Tesla USA sales struggling

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David Green

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Wow, Q3 estimates are in, and WOW, it's brutal....

Model S down 60% over Q3 2018, 3125 for 2019 Q3 vs 7575 for 2018 Q3
Model X down nearly 40% over Q3 2018, 4725 for Q3 2019, vs 7825 for Q3 2018

And Model 3 down 20% over Q3 2018, 46850 for 2019 vs 54300 for 2018

I understand Model 3 is now going world wide, but USA sales for the other manufacturers are not down like this, and Tesla has lots of inventory around the USA... Demand has cooled for sure... As for S and X, Their sales are down around the world.

The earnings report is going to be brutal next month as the $ per transaction is WAY down over 2018...
 
I think model s and x are mostly down because they focus on selling 3?

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Esprit1st said:
Yes, I do. [emoji2962]

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Interesting, and you think this was Tesla's plan? Its interesting as I do think naturally many Tesla customers have migrated to the lower price offerings, and an equal number have migrated to competing cars like the I-Pace and E-Tron. Actually following both forums I find nearly every E-Tron and I-Pace customer was a previous Model 3 reservation holder.

Anyway, Tesla Model 3 has cannibalized their high end offerings, which is something Elon Musk said would not happen. But in the USA Model 3 sales are also down in Q3 2019 over 2018, so Tesla is down across the board in USA sales, that is not going to be pretty on the earnings report. For comparison GM sales were up 6.3% in 2019 Q3 over 2018 Q3, and looking deeper in to the sales, their trucks especially diesel (highest margin product they have) are Way up 38% and their low margin cars Cruze, Sonic are way down (both cars discontinued) I think GM is going to have a pretty nice earnings report for Q3... and the current strike is going to help them adjust inventory for the upcoming recession I am all but certain is coming this winter. Is Tesla ready for the recession?
 
Well, of course i-pace and EQC and etc. customers were model 3 reservation holders. There was nothing out there before. And these people were interested in EVs anyways.

However, Tesla doesn't do ANY advertisement. As hardly any other EV maker does. So I believe it's no surprise that after a lot of the early adopters have a car now demand might slow down.

And yes, I believe it's "planned" because Elon promised that the model 3 will take off, so they put all their efforts into that model to not disappoint wall Street. I believe it would be better to take Tesla private just like Elon tried (and messed up big time).

And we will need advertisement for EVs. The days of early adopters are coming to an end. And most people have no clue about electric cars.

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Esprit1st said:
Well, of course i-pace and EQC and etc. customers were model 3 reservation holders. There was nothing out there before. And these people were interested in EVs anyways.

However, Tesla doesn't do ANY advertisement. As hardly any other EV maker does. So I believe it's no surprise that after a lot of the early adopters have a car now demand might slow down.

And yes, I believe it's "planned" because Elon promised that the model 3 will take off, so they put all their efforts into that model to not disappoint wall Street. I believe it would be better to take Tesla private just like Elon tried (and messed up big time).

And we will need advertisement for EVs. The days of early adopters are coming to an end. And most people have no clue about electric cars.

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You have some very interesting thoughts on the subjects. I am not sure I fully understand what you think is Tesla strategy, because I think they would much rather sell a model S, or model X then a model three, just based on the fact that they make more money on each unit sold of the S and X. In a company like Tesla, every quarter it is a race to try to overcome the expenses with revenue, unfortunately for Tesla the expenses have been winning most of the races. The only 2 quarters where Tesla made a very small profit we’re also the two highest quarters in revenue the company has ever seen. Since then, the average transaction price has been falling like a rock, and unfortunately expenses moved back into the lead of the race. When does the company is public or private, has nothing to do with the expenses or revenue, so going private does not not make the company profitable. Going private only makes the financials worse, because it is not as easy for executives to sell their shares to increase their income. Private companies have a harder time attracting executive talent because the compensation package is typically not as good. Elon musk does not like being public, because he does not like to disclose the real financials because they are bad, and they do not match his guidance most quarters. I see GM has no trouble being public, they are happy to share the financials, but their company is also not a bloated wanna be tech company when it comes to market cap, the GM market cap is pretty legitimate for a company of that size and profit.
 
David Green said:
Wow, Q3 estimates are in, and WOW, it's brutal....

Model S down 60% over Q3 2018, 3125 for 2019 Q3 vs 7575 for 2018 Q3
Model X down nearly 40% over Q3 2018, 4725 for Q3 2019, vs 7825 for Q3 2018

And Model 3 down 20% over Q3 2018, 46850 for 2019 vs 54300 for 2018

I understand Model 3 is now going world wide, but USA sales for the other manufacturers are not down like this, and Tesla has lots of inventory around the USA... Demand has cooled for sure... As for S and X, Their sales are down around the world.

The earnings report is going to be brutal next month as the $ per transaction is WAY down over 2018...
Click to expand...


