretty slow in Germany - think low double digits per month.

Of course, we all know it's just a matter of "when" not "if" Tesla is successful there as well. While I understand Elon's reasoning for not wanting to spend money on marketing as long as they are production constrained, they have to raise awareness in the big EU countries. If numbers are bad in Germany, that could result in bad press and issues with their long term plans for delivering 10k to Europe. There is only so much luxury sedans Norway and the small but wealthy countries (NL, BE, DK, Switzerland) can take up...
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Mario Kadastik said: ?

Yeah well all I can contribute is Estonia 1 for sure I know of at least 2 Finnish deliveries (though Aland is a bit so-so for me, no clue if that'll register as finland) and there was this finnish dealership who had ordered 30 MS's and I think they'd sold 15-20 of them meaning about that many arrived. Would have to investigate if there are any decent statistics from their DMV. The Estonian DMV did give the numbers out yesterday and there was just my MS. I hope people from Sweden, Finland, Denmark etc can look at their DMV sites and check if there are statistics of new car registrations.
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Mario,

aren't there TWO Model S's in Estonia, yours and the red one that arrived together with yours?
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[email�protected] said: ?

Mario,

aren't there TWO Model S's in Estonia, yours and the red one that arrived together with yours?
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Red one was for Latvian owner?
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[email�protected] said: ?

Mario,

aren't there TWO Model S's in Estonia, yours and the red one that arrived together with yours?
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Nope, that did offload in Tallinn, but got transit numbers and is by now registered in Finland That's why I know there are at least 2 cars in Finland We should be able to add ~4-5 cars in Q1 2014 as at least that many are ordered and expected delivery in Q1.
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Welcome back DonPedro! Do you know when the norwegian price for the model S was fixed?
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mrdoubleb said: ?

Of course, we all know it's just a matter of "when" not "if" Tesla is successful there as well. While I understand Elon's reasoning for not wanting to spend money on marketing as long as they are production constrained, they have to raise awareness in the big EU countries. If numbers are bad in Germany, that could result in bad press and issues with their long term plans for delivering 10k to Europe. There is only so much luxury sedans Norway and the small but wealthy countries (NL, BE, DK, Switzerland) can take up...
Click to expand...

Traditional marketing - not going to happen, so you might as well stop thinking about it and they aren't going to press the awareness issue until they can actually build the cars to meet the demand. They've been quite clear about that. Right now Tesla's focus in Germany (and the rest of Europe) is to get the Super Charger Network up. From an American movie: 'build it and they will come.'
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Krugerrand said: ?

Traditional marketing - not going to happen, so you might as well stop thinking about it and they aren't going to press the awareness issue until they can actually build the cars to meet the demand. They've been quite clear about that. Right now Tesla's focus in Germany (and the rest of Europe) is to get the Super Charger Network up. From an American movie: 'build it and they will come.'
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Yeah... let's get back to this when the internet starts to get flooded with headlines on how abysmal German sales are...
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The sales numbers for Belgium
- 148 for the whole of 2013
- 10 in October
- 43 in November
- 39 in December
So 92 in total for Q4

source http://www.febiac.be/public/list_pressreleases.aspx?lang=NL
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2500 maximum then. Would be very surprised if it is higher.
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Krugerrand said: ?

Traditional marketing - not going to happen, so you might as well stop thinking about it and they aren't going to press the awareness issue until they can actually build the cars to meet the demand. They've been quite clear about that. Right now Tesla's focus in Germany (and the rest of Europe) is to get the Super Charger Network up. From an American movie: 'build it and they will come.'
Click to expand...

Anybody tried to drive 210 for 15 minutes and seen what it does to your range? Germany will be a major challenge for Tesla... If you take in consideration the "slightly" disappointing range, and combine this with the German highway possibilities when thinking what that will do to your range, the Tesla will have a serious challenge there. With my 5 series I was able to drive from venlo (Dutch border) to the Swiss border in 4,5 hours. With the Tesla that will take at least the double time (lower speed and three stops). High speeds eat up the range so damn fast, that they will need a supercharger every 150 km's. And then we are not even talking the loss of time. So raising the speed us not enough.... Germans will never drive 105 on right lane if they don't have too...
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pwillemse78 said: ?

Anybody tried to drive 210 for 15 minutes and seen what it does to your range? Germany will be a major challenge for Tesla... If you take in consideration the "slightly" disappointing range, and combine this with the German highway possibilities when thinking what that will do to your range, the Tesla will have a serious challenge there. With my 5 series I was able to drive from venlo (Dutch border) to the Swiss border in 4,5 hours. With the Tesla that will take at least the double time (lower speed and three stops). High speeds eat up the range so damn fast, that they will need a supercharger every 150 km's. And then we are not even talking the loss of time. So raising the speed us not enough.... Germans will never drive 105 on right lane if they don't have too...
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I agree, I do not get why Tesla belives Germany will be so hot until they have better range. But then again, maybe Tesla knows something we don't
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Does anyone have figures for the average trip length in Germany? I keep hearing how the S won't cut it on the autobahn, do Germans really do that much more long distance driving than everyone else, including Americans? In the US trips over 100 miles are less than 1% of all driving. http://www.greencarreports.com/news/1071688_95-of-all-trips-could-be-made-in-electric-cars-says-study
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JRP3 said: ?

