TSLA - Tesla Motors Inc (NASDAQ)

[mullokintyre]

From electek

Tesla has updated its pricing for the Model 3 and Model Y, raising the prices of the long-range versions by $1,000.

It comes as nickel prices are surging.

In 2021, Tesla made so many price increases that we have lost count.

The automaker blamed the increases on being under pressure from supply chain constraints following the COVID-19 pandemic, but it is also fair to note that Tesla’s gross margins went up throughout the year.

Things have calmed down on that front over the last few months with Tesla’s last price increase in November.

But now Tesla is back with a new update to the Model 3 and Model Y configurations, and it is again an increase in price.

The price of the Model 3 Long Range increases by $1,000 from $50,990 to $51,990:

I can't imagine all the other EV manufacturers are immune from the inflationary aspects of raw materials increases.
Mick

 

[JohnDe]

From electek

In 2021, Tesla made so many price increases that we have lost count.

I can't imagine all the other EV manufacturers are immune from the inflationary aspects of raw materials increases.
Mick

That's strange, I remember a price reduction last year because I just missed it -

July 12 2021: Tesla has once again dropped the price of its most popular model Down Under – the Model 3's entry-level variant coming in at $59,900 before on-road costs.​

​

The carmaker has cut the asking price significantly since the model arrived in Australia back in 2019, when its recommended retail price (RRP) was $66,000.​

​

In addition to the Standard Range Plus, the mid-level and range-topping Long Range and Performance variants have also had their costs slashed, now priced at $73,400 and $84,900 respectively.​

​

With the model now on offer at an all time low, both the Standard Range Plus and Long Range fall beneath the current Luxury Car Tax threshold of $79,659, and the Standard Range Plus is also made more affordable with various electric vehicle subsidies and incentives offered by several Australian states.​

​

Tesla Model 3 price cut again – UPDATE

The cost of Tesla’s most popular model has reduced again

www.whichcar.com.au

 

[mullokintyre]

That's strange, I remember a price reduction last year because I just missed it -

July 12 2021: Tesla has once again dropped the price of its most popular model Down Under – the Model 3's entry-level variant coming in at $59,900 before on-road costs.​

​

The carmaker has cut the asking price significantly since the model arrived in Australia back in 2019, when its recommended retail price (RRP) was $66,000.​

​

In addition to the Standard Range Plus, the mid-level and range-topping Long Range and Performance variants have also had their costs slashed, now priced at $73,400 and $84,900 respectively.​

​

With the model now on offer at an all time low, both the Standard Range Plus and Long Range fall beneath the current Luxury Car Tax threshold of $79,659, and the Standard Range Plus is also made more affordable with various electric vehicle subsidies and incentives offered by several Australian states.​

​

Tesla Model 3 price cut again – UPDATE

The cost of Tesla’s most popular model has reduced again

www.whichcar.com.au

Tesla reduced their prices in OZ allright, (I think from memory the model 3 dropped by 4k), but this article is talkling about America.
In the US, there were a number of price rises.
Indeed, there was some suggestions that US buyers were subsidising Teslas overseas growth.
From Autoblog

Tesla raised the price of its two most affordable models in what is being described as a quiet overnight website update. The Model 3's base price is now $44,690 (including $1,200 for destination) and the Model Y now starts at $56,190 – an increase of roughly $2,000 for the Model 3 and $1,000 for the Model Y. Higher-trim variants of both models saw their prices raised by $1,000 as well.

The Model 3 Long Range model was immune from the adjustment; it still starts at $52,690. The Performance ticked up a grand, now starting at $59,190. The Model Y Performance (there's nothing beneath its Long Range variant, unlike the cheaper Model 3) now starts at $63,190.

And this is far from the first time Tesla has raised prices on its U.S. models in 2021. In fact, since Elon infamously announced that the Model S base price would drop to $69,420 late last year, and allowed the base Model 3 and Y prices to drop into the upper $30,000 range, the company has been incrementally raising MSRPs across its U.S. lineup. The price hikes have even prompted some analysts to speculate that Tesla is effectively subsidizing cheaper models overseas by hiking prices here at home.

While cost, parts availability and labor issues have likely impacted Tesla much the same way they have the rest of the auto industry, that alone cannot explain the steady drum beat of price increases. In all likelihood, Tesla expects the Biden administration to continue its push for expanded electric vehicle subsidies, which would take some of the pricing burden off of the company itself.