Added Note Inside EV revised their Tesla estimates downward, so the delta is larger than expected for the Model 3 USA sales Just 44000 for Q3 2019 VS 54300 for Q3 2018... Ouch...

Chevy Bolt is now well ahead of Model S in USA sales for 2019, and gaining on Model X.
 
@David Green I absolutely agree with you. They should sell more model S and X to make more money. Maybe Elon talked himself into something he can't hold up or wasn't the best plan. Wouldn't be the first time. I think he just says what he thinks without making sure the details are communicated right. He said the model 3 will cost 35k. When it came out it did cost more because it was the premium version. It makes sense from a company standpoint but people were disappointed. Maybe Tesla pushed the 35k version to early.

However, Teslas goal was always "to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible". I would actually argue that that goal has pretty much been reached. Without Tesla I would bet we wouldn't have any other auto maker build a single EV.

The difference between public and private is of course what you mentioned, but also the pressure to satisfy stock owners. You can grow slower as a private company, but just look at the current numbers. Tesla fell only about 3k or so model 3 deliveries short of the forecast, but the stock price fell 3% because they didn't fulfill their forecast. Nobody would give a f*** if it was a private company. I'd say everybody would probably be happy because of such great sales.

Maybe you can tell that I'm not a fan of Wall Street. I actually think it's nothing but a fraud. A company's value doesn't change because a CEO calls somebody a pedo, or smokes pot. It's stupid! Not saying it's right, but it doesn't have anything to do with how the company performs or how the CEO performs.

Just a little rant there [emoji38]

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Esprit1st said:
@David Green I absolutely agree with you. They should sell more model S and X to make more money. Maybe Elon talked himself into something he can't hold up or wasn't the best plan. Wouldn't be the first time. I think he just says what he thinks without making sure the details are communicated right. He said the model 3 will cost 35k. When it came out it did cost more because it was the premium version. It makes sense from a company standpoint but people were disappointed. Maybe Tesla pushed the 35k version to early.

However, Teslas goal was always "to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible". I would actually argue that that goal has pretty much been reached. Without Tesla I would bet we wouldn't have any other auto maker build a single EV.

The difference between public and private is of course what you mentioned, but also the pressure to satisfy stock owners. You can grow slower as a private company, but just look at the current numbers. Tesla fell only about 3k or so model 3 deliveries short of the forecast, but the stock price fell 3% because they didn't fulfill their forecast. Nobody would give a f*** if it was a private company. I'd say everybody would probably be happy because of such great sales.

Maybe you can tell that I'm not a fan of Wall Street. I actually think it's nothing but a fraud. A company's value doesn't change because a CEO calls somebody a pedo, or smokes pot. It's stupid! Not saying it's right, but it doesn't have anything to do with how the company performs or how the CEO performs.

Just a little rant there [emoji38]

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Tesla cannot sell more S and X, they are trying, believe me... I get emails from them at least once a month with different special deals.

I am not sure what you have a problem with Wall Street? Analysts are trying to figure out and place values on companies based on revenue growth, profit and other forward metrics. Year after year Elon Musk makes statements that Tesla cannot back up, and thereby loses the faith these analysts have in Tesla. Where is the Semi he told us would go into production in 2019? Where is the Solar Roof that he has told us is ramping production in every earnings call since the Solar City acquisition? Earlier this year Musk said Tesla would build 500K cars, they are barely over 250K currently, so they better step on the gas with only 3 months to go.

You talk about Wall Street valuation based on CEO performance, or fundamentals, but Elon has stated in 2017 that Tesla would be profitable and cash flow positive every qtr after Q2 2018, well the last 3 have been losses, and with constant restructuring, and even with higher production Tesla cannot turn a constant profit. How do you value a company that loses money? I say you appraise the assets, and subtract the liabilities, this would leave Tesla with negative equity, so what is it worth? Liabilities higher than assets, and not consistently profitable, I say its worth nothing.
 
Well yes, I'm not saying it's easy to evaluate as company. And if you look only at the revenue, yes, Tesla is worth nothing.

It's more complicated than that as you mentioned. But "information" like the ones I mentioned that don't have anything to do with the company is definitely not part of it. To me it's clear that these do called Wall Street or money market experts make money by seeding true or false "information" and then make money off it.

However we're way off topic ... [emoji6][emoji41]

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Esprit1st said:
Well yes, I'm not saying it's easy to evaluate as company. And if you look only at the revenue, yes, Tesla is worth nothing.

It's more complicated than that as you mentioned. But "information" like the ones I mentioned that don't have anything to do with the company is definitely not part of it. To me it's clear that these do called Wall Street or money market experts make money by seeding true or false "information" and then make money off it.