Does anyone have figures for the average trip length in Germany? I keep hearing how the S won't cut it on the autobahn, do Germans really do that much more long distance driving than everyone else, including Americans? In the US trips over 100 miles are less than 1% of all driving. http://www.greencarreports.com/news/1071688_95-of-all-trips-could-be-made-in-electric-cars-says-study
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Exactly. And those who do buy Model S will have a backup ICE.
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Yes they do, especially work related trips can be 500 km's one way frequently. As you can drive up to 250 km/h on 45% of the highways, driving is faster then flying....
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I'd like to see some actual data.
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I do know that many German and Austrian businesses have subsidiaries in Eastern Europe. Their managers often drive to the country side in Hungary, Slovakia, etc. as you only have airports in the capitals of these countries so driving is often preferred.

But that is beside the point.

We are not talking about people actually needing 1000km range. It is psychology.

Anyway, having a weak Q4 in Germany might not be that big of an issue yet, but for long term success you can't write off the biggest economy in Europe or just hope that demand will magically pick up by itself. So Tesla needs to keep buliding that dense SC network, improve charge times, pack capacity and educate the public at the same time. Model S and X do the groundwork for mass success of E. By the time Gen3 hits the road, Tesla has to become a household name.

- - - Updated - - -

JRP3 said: ?

I'd like to see some actual data.
Click to expand...

http://www.motor-talk.de/news/nur-ein-prozent-faehrt-wirklich-viel-t4635782.html
The average German car does 14300km per year (2012 data). That's about 9000 miles.
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Thanks. Any breakdown of what percentage of trips are over 100 miles or so? I would guess not that many if 9K miles is average for a year.
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JRP3 said: ?

Thanks. Any breakdown of what percentage of trips are over 100 miles or so? I would guess not that many if 9K miles is average for a year.
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No, the text only explains the chart. It's more about annual figures. The only daily number they quote is 39km (24 miles) being the average daily drive - but that's probably just 14300km/365...
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Breakdown is not too relevant. You are averaging all cars, in stead of the potential s buyers. The people that would drive a ms are the people driving a 5 series, a6 or e-class merc, or more. They are used to drive longer distances at very high speeds. That simply is not possible with our car for more then 150 kilometers, especially in wintertime, especially of you add elevation which is there in the south. Last week an article of autobild came out showing range (on not even high speeds) of 207 km's in the south of Germany... Tesla will have to come up with something, lets hope it can be retrofittable
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sleepyhead said: ?

Exactly. And those who do buy Model S will have a backup ICE.
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Ok, a German here.

I slowed down my average speed a lot since I have the roadster. I select the travel speed depending on the range available. I have 30 mi one way to one of my offices, 255 mi to the other. I used the roadster for both, the long trip in only in the summer. Using an HPC for an hour or so half way it is easy. Not in the winter. The 30 mi trip to my other office poses no range problem. I seldom take the roadster to 110 mph, mostly cruising at 80-90. I have installed charging sockets at both my offices (3 phase 220 V 32 A).

I did the long trip in the model S without charging on the way. Superchargers were not yet available, otherwise I would have used one to top off. Average speed on the Autobahn was 68 mph (110 km/h). I look forward to going faster in the future with a 10 min top off at a SC.

The key in Germany is the SC network. It is being built quite nicely. Let Tesla add 10 more SCs and Germany will be pretty much covered. This and a few more deliveries will eventually get the Model S to the critical mass. I spend a lot of time on the Autobahn, but have not seen a Model S there yet (save my own).

I will be selling my backup ICE as soon as my new Model S arrives (expected in February). When I had the Model S in October 2013 I drove it for 2,500 mi; the ICE was just moved once during that month to keep the wheels from flattening. Driving a Tesla is just so much advanced and so much more fun. The kick isn't in the top speed. The MS does not handle well over 100 mph. I tried top speed once for about 15 minutes. Yes, it does use more electrons. It does get noisier. Tesla will improve the handling, as Elon promised in Munich. But the Tesla is not about driving high speed. For me it is the effortless way it drives. The responsiveness, the smoothness, the quiet, the horizontal dynamics etc. I enjoy every minute of it, so why go fast.

That reminds me of the Eurotunnel train. The operator spent Billions to speed up the travel time it takes from Paris to London. For a fraction of the sum they could have hired a bunch of go go girls that dance in the train - and the passengers would be asking the train too slow down to enjoy the show.

I understand that for some folks that have to drive a lot more than me, with a tight shedule, the MS is not the right car. But these are a small minority. For the others the Tesla is a revolution. So much better in so many ways. Not yet quite economical - but that will change in 2017.
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How many 530d's did you see cruising 110? For the moment many people will like it, me too, but I already notice hat when my range allows me, I go 150/160 to make it sooner...
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pwillemse78 said: ?

Breakdown is not too relevant. You are averaging all cars, in stead of the potential s buyers. The people that would drive a ms are the people driving a 5 series, a6 or e-class merc, or more.
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That's a valid point.

