Tesla production fell by 15 percent in Q2 2024 as sales continue to decline
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I mean, maybe they shouldn't be building vehicles that are literally rolling pieces of trash? Or have a CEO that seems bent on making himself as dislikable as humanly possible? Maybe that would increase their sales and production? Shocking concept, I know!
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I think that I said this before they reached the 1M cars made in a year milestone. I could see in their reports and in news articles the building of factories to reach the 1.3M milestone and the 1.8M milestone. I didn't saw the pipelines of factories coming online or expansions of operations to reach the 2.5M milestone and the 3.5M milestone that they were supposed to achieve by increasing production by almost 50% each year as promised.
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Stock is up not because investors didn't mind, but because the dip wasn't as steep as expected. So YoY sales are down but Tesla beat market expectations. Yesterday's stock had priced in the expected decline so beating that has lead to a recalibration. Its probably over the top and we'll see a correction in the coming week.
And selling over 400K EVs is still 400K+ less ICE cars on the road.
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Curious when Tesla starts selling “tech” instead of basic EV cars and solar distribution. They’ve been selling the idea of Tesla being a “tech” company for a few years now since their car portion seems to be mature. The stock price will come down when big investors are finally ready to take a loss on the reality of the company.
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What tech do they have to sell? Their batteries aren't anything special. Their self-driving tech is behind what other manufacturers are already releasing. Elon claims they are pivoting to AI, but to what end? They're even further behind on LLMs and general purpose AI than they are on self-driving.
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If GM or Ford deliveries dropped an additional 5%, after dropping last quarter as badly as Tesla’s did, the stock price would implode so hard you would hear a pop. Executives would be hurling themselves out the windows.
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Most of the sales are online, you mostly don’t go to a lot and drive off with a car that was waiting on the lot a few hours later. The showrooms are mostly just for show, and then you order a car and get one delivered a few weeks later.
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We are starting to see one, though many dealers are still digging their feet in. I honestly think Musk being all... Musk-y isn't anywhere near as relevant to Tesla's lagging sales as the fact that the American auto market is generally in freefall at the moment. You could be selling Toyotas and the last few months would have been very slow.
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But hey, at least Elon got his $46B and supports the guy who wants to stop all electric car production in the US.
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And yet, its stock still continues to be worth more than 10x that of Rivian.
I just don't get it.
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Back in the day, we often wished GM execs would hurl themselves out of windows, but they were usually back the next quarter making the same poor decisions. :/
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AIUI they get their most of their batteries from Panasonic, and Tesla’s attempts at building their own new batteries has not gone well.
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I mean, lower prices are great, but it depends on how they get the price to go lower. If they have plenty of profit margin, they can drop that, but once that gets too tight, other things have to get sacrificed to get prices to go down. Tesla has already started cutting out things that are useful (stalk on the steering wheel anyone?) and their build quality isn't the greatest, what else would you like them to cut to be able to lower prices?
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Yeah, no. Tesla's current share price absolutely demands phenomenal performance by the company. Not just industry beating but complete and total industry domination. This report isn't that. What we're seeing is Tesla becoming a rock-solid stonk. Leader of the Meme 100 index.
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People aren't buying stock in Tesla. They're buying stock in Elon, as proven by the ~45B blackmail deal Elon got. And buying into a cult leader may work in the short term, but long term...
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As someone who wants to see general transport electrification asap, what annoys me is the opportunity cost that the Cybertruck (a generally stupid vehicle with some nice internal, technical elements) represents to the development of the much discussed (and denied) "Model 2". Stans might make the case that those Cybertruck technical changes represent a pathway to the M2, but I'm just not seeing it.
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That's because Tesla does 99% of it's sales on line. Not having to deal with a car salesperson is certainly one of the nice things about buying a Tesla. You boomk a demo ride though the website, set up financing and trade in through the website and complete the purchase through the website. Then when delivery day comes they bring your new car to your house and drive away your trade in. Putting aside everything else about Tesla and Elon, it's a very nice way to buy a car.
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I like how the "bright spot" is that after multiple quarters of building thousands of more cars than were sold, they finally started to realize that maybe they should pay more attention to how many cars they're actually selling to figure out how many they should build.
Sales in China slowing down considerably isn't surprising at all. The standard arc of any foreign company doing business in China is to get wooed into investing big in the country so they can tap the giant market. Initially do very promising sales, since there's little to no competition. Begin to hyperventilate over one billion potential customers. Barely note that several domestic competitors have suddenly popped up. Then very suddenly realize that those competitors are eating your lunch, and all your investments for massive scaling might have been horribly overconfident.
Sales in China slowing down considerably isn't surprising at all. The standard arc of any foreign company doing business in China is to get wooed into investing big in the country so they can tap the giant market. Initially do very promising sales, since there's little to no competition. Begin to hyperventilate over one billion potential customers. Barely note that several domestic competitors have suddenly popped up. Then very suddenly realize that those competitors are eating your lunch, and all your investments for massive scaling might have been horribly overconfident.
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If Tesla sales had dropped an additional 5% then I’m pretty sure the stock price would have fallen. That didn’t happen: unit sales are up compared to Q1, by about 6%. They are down year on year, but less than they were down in Q1.
Still not great news. Unless they took time off to improve their process, a production decline isn’t a great way to grow the business. And that increase is probably including a bunch of price cutting — unit sales aren’t the same as revenue.
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It's all gone insane ever since people stopped caring about dividends and instead just share prices. Rather than people owning a portion of a company and then getting part of the returns because they own some of it, now you only make (significant) money by buying now, waiting for shit to get more expensive, then sell it to the next bag holder.
Repeat ad infinitum. No, really, that's the model – assume infinite growth. It's a laughably absurd concept that is unironically embraced by most economists (because most are politically driven hacks, if it isn't behavioral, it's pseudoscience).
Here's the fun part! Economic growth has always been tied to resource consumption. So infinite growth = infinite resource consumption => we live on a single planet with finite resources => infinite economic growth cannot happen without severe climate change = mass extinction.
Many of the ultra rich probably know this to some degree and just don't care. But HUGE swaths of the general population are blissfully unaware of how blisteringly stupid the concept is.
In the 70s, if a stock didn't pay dividends, it was considered either a poor investment or at least a very risky one. People wanted dividends because that's how the goddamn market was supposed to work. Corporations are a crowdfunding model.
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They're ahead of the pack in the sense that they have a good supply of batteries for their own cars. But Tesla doesn't have the kind of free production capacity that would enable them to produce for other manufacturers.
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They’re selling more than 10x as many cars as Rivian and they’re making money on each car unlike Rivian. It’s not that surprising. Rivian has a pretty clear path to profit as long as they don’t stumble; Tesla has been profitable for years.
What Tesla no longer has is a clear path to growth. Musk or the board should have hired someone to run the place several years ago.
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Yeah, Rivian is way overvalued.
They released Q2 numbers today. They made 9600 cars and delivered 13000.
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BobbyBobberson
Ars Scholae Palatinae
I guess nobody told Southern California this. I see more Teslas than Camrys at this point.
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And given that the the head of their new vehicle development team also got laid off, it's not clear where the path to any new vehicle might come from. It's just a car company with an increasingly stale lineup that's seemingly lost interest in making cars.
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