While there are subsides, encouragements etc from Governments, market distortions inevitably occur.
Mick

 

[JohnDe]

Tesla reduced their prices in OZ allright, (I think from memory the model 3 dropped by 4k), but this article is talkling about America.
In the US, there were a number of price rises.
Indeed, there was some suggestions that US buyers were subsidising Teslas overseas growth.
From Autoblog


Whole there are subsides, encouragements etc from Governments, market distortions inevitably occur.
Mick

US Tesla pricing was cheapest in the world, price increases brought them closer to world parity. If you look at Tesla pricing for spares, accessories, upgrades and extras are priced in similarly across the globe, once you take into account exchange rates.

 

[mullokintyre]

US Tesla pricing was cheapest in the world, price increases brought them closer to world parity. If you look at Tesla pricing for spares, accessories, upgrades and extras are priced in similarly across the globe, once you take into account exchange rates.

Look mate, you obviously are a big fan of Tesla, but if you read the original article at all, it quoted Tesla as saying that the pice increases were due to inflationary pressures , particularly Nickel. There was no mention of bringing them up to price parity, whatever that level is.
I would have thought that most people would be able to draw the conclusion that these inflationary pressures will be applicable to all cars, made or exported, in all countries.
If you read my comment at the end of that article, I said these same inflationary pressures will apply to all vehicles, regardless of make or origin.
Mick

 

[JohnDe]

US Tesla pricing was cheapest in the world, price increases brought them closer to world parity. If you look at Tesla pricing for spares, accessories, upgrades and extras are priced in similarly across the globe, once you take into account exchange rates.

Look mate, you obviously are a big fan of Tesla, but if you read the original article at all, it quoted Tesla as saying that the pice increases were due to inflationary pressures , particularly Nickel. There was no mention of bringing them up to price parity, whatever that level is.
I would have thought that most people would be able to draw the conclusion that these inflationary pressures will be applicable to all cars, made or exported, in all countries.
If you read my comment at the end of that article, I said these same inflationary pressures will apply to all vehicles, regardless of make or origin.
Mick

"it quoted Tesla as saying that the price increases were due to inflationary pressures , particularly Nickel." I'm sorry but I can not see where the article quotes Tesla, maybe my eyes and brain are suffering from a full weeks work load. Could you pin point it for me please?

I have no doubt that inflationary pressure will have some affects on Tesla pricing, but my mention of Tesla price parity is something that has been slowly going on for over a year.

Tesla profit margin on each vehicle sold is much larger than the traditional vehicle manufacturers, giving Tesla more leeway with pricing. Supply is the problem, with some markets having a 6+ month waiting list.

 

[mullokintyre]

"it quoted Tesla as saying that the price increases were due to inflationary pressures , particularly Nickel." I'm sorry but I can not see where the article quotes Tesla, maybe my eyes and brain are suffering from a full weeks work load. Could you pin point it for me please?

My apologies, although the article did mention that Tesla said the price was due to supply constraints, the article did not quote Tesla when it talked about Nickel as being one of the supply constraints.

Tesla profit margin on each vehicle sold is much larger than the traditional vehicle manufacturers,

Do you have any financial stats to back that up?
According to mint

The Model 3 sedans Tesla sells in China have higher profit margins than its vehicles in the U.S. and Europe, and China could make up more than 40% of Tesla’s sales by early 2022, Wedbush Securities analyst Dan Ives said in a Dec. 21 research note. That compares with about 20% now.

The low end model 3 will also have the lowest margins.
Big margins will only be made on the top level accessory filled vehicles.
Its no secret that all vehicle makers are moving production to the high end of all their models for just that reason.
Mick

 

[JohnDe]

Do you have any financial stats to back that up?
According to mint


Mick

The financials came out a few months ago, they seemed healthy to me. Here's a short breakdown from an industry follower -

Tesla reported blockbuster quarterly and annual earnings last week, notching its single largest net profit number of US$2.32 billion for Q4 and US$5.5 billion annual profit on $53.8 billion of revenue for 2021. That's a bit over 10% net income for the year, but the actual margin on building electric vehicles is much higher. Tucked in the latest Tesla earnings report is the tidbit that its cost of goods sold (COGS) directly attributable to the production of an electric vehicle in the second half of 2021 was US$36,000. That's how much the average Tesla car costs in parts and assembly. Needless to say, a Model S Plaid or Model Y will cost more to build than the humble Model 3 that starts from a US$45,000 MSRP, but the reported gross margin on all vehicles across Tesla's portfolio is very healthy, tipped the electric carmaker's CFO:​