They are used to drive longer distances at very high speeds.
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That's an assumption, which may also be valid, but without data to support it. How often do they actually take trips that would be out of Model S range, and what percentage of those drivers take those trips frequently enough to make the Model S unsuitable? I doubt we'll get that data anywhere.
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JRP3 said: ?

That's a valid point.
That's an assumption, which may also be valid, but without data to support it. How often do they actually take trips that would be out of Model S range, and what percentage of those drivers take those trips frequently enough to make the Model S unsuitable? I doubt we'll get that data anywhere.
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You would probably be right. So? If they don't have bread, let them eat cake. Make do with anecdata, aka experience. These guys seem to have some to contribute. Take it.

(I'm a bit grumpy today.)
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Problem is I heard many of the same claims about US driving patterns, which turned out not to be true. I'm not rejecting what's been said, just looking for solid numbers to back it up if they are available.
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JRP3 said: ?

Problem is I heard many of the same claims about US driving patterns, which turned out not to be true. I'm not rejecting what's been said, just looking for solid numbers to back it up if they are available.
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And, at the risk of sounding like a broken record, my only issue with that approach is that you are looking at this way too rationally. It will take lots of "education" (marketing, reviews, awards, winning over gearhead journalists, etc.) before people's first reaction to range is "ok, but what about my vacation to Greece where I need to drive 1000km??").

Nevertheless, I think the SC network and new battery packs based on 4ah Pana cells will solve this issue sooner than we think.
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I'm not expecting 4ah cells any sooner than 2 years from now, but I hope you're right.
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JRP3 said: ?

Problem is I heard many of the same claims about US driving patterns, which turned out not to be true. I'm not rejecting what's been said, just looking for solid numbers to back it up if they are available.
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Plus, minor detail, you have maximum speed limits, at a for our reference very low high. On the major route to the south in Germany, there is no speed limit.... As said, just try max speed for 15 minutes and look at your range. That is what they will do. Go figure what that does to emotions.... You can being up any rational explanation like sir, you only do that 5 times a year according to averages... Guess we all know what will happen
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pwillemse78 said: ?

Plus, minor detail, you have maximum speed limits, at a for our reference very low high. On the major route to the south in Germany, there is no speed limit.... As said, just try max speed for 15 minutes and look at your range. That is what they will do. Go figure what that does to emotions.... You can being up any rational explanation like sir, you only do that 5 times a year according to averages... Guess we all know what will happen
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Well - it depends... I don't have a Diesel, granted but my ICE drops range considerably if I go beyond 130km/h.

I think they key lies in the following: If you are a guy who routinely drives more than 400km per day, don't buy the Model S (at least not now). If you drive less, and only occasionally go beyond the 400km, consider if the convenience of never having to visit a gas station ever again outweighs the inconvenience, to manage range occasionally.

Most people like big gas tanks and long range since it means long time between stopping at a gas station. If you never need to stop at a gas station ever again, you don't care about the size of your gas tank.

It's just like on my computer: I cared about battery life when batteries wouldn't last my working day. Now that they last all the time I need them, I couldn't care less how big they actually are.
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I agree, with one comment. In Germany, with the average higher speed and height differences, that limit is not 400 but 250 km's....
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mrdoubleb said: ?

I found the official number for Austria for Q4 on the German Tesla forums, it's 31, but Germany doesn't look so good. The latest numbers are from November, and Tesla is in the 700+ "other" category. Chatter in the forums shows the uptake is pretty slow in Germany - think low double digits per month. [...]
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After searching a bit, I found this article: http://www.green-motors.de/news/1311112015-elektro-zulassungen-okt-2013-bmw-fuehrt-vor-tela-und-smart It�s stating that there were an estimated 180 Model S registrations in Germany in October, just below the BMW i3 at 197. I think it is safe to say there were at least the same number in Nov and Dec, so I�d estimate 540 for Q4. (As Germany has somewhat less than 10 times the number of citizens as Austria, the per capita Model S registrations is actually better .

One thing to consider when judging Tesla�s progress in Germany is also that there are quite a few established German car brands, which makes comparison to Norway or the Netherlands hard. Also I think those countries have much better financial incentives than we do.
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hobbes said: ?

After searching a bit, I found this article: http://www.green-motors.de/news/1311112015-elektro-zulassungen-okt-2013-bmw-fuehrt-vor-tela-und-smart It�s stating that there were an estimated 180 Model S registrations in Germany in October, just below the BMW i3 at 197. I think it is safe to say there were at least the same number in Nov and Dec, so I�d estimate 540 for Q4. (As Germany has somewhat less than 10 times the number of citizens as Austria, the per capita Model S registrations is actually better .

One thing to consider when judging Tesla�s progress in Germany is also that there are quite a few established German car brands, which makes comparison to Norway or the Netherlands hard. Also I think those countries have much better financial incentives than we do.
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Thanks for the October numbers. My info was from the German Tesla Freunde forum, so it was more anecdotal and probably based on September. Unfortunatley I'm not sure we can make the assumption that November and December had similar numbers as that depends on a lot. Was October just a spike due to 3 years of pre-orders? What was Tesla's schedule on deliveries to Germany over other countries? Etc. We will need more datapoints before assuming a 200 car per month steady delivery to Germany. But I do hope you are right.