However we're way off topic ... [emoji6][emoji41]

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Well, Stock value in a growing company often has to do with investors faith in the leadership, and investors are losing faith in Musk, as more and more of his promises and predictions fail to become reality and the profits he guides fail to materialize. BTW Musk was in federal court yesterday in a lawsuit over the Solar City acquisition, how can he be a great leader for Tesla when he spends so much time in court? I think wall Street is losing faith in Musk as a leader, and every deposition and court hearing takes more of that faith when you see things like he hired a shady private investigator to try to "find dirt" on the alleged Pedo Guy. What CEO does something like this? meanwhile investors are losing equity... Tesla is now trading lower than it was 5 years ago,, while Musk is calling names on twitter, and getting sued. If somebody here is stupid, I have to point that finger at Musk, he should not be getting himself into these problems. Wall Street analysts are just trying to make rational sense of the irrational.

https://www.businessinsider.com/elon-musk-aide-hired-investigator-diver-tesla-ceo-called-pedo-2019-9
 
Just to show how desperate and ever more Ludicrous™ the claims by serial Tesla bashers are, for Tesla supposedly having "struggling sales", it was pointed out in reports and comments at InsideEVs News today that:

1. Despite the challenging past three months, Tesla sales in the U.S. are up 19% so far this year. (And of course, up far more than that worldwide.)

2. Tesla has increased its U.S. BEV market share from 30% of the market to now 80% of the market.

I'll cry some crocodile tears for all the Tesla shorters and FUDsters who always, but always have their hopes for Tesla's failure end in a metaphorical train wreck.

crocodile-tears.jpg
 
How about the expiring tax credit??
If there still was a $7500 tax credit on the Model 3, I would be driving a Model 3 instead of a Kona right now.
As for Marketing, I think that Elon Musk is a genius. No need to run ads.. Just smoke a joint on a Podcast and have the entire nation talk about you.. There is no such thing as bad publicity. Donald Trump used the same exact concept.. He says outrageous things and gets coverage.. Same goes for Musk. No matter if the coverage is for something deemed good or bad, it still gets his name and therefore his brand out there.
 
BlueKonaEV said:
How about the expiring tax credit??
If there still was a $7500 tax credit on the Model 3, I would be driving a Model 3 instead of a Kona right now.
As for Marketing, I think that Elon Musk is a genius. No need to run ads.. Just smoke a joint on a Podcast and have the entire nation talk about you.. There is no such thing as bad publicity. Donald Trump used the same exact concept.. He says outrageous things and gets coverage.. Same goes for Musk. No matter if the coverage is for something deemed good or bad, it still gets his name and therefore his brand out there.
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No doubt the expiring tax credit is a headwind for Tesla... Tesla would be helped if the tax credit went away completely.
 
David Green said:
No doubt the expiring tax credit is a headwind for Tesla... Tesla would be helped if the tax credit went away completely.
Click to expand...
No doubt.. The 4th quarter 2018 numbers were exceptionally good because of the expiring tax credit. Many people pulled the trigger at that time. I missed out. At that time, I was trying to sell my Classic Corvette Convertible and wanted to pay cash for the Model 3. However, the car didn't sell. Then the tax credit went away (at least half of it and later 75%). I also got a discount on the Kona and the lifetime warranty on the battery on the Kona was tempting too, so I ended up buying the Kona. If it wasn't for the expiring tax credit, the base price of the Kona and the mid range Model 3 were within about $1000, so virtually no difference.. I don't regret going with the Kona as it's a awesome car with well underrated range but I really love the looks and performance of the Model 3. I'm pretty sure that my next car will be a Tesla but that may be 8 years from now. At that point battery technology should be a lot more advanced..
 
BlueKonaEV said:
No doubt.. The 4th quarter 2018 numbers were exceptionally good because of the expiring tax credit. Many people pulled the trigger at that time. I missed out. At that time, I was trying to sell my Classic Corvette Convertible and wanted to pay cash for the Model 3. However, the car didn't sell. Then the tax credit went away (at least half of it and later 75%). I also got a discount on the Kona and the lifetime warranty on the battery on the Kona was tempting too, so I ended up buying the Kona. If it wasn't for the expiring tax credit, the base price of the Kona and the mid range Model 3 were within about $1000, so virtually no difference.. I don't regret going with the Kona as it's a awesome car with well underrated range but I really love the looks and performance of the Model 3. I'm pretty sure that my next car will be a Tesla but that may be 8 years from now. At that point battery technology should be a lot more advanced..
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In 8 years you will have lots of EV choices, and I imagine by that time, Tesla will be owned by Toyota, and will be turning out high quality products.
 
David Green said:
In 8 years you will have lots of EV choices, and I imagine by that time, Tesla will be owned by Toyota, and will be turning out high quality products.
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I can't see Toyota, don't need them, and not much synergy, opposite actually with their very different corp cultures. More likely Apple, Google or Amazon.
 
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