​

"For Q4, specifically, automotive gross margin, excluding credits, increased to 29.2%, which is our highest yet. We do expect to continue to see stronger operating margins as we grow our volumes and improve operating leverage. Over a longer term horizon, we are quite optimistic about the expansion of margins. From the hardware side, we are aggressively driving manufacturing innovations and operational efficiency to reduce cost."​

​

Nearly 30% gross profit margin from your immediate operations and the potential for further increases should be music to the ears of any Tesla investor. Granted, it's not Apple's 42% gross margin, but it's still a significant achievement for a company making electric cars that many others are now striving to do profitably. As per Tesla's Q4 report:​

​

"While EVs were often deemed structurally unprofitable due to expensive batteries, we were convinced that manufacturing innovation, purpose-built vehicles and factories would solve cost concerns. In Q3-2021 (the last widely reported quarter), Tesla achieved the highest operating margin across all volume OEMs. Cost (COGS) per vehicle dropped to ~$36,000 in both Q3 and Q4 2021. We believe our current projects, including large castings, structural battery pack, 4680 cells and many others, should help us continue to minimize our product cost."​

Tesla reveals how much a Model Y or Model 3 cost to make, reports envious profit margins

Tesla's gross profit margin is one of the highest in the industry, it turns out, as it costs Tesla just US$36,000 on average to build one of its electric vehicles. A healthy 29% profit margin is something many carmakers can only dream of, yet Tesla is determined to bring production costs even...

www.notebookcheck.net

 

[mullokintyre]

The financials came out a few months ago, they seemed healthy to me. Here's a short breakdown from an industry follower -

Tesla reported blockbuster quarterly and annual earnings last week, notching its single largest net profit number of US$2.32 billion for Q4 and US$5.5 billion annual profit on $53.8 billion of revenue for 2021. That's a bit over 10% net income for the year, but the actual margin on building electric vehicles is much higher. Tucked in the latest Tesla earnings report is the tidbit that its cost of goods sold (COGS) directly attributable to the production of an electric vehicle in the second half of 2021 was US$36,000. That's how much the average Tesla car costs in parts and assembly. Needless to say, a Model S Plaid or Model Y will cost more to build than the humble Model 3 that starts from a US$45,000 MSRP, but the reported gross margin on all vehicles across Tesla's portfolio is very healthy, tipped the electric carmaker's CFO:​

​

"For Q4, specifically, automotive gross margin, excluding credits, increased to 29.2%, which is our highest yet. We do expect to continue to see stronger operating margins as we grow our volumes and improve operating leverage. Over a longer term horizon, we are quite optimistic about the expansion of margins. From the hardware side, we are aggressively driving manufacturing innovations and operational efficiency to reduce cost."​

​

Nearly 30% gross profit margin from your immediate operations and the potential for further increases should be music to the ears of any Tesla investor. Granted, it's not Apple's 42% gross margin, but it's still a significant achievement for a company making electric cars that many others are now striving to do profitably. As per Tesla's Q4 report:​

​

"While EVs were often deemed structurally unprofitable due to expensive batteries, we were convinced that manufacturing innovation, purpose-built vehicles and factories would solve cost concerns. In Q3-2021 (the last widely reported quarter), Tesla achieved the highest operating margin across all volume OEMs. Cost (COGS) per vehicle dropped to ~$36,000 in both Q3 and Q4 2021. We believe our current projects, including large castings, structural battery pack, 4680 cells and many others, should help us continue to minimize our product cost."​

Tesla reveals how much a Model Y or Model 3 cost to make, reports envious profit margins

Tesla's gross profit margin is one of the highest in the industry, it turns out, as it costs Tesla just US$36,000 on average to build one of its electric vehicles. A healthy 29% profit margin is something many carmakers can only dream of, yet Tesla is determined to bring production costs even...

www.notebookcheck.net

I suppose we could take Teslas word for it, but my scepticism of reports produced in house makes me want to wait until the financials for the year come out.
Mick

 

[JohnDe]

I suppose we could take Teslas word for it, but my scepticism of reports produced in house makes me want to wait until the financials for the year come out.
Mick

https://www.nasdaq.com/market-activity/stocks/tsla/financials

 

[mullokintyre]

No

https://www.nasdaq.com/market-activity/stocks/tsla/financials

Not quite detailed enough to see what their margins are.
They get a goodly amount of income from selling carbon credits, and there is no breakdown of revenue in the link from NASDAQ.
From The Driven this article refers to the last quarter of 2020, but it was the latest I could find.
The article suggests that it is becoming less of a percentage over time, but its still hard to find what the current figures are.