I also agree on the need for EV incentives and would add that bulding those Superchargers in Europe as fast as they can will help too.

Back to the numbers... considering the Tesla costs 2-3x the i3 and is probably the most expensive EV on that list the No. 2 spot is pretty impressive. That's actually 25% of the German EV market. The fact that the Citoren C-Zero sold well, zero in both September and October is pretty sad for EVs in general but well deserved for the lame attempts traditional car companies make.
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Non GAAP EPS: $.43 calling it
I'll figure out the GAAP tonight, most likely still negative
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Clprenz said: ?

Non GAAP EPS: $.43 calling it
I'll figure out the GAAP tonight, most likely still negative
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Just off the cuff, that seems a little high to me. Looking at the changes from last quarter, deliveries are up 25% and operating expenses were guided to be up 22%. Assuming ZEV credit sales are similar and no other wild cards pop up (like foreign exchange), then I would expect earnings to improve by about $10M. Any thoughts?
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Germany was mentioned above. With public electric prices there at .39-.40 per kWh, the use of free supercharging may be preferred by buyers. At home charging is about 2.5 miles per dollar (quite a bit less if driven on the Autobahn at high speed). I know it matters less for the wealthy but will matter more for ME buyers eventually.
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Why would ZEV credit sales be more like Q3 of 2013 than Q4 of 2012 or more likely Q1 of 2013. That's how ZEV works, the program runs on an October cycle and Q4 is a new year for ZEV, but with higher requirements for ICE manufacturers to meet based on more auto sales in California. With Tesla possessing the only gold-standard ZEV credits and carrying a number forward from last fiscal year, I would be very surprised if ZEV was lower than $70 million and non-GAAP less than $.70/share conservatively.

It it seems like everyone has forgotten about ZEV, it hasn't gone away.....where is Capitalist Oppressor when you need him? Someone light up the bat signal.
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Bgarret said: ?

Why would ZEV credit sales be more like Q3 of 2013 than Q4 of 2012 or more likely Q1 of 2013. That's how ZEV works, the program runs on an October cycle and Q4 is a new year for ZEV, but with higher requirements for ICE manufacturers to meet based on more auto sales in California. With Tesla possessing the only gold-standard ZEV credits and carrying a number forward from last fiscal year, I would be very surprised if ZEV was lower than $70 million and non-GAAP less than $.70/share conservatively.

It it seems like everyone has forgotten about ZEV, it hasn't gone away.....where is Capitalist Oppressor when you need him? Someone light up the bat signal.
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Do we even know what ZEV credits were back in Q4 2012? It seems like Tesla didn't want to say at the time from the earnings transcript but one would think that it was higher in Q4 than Q1. Anyway I think that would be very good for the stock. On the other hand, isn't it possible that more manufacturers have enough compliance cars now?
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Tesla received $160 million last year for credits produced from Oct 2012 to Sept 2013. They produced a total of 1311 credits during that timeframe, but only sold 1035 of them. That would equate to about $154,000.00 per credit sold. There are no other manufacturers with new ZEV credits, there are some that sell PZEV credits, but there is a hard requirement for ZEV credits that is increasing every year. Some manufacturers are hoarding the credits they have and Tesla is the only real seller in the market. If you don't meet your pure ZEV requirement, you can't sell cars in California. A couple of good articles:

Zero Emission Vehicle Credits

Tesla sells most ZEV green car credits, GM tops buyer list

By subtracting the 3 published quarters from $160 million, Tesla realized just over $40 million in ZEV revenue in Q4 2012.

The 276 credits they carried over from last ZEV year should have a rough street value of $42 million.

I am assuming they produced and delivered as many, if not more Model S's in California in Q4 2013 as in Q4 2012.....the question is: Did they sell all the credits? My guess is yes...the demand is still there, if not greater, and a big auto company would not want to wait for the last minute and pay an inflated price in September of 2014. Additionally, while we only have 1 year to go on, Tesla sold over $100 million in ZEV credits in Q4 2012 + Q1 2013.

These are the reasons I say $70 million is conservative.....$100 Million possible. Add that pure profit to the Revenue and you get a non-GAAP EPS north of $.75/share and an easily positive GAAP EPS.

those are my thoughts on ZEV and Q4 2013....cheers!
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Bgarret said: ?

Zero Emission Vehicle Credits
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When I look at this I see GM, Chrysler, and Honda at the top of the buyers. I just did a search and GM and Chrysler seem to have just started selling their compliance cars last June and Honda recently lowered the price of their FIT EV. To me that says they got their act together and won't be needing to buy ZEV credits anymore. Am I missing something here?

It is far cheaper to sell a car at a $20,000 loss than buy a $154,000 credit so they can basically lower the price as far as they need to in order to sell enough cars. Also, they have until the end of next September to do it. In all fairness it seems like Jaguar Land Rover, Subaru, and Volkswagen don't have their act together but they required <100 credits last year. It seems to me like that puts ZEV revenue for the entire new cycle at less than $15 million.

