I honestly don't think it does.
Demand for Tesla vehicles is decreasing due to increased competition, Tesla not updating their vehicles and Elon putting people off. They might hit 1.8 million vehicles delivered to match or exceed 2023 numbers, but if they've had to heavily discount those vehicles and/or offer incredibly low finance rates then it doesn't matter.
If you sell 100 units at $5 profit, you're doing much better than if you sell 200 units at $1 profit.
Selling vehicles made in China to China produces much less profit than selling vehicles made in China to Europe. Gaining market share is less important if you're making less profit per vehicle than your competitors.
Honestly this ioesnt make sense.
You mention Tesla having to sell vehicles at a discount, yet then mention competition. Are any of the competitors making any money off their EVs, especially in China? Actually anywhere.
We heard the competition for so many years it is laughable. BYD might be the only one although some are speculating they arent making money on their EVs. Look at legacy.
GM suffered a 2% decline, YoY in total about they were up in EVs (I think 60% YoY). What is the profit margin on those vehicles? They dont break them out but we know Ford is losing a boat load on every car.
This is rather short sighted. Actually it is incorrect. That is like saying Apple has to sell their phones at a profit to make any money. Of course, Apple does but they also have a ton of post sale revenues.
As for growth, there is plenty of it. The problem is most of the media that is out there is either clueless or refuses to acknowledge what is taking place.
I think the difference is Tesla's costs. Vehicles made in the Germany factory are extremely expensive to make, and the factory is well under capacity (it might even be less than 50% capacity) which makes it really hard for that investment to be profitable. So Teslas made in Germany actually cost Tesla money - and I'm not sure the aftermarket sales make up for that.
Teslas made in the Shanghai factory are much, much cheaper - but Teslas sold in China are a lot cheaper as well... I think around $37K USD versus $50K USD in US and Europe... so a vehicle made in China and sold to Europe is very profitable... but a vehicle made in China and sold in China isn't... and a vehicle made in Germany and sold in Europe isn't.
We'll see on October 23rd, but I would expect revenue to drop and cost of revenue to increase.
Profitability for Rivian doesn't matter so much because they're insulated by Amazon, BYD has the support of the CCP. Legacy Auto is in big trouble - I do not have any auto shares at all because I do think we're in an auto recession.
That said, Tesla's market share of the EV market is decreasing, 75% in 2022 to 49% in Q2 2024... so obviously competition is affecting Tesla's financials at the moment.
What growth do you mean? Tesla's energy sales decreased this quarter, they don't have AI products yet, Teslas deliveries aren't growing but their inventory grew from 105,549 units to rise to 113,455 this quarter... which implies demand is slowing - what is the growth that I'm missing?