Last quarter alone Tesla sold more than $US500 million worth of credits, meaning they accounted for more than 5 per cent of total revenue of $US9 billion. In recent months that has made the difference between a net profit and a net loss for the company, though it has also become a smaller and smaller percentage of total revenue as its own car sales soar.

Mick

 

[JohnDe]

No

Not quite detailed enough to see what their margins are.
They get a goodly amount of income from selling carbon credits, and there is no breakdown of revenue in the link from NASDAQ.
From The Driven this article refers to the last quarter of 2020, but it was the latest I could find.
The article suggests that it is becoming less of a percentage over time, but its still hard to find what the current figures are.

Mick

carbon credits are minimal now. Look closer, you need to go through all four tabs.

to help you out I’ve dug out the financial report that Tesla released at the end of January, which has been reported and praised by many financial experts -

Tesla Investor Relations

Tesla's mission is to accelerate the world's transition to sustainable energy. Today, Tesla builds not only all-electric vehicles but also infinitely scalable clean energy generation and storage products.

ir.tesla.com

 

[mullokintyre]

carbon credits are minimal now. Look closer, you need to go through all four tabs.

to help you out I’ve dug out the financial report that Tesla released at the end of January, which has been reported and praised by many financial experts -

Tesla Investor Relations

Tesla's mission is to accelerate the world's transition to sustainable energy. Today, Tesla builds not only all-electric vehicles but also infinitely scalable clean energy generation and storage products.

ir.tesla.com

The four tabs in the link you provided I presume are those blue ones headed as below

I went through them all, they are at a macro level, does not provide any breakdown of income, it shows Gross income, but nowhere could I see the breakdown of what constituted that income.
I read the very first press release noticed that the fourth quarter production and deliveries report had the following

It would seem that the vast majority of the vehicles are model 3 and Y.
I don't know why they did not break down these figures into the various models, and then it would be obvious as to how many of the highly
profitable heavily optioned top end models it sold.
I wonder how many of those 936,00 deliveries for the year were the bottom end model 3 versus the top end model s Plaid?
The financial report shows the carbon credits at about 3% of Gross revenue, so it is not material.
But it does not provide any breakdowns by model, which makes it difficult to work out how profitable each one is.
It does make good reading though, when any company is improving its financials at that rate, it is deffinitely heading in the right direction.
Mick

 

[JohnDe]

Tesla says it is trying to keep production going at Shanghai factory
By Reuters Staff

SHANGHAI, March 17 (Reuters) - Tesla said on Thursday it was doing its best to keep production going at its Shanghai factory while it cooperates with China’s COVID-19 prevention measures.

Reuters reported on Wednesday that the U.S. electric vehicle maker had suspended production at its Shanghai factory for two days, according to a notice sent internally and to suppliers, as China tightens measures to curb the country’s latest outbreak.

“We are actively cooperating with the government’s requirements for nucleic acid testing and other epidemic prevention requirements, and at the same time are doing our best to ensure production, overcoming difficulties together,” the company said in a statement sent to Reuters. (Reporting by Brenda Goh and Zhang Yan; Editing by Jacqueline Wong)

Tesla says it is trying to keep production going at Shanghai factory

Tesla said on Thursday it was doing its best to keep production going at its Shanghai factory while it cooperates with China's COVID-19 prevention measures.

www.reuters.com

 

[JohnDe]

Tesla: Elon Musk opens delayed 'gigafactory' in Berlin​

Tesla boss Elon Musk has opened a huge electric car "gigafactory" near Berlin which is the first European hub for the firm.
The plant was delayed for eight months after local authority licensing problems.

The more than €5bn (£4bn) factory is the biggest investment in a German car plant in recent history.

Tesla said more than 3,000 of the factory's expected 12,000 workers had been hired so far.

Mr Musk said: "This is a great day for the factory," describing it as "another step in the direction of a sustainable future".

German Chancellor Olaf Scholz said the plant was a sign of progress and the future of the car industry.

Tesla will deliver its first 30 German-made Model Y Performance cars on Tuesday. The firm says the cars have a 514km (320 mile) range and cost €63,990 (£53,000).

At full capacity, the plant will produce 500,000 cars annually - more than the 450,000 battery-electric vehicles that German rival Volkswagen sold globally in 2021

 

[JohnDe]

EV Buyers Only Want a Tesla (TSLA) and Demand is 'Monstrous' - Chowdhry​

Tesla (NASDAQ: TSLA) bull Trip Chowdhry continues to pound the table on the stock amid what he has been calling "monstrous demand."