On the other hand we could have a surprise left over from September of last year if it was transferred at the last minute and didn't hit the books for Q3. Please prove me wrong as I'd love to see solidly positive GAAP earnings to give the bears one less thing to harp on.
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bonaire said: ?

Germany was mentioned above. With public electric prices there at .39-.40 per kWh, the use of free supercharging may be preferred by buyers. At home charging is about 2.5 miles per dollar (quite a bit less if driven on the Autobahn at high speed). I know it matters less for the wealthy but will matter more for ME buyers eventually.
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Yep, $100 per charge sounds about right . If you are going to constantly troll negatives about Tesla then at least put in a better effort to get simple math correct (not to mention that avg. price of electricity in Germany is lower than you claim, and those that have solar panels pay a lot less; and many do have panels on their roofs).

You are not adding any value or fooling anyone here with your constantly negative (or as you claim "realistic") posts on Tesla.

It is good to hear the negative side of the story, but when someone constantly looks for negatives in every Tesla related topic then that person's opinion becomes meaningless.
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sleepyhead said: ?

Yep, $100 per charge sounds about right . If you are going to constantly troll negatives about Tesla then at least put in a better effort to get simple math correct (not to mention that avg. price of electricity in Germany is lower than you claim, and those that have solar panels pay a lot less; and many do have panels on their roofs).

You are not adding any value or fooling anyone here with your constantly negative (or as you claim "realistic") posts on Tesla.

It is good to hear the negative side of the story, but when someone constantly looks for negatives in every Tesla related topic then that person's opinion becomes meaningless.
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Word. Go hang out with your buddy tftf on SA. He hung out here for a while claiming to be a "realist" also, but it's simply not possible to see only negative about tesla, yet you two both manage it. As Sleepy pointed out, this makes everything you say meaningless. There is a difference between wanting a company to succeed yet seeing the obstacles as many members here do, and wanting them to fail no matter what, like you. Why do you spend so much of your time wishing Tesla to fail?

That reminds me, there is a function to ignore posts from certain users correct? I've never wanted to use that on a forum before, but this may be the first.
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uselesslogin said: ?

When I look at this I see GM, Chrysler, and Honda at the top of the buyers. I just did a search and GM and Chrysler seem to have just started selling their compliance cars last June and Honda recently lowered the price of their FIT EV. To me that says they got their act together and won't be needing to buy ZEV credits anymore. Am I missing something here?

It is far cheaper to sell a car at a $20,000 loss than buy a $154,000 credit so they can basically lower the price as far as they need to in order to sell enough cars. Also, they have until the end of next September to do it. In all fairness it seems like Jaguar Land Rover, Subaru, and Volkswagen don't have their act together but they required <100 credits last year. It seems to me like that puts ZEV revenue for the entire new cycle at less than $15 million.

On the other hand we could have a surprise left over from September of last year if it was transferred at the last minute and didn't hit the books for Q3. Please prove me wrong as I'd love to see solidly positive GAAP earnings to give the bears one less thing to harp on.
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This is a good article that touches on compliance cars, sales and economics...RAV4 EV Owner Contemplates Future of the Car | PluginCars.com

they are trying to sell anything at a discount for just the reason you outline, but non-Tesla EVs just won't sell at the scale to meet the requirements...and those requirements increase fourfold in 2015, unless we have a redux of EV-1 and who killed the electric car and they suspend the regulation. I wouldn't just look at last year, but look at 2015. Even if GM, Chrysler and Honda are OK, which they are not, BMW, Ford and almost every automaker does not have and will not have the necessary ZEV credits and Tesla may not even have enough Model S & X production to meet the increased guidance for 2015.

If you have time, look up CapitalistOppressor's really detailed work on ZEV from last Spring/Summer. It will go in much greater detail about why without regulation change, which has not happened and I find unlikely, Tesla has an amazing recurring revenue stream that helped make them profitable in 2013 and will help them to about $3.30/share in 2014.

ZEV is what precipitated the first short squeeze, helped precipitate Teslas drop after Q3 earnings (add even $51 million to revenue and tell me that Q3 results are the same), and it seems to me have been forgotten in analyst estimates and even at TMC. It is one of many reasons I believe another tsunami is coming for shorts....but I could be sadly mistaken. Thanks for the questions and interest. Good luck.
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Bgarret said: ?

and those requirements increase fourfold in 2015
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Now you got me interested. Since more states signed on now I would think it would be harder to change the regulation too. I will go find CapitalistOppressor's posts when I get the chance.

Adding to my post I also see that the credits listed on that page are multiplied by an index "g/mi GMOG" so if Tesla gets 5 credits per car they are then multiplied by 0.043 so each credit as listed in these tables is equivalent to about 5 cars or so. That means they got more like $30,000 per car or more if they got 7 credits and less if only 4. Either way that is a much smaller number and one that seems much more sustainable to me. I was wondering why they only had 1,000 credits or so.
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sleepyhead said: ?

