Earlier in the year, the guidance was put out that Tesla would match the 2023 sales (1.8 million).
In this video I discuss what this looks like as we await the Q3 numbers. If they reach estaimtes from Wall Street, do they have a chance to match it?
▶️ 3Speak
Honestly, I don't think that's the right question. The question for me is what is the revenue they're bringing in from sales? Their low interest rates in the US and China have to have some effect on revenue. I'm super curious to what that effect is.
It doesn't really matter how many vehicles they deliver if the profit margins are different/region-based.
Considering many, including yourself, didnt think $1.8 million was possible, I think it is a very valid point.
It most certainly does. They are picking up market share in the largest automotive market in the world. Unlike legacy auto which is getting their clocks cleaned, like VW, Audi, and GM, Tesla is selling more in China, gaining share.
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?
I am trading Tesla in my family's 'hedge fund' so I guess I should pay more attention to your Tesla content, lol.
Working a cash covered put/ covered call options strategy. It's been treating me well so far.
It can be a volatile stock so if you are short term it, then it could be one that pays off. Of course, have to be on the right side of the trade.
Yeah, I am trading weekly options. Working out very well so far.
But yeah, that's what my Logical Trading Indiactor PRO is for, to help me stay on the right side of the trade!
Just a word of warning... I'm expecting the stock to dip significantly on the 10th of October after the Robotaxi reveal.
Don’t matter, I make money either way with my strategy.
What makes you think it’s going to drop so significantly?
You do? That's awesome! Well done on working out that strategy.
The Tesla Event days almost always incur a sell off directly afterwards and in the days afterwards. I think there is a lot of skepticism for this particular event because some people bought Tesla vehicles under the premise that they'd become Robotaxis... but they're likely going to unveil a Cybercab vehicle which (if it has Lidar) might signal to the market that Tesla vehicles might never become Robotaxis and a passive income source (ie, earn while the owner is asleep or working).
So I think a sell off is more likely than not - unless its absolutely spectacular and blows everyone away.
Good to know. I mainly focus on technicals for the most part, and selling Tesla options are quite lucrative whether I actually end up with the stock or not.
That lets me know, also after today's dip, that I will be looking at selling some lower puts (which is how I make money up or down, is with selling put options if I am in cash or call options if I have 100 shares of the stock).
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