According to Chowdhry, customers don't want to buy just any EV; they only want a Tesla. "The customer only wants to buy TSLA and nothing else," he said.

The analyst also again compared Tesla to Apple, saying Tesla is an experiential product, which at one time Apple was an experiential product. He said every day a Tesla vehicle feels like a new vehicle. "No other company has the capability to create experiences like TSLA can," he commented.

Chowdhry also highlighted news that Hertz will add Tesla Model Y's to the fleet, another sign of the "monstrous demand."

He reiterated his Overweight rating and $1500 price target on TSLA.

 

[mullokintyre]

Tesla shares pop a quick 5% after Teslas tweets it wants to issue more shares to enable a stock split.
From Zero hedge

Despite the fact that increasing the share count does little to nothing to add value to the underlying business, Tesla stock shot up by 5% after the news was announced, following a trend it set the last time the company split its stock and immediately saw it rise.
Just moments ago we reported that Tesla stock had its best 7 day stretch since 2021, despite what appears to be mounting tensions between CEO Elon Musk and the Securities and Exchange Commission.

The run up in shares of Tesla came amidst a broader market rally and despite the fact that CEO Elon Musk faces mounting tensions with regulators. As we've reported over the last month, Musk is jousting with the SEC about whether or not he should still be beholden to his 2018 settlement agreement with the agency which required a "Twitter sitter" to review all of Musk's online communications.

The U.S. Securities and Exchange Commission has said Musk has not met the "high burden" necessary to throw out the 2018 consent decree he is under, according to Reuters. Musk found compliance "less convenient than he had hoped," the SEC argued, adding that "when it comes to civil settlements, a deal is a deal, absent far more compelling circumstances than are here presented."

Mick

 

[JohnDe]

Tesla shares pop a quick 5% after Teslas tweets it wants to issue more shares to enable a stock split.
From Zero hedge


Mick

Worked out quite well when they did that last time. The main idea is to keep the share price affordable, especially for employees who take up the option of the SPP as part of their pay benefits.

Another reason for the price rise over the past week could be the numbers -

 

[Value Collector]

Worked out quite well when they did that last time. The main idea is to keep the share price affordable, especially for employees who take up the option of the SPP as part of their pay benefits.

Another reason for the price rise over the past week could be the numbers -


View attachment 139632

View attachment 139633

Maybe they need to do a 1000 for 1 stock split, so the share price drops to $1 and they will never have to worry about stock splits again.

I always wonder why American companies seem to hate having share prices under $100, but then rush to split when it hits $500 or $1000, resulting in some companies regularly doing splits (every 5 or 10 years of so).

I have no idea why they just don’t do a low share price eg $1, to begin with and not have to worry about another split for 100 years or so.

 

[JohnDe]

Maybe they need to do a 1000 for 1 stock split, so the share price drops to $1 and they will never have to worry about stock splits again.

I always wonder why American companies seem to hate having share prices under $100, but then rush to split when it hits $500 or $1000, resulting in some companies regularly doing splits (every 5 or 10 years of so).

I have no idea why they just don’t do a low share price eg $1, to begin with and not have to worry about another split for 100 years or so.

When I read your post my first thought was, 'if the SP is dropped too low it could create a snowball affect of trader activity which adds no value and undermines long term investors.

Disadvantages of Stock Splits

3. They May Attract the Wrong Type of Investor
Warren Buffett isn’t only known for his incredible and unprecedented investing success but also as the CEO and chairman of Berkshire Hathaway, one of the most valuable companies by market capitalization in the world. One unique characteristic of Berkshire’s stock is that its Class A shares are by far the most expensive stock in the world trading at a whopping $430.000 per share as of October 21.

Clearly, not everyone would be able to buy class A shares because of that prestigious price to buy one single share. But why exactly has Warren Buffett decided to not split the stock a single time in its history?

In Berkshire’s letter to shareholders of 1984, Buffett wrote that he isn’t intending to split Berkshire’s stock.

The primary reasoning behind Buffett’s intention is that he views his shareholders as partners who are committed to the long-term success and performance of the company. As a consequence, he would rather prefer long-term partners instead of day-to-day investors that buy and sell the stock in short periods just like any other stock.

If the company agreed to split the BRK-A shares multiple times in the company’s history, they would now trade at affordable prices entries that could have allowed any investor and trader to get in and out of the company.

The high price of class A shares at which they trade today will make most investors think through their investment thoroughly before they decide to invest in the company.