Yep, $100 per charge sounds about right . If you are going to constantly troll negatives about Tesla then at least put in a better effort to get simple math correct (not to mention that avg. price of electricity in Germany is lower than you claim, and those that have solar panels pay a lot less; and many do have panels on their roofs).

You are not adding any value or fooling anyone here with your constantly negative (or as you claim "realistic") posts on Tesla.

It is good to hear the negative side of the story, but when someone constantly looks for negatives in every Tesla related topic then that person's opinion becomes meaningless.
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Wikipedia, IEA and other sites post world electric prices. They are out there and range from .36-.40 for Germany. Let's agree Germany is roughly Hawaii pricing.

Kilowatt Hours Electricity Costs Around the World | The Energy Collective

I know I sound like someone who just joined the country club and say golf is stupid. The point is EV advocates cannot be entirely be blind to the headwinds in countries which do not have incentives. I am trying to understand the whole world landscape for the future of EVs and it will be challenging. For example, the highest carbon footprint in the US per household is in the midwest. Some interesting graphs here:

Zip Code and Carbon Emissions Examinations | The Energy Collective

There are three types of people, at least, on TMC. Tesla owners-reservation holders, EV advocates/fans and lastly Tesla stock players. I am in the last two of these. I have made enough trading to pay for a Tesla but am compounding gains rather than spending it on a car. I do expect to own a Tesla at some point, perhaps a used one. I need far more superchargers on my area of the map before it is viable for me. The EV marketplace is very immature now and i see it when I go to the shopping malls and stores. All I see are SUVs, pickups, mini vans and people trying to maintain a semblance of normality as they continue to face higher prices of goods and services. They care more about the type of micro-brew they are buying today than concerns for world CO2 levels tomorrow. The fuel prices in Europe are what I think will drive the growth of EVs there and I believe the model-E will do well there once it is built.

One problem we need to fix in the USA is to switch from a tax credit for EVs and make it a rebate so that all income classes can benefit from them. Other country's incentive programs seem to be across all income classes. Canada's is quite good and Quebec just re-raised their rebate to $8000 and increased charging equipment rebate to $1000. Time for another gallery presence in Quebec.
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@bonaire

And in Germany a gallon of diesel is $6.94. A gallon of premium gasoline is $8.

There are EV incentives in Germany because there are petroleum disincentives.
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bonaire said: ?

Germany was mentioned above. With public electric prices there at .39-.40 per kWh, the use of free supercharging may be preferred by buyers. At home charging is about 2.5 miles per dollar (quite a bit less if driven on the Autobahn at high speed). I know it matters less for the wealthy but will matter more for ME buyers eventually.
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My math was really wrong here.

.40/kWh is not 2.5 miles per dollar but rather 8 miles per dollar. Sorry about that. Wasn't trolling.

in hydro-rich northwest and perhaps Ontario, with .06-.08/kWh it is more like 30 miles per dollar. Germany still can be up to three times as expensive as these other locations.

90kWh (from wall, at home) range recharge at .40 = $36 and compared to $8 gallon premium or $7 diesel in a 20-30 mpg car, electric is a better deal by more than 2x. Public supercharging will benefit further since it is free.
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bonaire said: ?

90kWh (from wall, at home) range recharge at .40 = $36 and compared to $8 gallon premium or $7 diesel in a 20-30 mpg car, electric is a better deal by more than 2x. Public supercharging will benefit further since it is free.
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I wouldn't think of it as a factor. What matters is the differential.
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So, let's get this math done right in one post:

Model S:
Price of power in Germany = US$0.35/kWh = �0.26/kWh
Wh/mile = 300; Wh/km = 186
�/100 km = �4.84

Audi S7:
Price petrol in Germany = �1.50/liter
Fuel consumption: 9.6 l/100-km
�/100 km = �14.40

So in Germany the Model S fuel cost is about 1/3 of the fuel cost of the closest competitor (taking as given the manufacturers' mileage ratings; YMMV).

Having said that, the Model S 85P seems to cost about �18,000 more than a similarly equipped Audi S7. Assuming stable petrol and power prices, that purchase gap requires about 200,000 km of driving before the operating cost savings overtakes the capital cost.

In any case, I don't see the operating cost of the Model S as being a hinderance to its adoption in the EU; quite the opposite, the operating cost is a plus that offsets, in part, the purchase premium. Moreover, EU countries will provide some subsidies to EVs to improve balance-of-trade issues: the EU imports nearly all its petroleum, but it can produce much of its own electricity needs.
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Bonaire, your also discounting the fact that it's not just about the $ to people. I will be buying a Tesla, which is significantly more than I would pay for any ice vehicle, because it's something I believe in. This is the one fact that shorts completely ignore because they can't punch it into their calculator. It's a paradigm shift and it's happening now.
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Bgarret said: ?

ZEV is what precipitated the first short squeeze, helped precipitate Teslas drop after Q3 earnings (add even $51 million to revenue and tell me that Q3 results are the same), and it seems to me have been forgotten in analyst estimates and even at TMC. It is one of many reasons I believe another tsunami is coming for shorts....but I could be sadly mistaken. Thanks for the questions and interest. Good luck.
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Do you have any info on why ZEV credits are traded more heavily in certain quarters than others? More specifically, do you have any info that Q4 was a quarter that Tesla was able to sell a lot of ZEV credits?
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Robert.Boston said: ?

Wh/mile = 300
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That's too generous, especially for high speed in Germany, not to mention charging and cold weather losses.

Closer to 400 would be my number.
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We're actually seeing 180-230 Wh/km in current weather here in Germany. When Autobahn driving is involved (120km/h and more), consumption ranges between 250 and 270Wh/km were reported.

That's between 290 and 370Wh/mi driving, 400 to 430 Wh/mi @Autobahn.
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I think the point was that this comparison was based on rated usage. I think if you drive the Audi or BMW at autobahn speeds you're also not consuming the placard l/100km but far more wether the two usages (Model S and Audi fuel consumption) correlate 100% or not is hard to guess. But otherwise you should just make a coefficient of inefficiency for both in which case it's equivalent to driving more effective km reaching the parity faster.
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hobbes said: ?

After searching a bit, I found this article: http://www.green-motors.de/news/1311112015-elektro-zulassungen-okt-2013-bmw-fuehrt-vor-tela-und-smart It�s stating that there were an estimated 180 Model S registrations in Germany in October, just below the BMW i3 at 197. I think it is safe to say there were at least the same number in Nov and Dec, so I�d estimate 540 for Q4. (As Germany has somewhat less than 10 times the number of citizens as Austria, the per capita Model S registrations is actually better .

One thing to consider when judging Tesla�s progress in Germany is also that there are quite a few established German car brands, which makes comparison to Norway or the Netherlands hard. Also I think those countries have much better financial incentives than we do.
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There have been delivered 135 Model S in Germany in the 4th quarter according to this posting in the german Tesla-Board: Tesla-Fahrer und -Freunde Forum Thema anzeigen - Zulassungszahlen (KBA) für 2013
Needless to say that user Volker.Berlin is legit (he is a Model S-owner and a mod of that board) and the numbers are consistent with other data points.
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^This.

Don't forget guys, that when you see those official mpg or l/100km figures for ICEs, that's the Disney version. My dad has a Cayenne, and the only thing scarier than the highway fuel consumption is the amount of engine oil it burns. Up to 0.7-1l per 1000km!!! And Porsche says .5-.7 is normal(!).
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DaveT said: ?

Do you have any info on why ZEV credits are traded more heavily in certain quarters than others? More specifically, do you have any info that Q4 was a quarter that Tesla was able to sell a lot of ZEV credits?
Click to expand...

Dave,

Thanks for the question, and the short answer is no, I can't predict ZEV sales by quarters. The long answer is a combination of resources and inferences let me sum these up as quickly as possible.

If you haven't read Capitalist Oppressor's opus on ZEV, it's worth it: Regulatory Credits - How BMW and Daimler Will Fund Tesla's Conquest of the World

I particularly like this summary as an initial answer to your question:

"Nothing prevents an automaker from purchasing Tesla credits and banking them for future use. And there is no requirement that Tesla sell any of its credits right now. So the actual pace of sales is not necessarily driven by current needs, but rather by an attempt by both sides to maximize utility."

So a couple bullet points about Q4 and why I think this will be a good quarter for ZEV:

- Q4 2012 and Q1 2013 were good last year....while this is a small data set, the ZEV revenue looked to be 100% of ZEV credits produced for Q4 2012, Q1 2013 and Q2 2013, then the large drop from $51 million to $10 million that coincided with the changeover of the program year on September 30, 2013.

- There is a reporting requirement on May 1st. Once again from Cap Opp's Opus, "On balance, I think its likely that speculation about Q1 revenue from regulatory credits has substantially understated the potential, especially since $5,000/credit looks to be a minimum, and manufacturers had an incentive to get to a positive balance before the May 1st reporting deadline. This is very much a sellers market."

- 2013 was a catch up year, 2014 is the rump/pay it forward year. For Q4 2012 and Q1 2013 the automakers needed to catch up for cars produced in 2012 as there were very few ZEV credits on the market because Tesla just started to produce cars. For 2014, this is the last year that only .79% of sales need to be pure EV...in 2015, 3% of sales need to be ZEV. The market is about to almost quadruple at about the time the Model X is coming on line and there are very few compliance cars selling to meet the requirement.

- Increasing auto sales. In addition to the % of sales that have to be ZEV, the overall # of sales increased by over 10% last year in California, so the market for ZEV is at least 10% greater.

I don't know if TESLA will sell all their credits in Q4, but I am intrigued by the beating they took in Q3 with a pretty good report and low ZEV and if they would want to turn that part of the story around. I also think with the announcement of the giga-battery factory, they will want to show how they will pay for this new investment and revenue over $100 million for a quarter would help. I also rely some on Elon's comments from last year (and look forward to his comments this earnings call about ZEV). Tesla and Elon have the best read on the market as they are the market maker - he not only nailed last year's trend, but telegraphed it. I don't know if that means no ZEV for Q4 or massive ZEV for Q4...I'm leaning toward the latter.

Hope this helps, let me know what you think.
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Bgarret said: ?

I also rely some on Elon's comments from last year (and look forward to his comments this earnings call about ZEV). Tesla and Elon have the best read on the market as they are the market maker - he not only nailed last year's trend, but telegraphed it. I don't know if that means no ZEV for Q4 or massive ZEV for Q4...I'm leaning toward the latter.
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Hi Bgarret, thanks for taking time to share your thoughts.

In Q1 2013 ER (Tesla Motors Inc (TSLA): Tesla Motors' CEO Discusses Q1 2013 Results - Earnings Call Transcript - Seeking Alpha): (bold face is my emphasis)

Ben Schuman - Pacific Crest Securities - I guess my first question is around the ZEV credits, you disclose the amount of revenue in Q1, can you say how much is implied in the Q2 gross margin guidance and kind of its part of that what are some of the big gross margin drivers to get from that 5% level now, excluding the ZEV revenue to 25% and do you expect that 25% of those without whatever positive impact from the lease accounting that you might see?
Elon Musk - Chairman, CEO, and Product Architect - Okay. There is like few questions in there. Yeah, so we�re expecting a decline in the credit revenue for Q2 and then probably fairly significant decline in Q3 and as I said back right now, we�re not expecting anything in Q4. That�s our � I mean, it might be some ZEV credit revenue in Q4, but we�re not accounting on it. I don�t have � I can�t give anymore precision than that at this time.

[later on in conference call]

Patrick Archambault - Goldman Sachs
That�s helpful. If I can just squeeze one more, if that�s okay, just � I know your guidance for the 25% doesn�t include ZEV credits for the fourth quarter, but I don�t know � can you help us just bracket that possibility that there might be some, are you in talks with, I mean, clearly you have the volume to have further ZEV credit, so obviously are you in talks with other manufacturers for these kinds of credits? I mean is there any kind of feeling of probability that you can give us that would allow us to sort of handicap that?
Elon Musk - Chairman, CEO, and Product Architect
I mean, I think we�re � I would realistically handicap it at zero for the fourth quarter �
Patrick Archambault - Goldman Sachs
Okay.
Elon Musk - Chairman, CEO, and Product Architect
� which is not, I mean, we will sell them if we can, but as we really anticipate saturating demand for ZEV credits, probably in the third quarter. So maybe that�s not true, but I wouldn�t � for purposes of modeling our financials, I�d recommend assuming zero percent credits in Q4.

It appears pretty clear that Elon is telling investors to expect zero or close to zero ZEV credit income for Q4.

I'm still open to seeing evidence that Tesla has significant Q4 ZEV income but until then it's probably wise to heed Elon's advice.

Does anybody know how much ZEV income Tesla had in Q3 2012?
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Does anybody know how much ZEV income Tesla had in Q3 2012?
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From Q3 2012 10-Q

Other Assets
As of September 30, 2012 and December 31, 2011, our other assets consisted of the following (in thousands):
[TR="bgcolor: #CCEEFF"][/TR]

September 30,
2012

December 31,
2011

Emission credits
$ 14,392

$ 14,508
Go in here and search on either "emissions" or "ZEV" : EDGAR Pro - TSLA Q3 '12
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DaveT said: ?

Does anybody know how much ZEV income Tesla had in Q3 2012?
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Good question, I've been trying to find the answer as well. Here's what I found so far, only info about the number of credits but not how much $$

For the period between Oct 1, 2011 and Sept 30, 2012: 31.605 ZEV credits, with a balance of 0 ZEV credits remaining.

For the period between Oct 1, 2012 and Sept 30, 2013: 1311.520 ZEV credits, with a balance of 276.08 ZEV credits remaining.

So, at the end of Q3 '13, Tesla still had a bunch of ZEV credits in their account. I can't find the data on ZEV credit prices, though.

- - - Updated - - -

bonaire said: ?

From Q3 2012 10-Q

Other Assets
As of September 30, 2012 and December 31, 2011, our other assets consisted of the following (in thousands):
[TR="bgcolor: #CCEEFF"][/TR]

September 30,
2012

December 31,
2011

Emission credits
$ 14,392

$ 14,508
Go in here and search on either "emissions" or "ZEV" : EDGAR Pro - TSLA Q3 '12
Click to expand...

Well, according to ARB their ZEV credit balance as of Sept 30, 2012 would have been 0, so I don't know how they would have had ~$15 million in ZEV credit assets

EDIT: They could be referring to credits other than ZEV... I'm not very familiar with these so if anyone knows of other emission credits, I'd be interested to know.
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VolkerP said: ?

We're actually seeing 180-230 Wh/km in current weather here in Germany. When Autobahn driving is involved (120km/h and more), consumption ranges between 250 and 270Wh/km were reported.

That's between 290 and 370Wh/mi driving, 400 to 430 Wh/mi @Autobahn.
Click to expand...

Don't forget charging losses and vampire drain.
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teslamotorclub

Thứ Bảy, 24 tháng 12, 2016

Q4 2013 results - data points, projections and expectations part 1

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	September 30, 2012		December 31, 2011
Emission credits	$	14,392		$	14,508