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Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

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Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#281

Post by skgoa »

kristianp wrote: post #102
Someone wrote: post #32

Earlier quoted context omitted.

”Some lines are at only 500 cars a week.” That sounds better than what Tesla claims. http://files.shareholder.com/downloads/ABEA-4CW8X0/549293785... (emphasis added): ”Other lines, such as battery pack assembly, body shop welding and final vehicle assembly, have demonstrated burst builds of about 500 units per week and are ramping up quickly.” If you can do burst runs of 15 km/hour, that doesn’t mean you can run a th…

"To get that $1.4 billion in revenue, they will need to sell 40k Tesla 3s at $35k each, or 3,000 a week. To get it in margin, even assuming the average model 3 will sell for $50k, they will have to sell 12,000 a week or so (at 20% margin)" It seems like you're assuming that the cash burn will stay at 1.4billion. Expenditure should go down once the production line tooling is complete.

During the conference call, Musk himself said that CapEx in Q4 could be as high as in Q3.

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#282

Post by avs733 »

sobani wrote: post #252
rsynnott wrote: post #240

> But a problem with a subcontractor, compounded with other issues, forced Tesla to start over in certain areas, delaying production. > “We had to rewrite all of the software from scratch,” Musk said, adding that they’d redone “about 20 to 30 man years of software in four weeks” for the battery module. Maybe I'm just overcautious, but I would prefer not to be anywhere in the vicinity of a high-discharge actively cool…

20years * 50weeks / 4weeks = 250 assuming a man year is 40h/week and those 4 weeks were a crunch of 80 hour weeks, then 125 people worked on the same piece of software, assuming no ramp up time. Is this even possible?

possible sure! likely or useful or effective...probably not

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#283

Post by Retric »

coldtea wrote: post #267
api wrote: post #222

Earlier quoted context omitted.

It's almost like Mercedes has been doing this for a long time.

That's a moot point though. If you want to compete in a market, you got to play at the speed/quality/prices of the market -- there is no slack given for being new.

Tesla's profit margins are fine, this is all a question of ramping up to cover demand. Which tends to be much simpler when you are already a huge company.

Their real risk is if the Model 3's reliability is bad or they need a recall thus reducing their profits significantly.

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#285

Post by gjem97 »

coldtea wrote: post #267
api wrote: post #222

Earlier quoted context omitted.

It's almost like Mercedes has been doing this for a long time.

That's a moot point though. If you want to compete in a market, you got to play at the speed/quality/prices of the market -- there is no slack given for being new.

Seems like there's a lot of slack given for being new. They have had relative ease raising capital, their market cap is still enormous relative to the number of cars produced, and lots of people are still on the waiting list for a car that they won't get for years.

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#286

Post by maxsilver »

hwillis wrote: post #137
sushisource wrote: post #60

Earlier quoted context omitted.

How about compared to the Bolt, though? The Bolt seems dramatically more competitive than the Leaf. 200hp, comparable range, and cheaper than the model 3. I think people getting fed up with the wait and switching to Bolts en-masse is a possible scenario. Imagine if Chevy made an ad targeting exactly that scenario.... (You can thank me later Chevy ad execs)

The Bolt is $154/mile of range vs $132 for the model 3 and has 30% less horsepower. The model 3 is just under twenty one inches longer and 6.6 inches wider. The Bolt is nearly the size of a mini. It's not in the same purchase category for most consumers. It's also hastily and very poorly designed- the lead aero guy called it a nightmare. To me the most indicative thing about that is the weight. Despite being almost t…

> It's a shitty car, and non-electric reviewers have loathed it.

It's a perfectly good car, and most non-electric reviewers have said its only major fault is being "not sexy, not cool". Doug DeMuro, for example - https://www.youtube.com/watch?v=d2ogGZXmepY

> the bolt weighs more than the (short range) model 3.

Sure, but only barely. The short-range Model 3 weighs 3,549lbs, and the Bolt weighs 3,563lbs. Your complaining about a difference of 14 pounds (less than 1%). The Bolt also delivers 18 extra driving miles of range, which explains a small portion of the weight difference.

> the lead aero guy called it a nightmare

Of course he did, they sacrificed aerodynamics for comfort. Some of the big complaints with Chevy's last electric car (Volt) was that it was too low to the ground and too short -- all great things for aerodynamics, but all things that actual humans complained about. So they made the Bolt a proper hatchback -- taller and sit higher -- to make it nicer for the occupants. Chevy, shockingly, listened to their customers and made some changes they requested.

The Bolt is perfectly fine car. Obviously it's not as sexy or luxurious as a Model 3. But the Bolt is not in any way a "shitty car" -- by most accounts, it's fast, comfortable and reliable. In fact, the Bolt is arguably the best electric car you can actually purchase in the US today -- and likely will be for the next year or so until Tesla solves their production struggles.

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#287

Post by avs733 »

pwinnski wrote: post #2

The first two zones of a four-zone process to produce battery packs are being completely reworked, and this is something they only found out about after they were already failing to deliver on promised production goals? I've mis-estimated a lot of things in my career, so I'm trying to be sympathetic, but it seems like someone with production line experience should have been able to test individual parts of the produc…

So I apologize that this is basically assertion based and vague but I need to protect friends a little bit.

I went to undergrad for mechanical engineering at a university generally known for turning out good auto industry engineers. A few years out of school (maybe 2010-11?) I noticed a lot of my alumni friends were starting to move from places like Honda, Toyota, GM, etc. to Tesla. These were the friends I would generally have considered the most motivated and best engineers I graduated with or new in college. To a man (pardon the gendering) they are not at Tesla anymore. They have all left, most for other startups, and they all left disillusioned with the internal Tesla management. They all left completely burned out.

They basically felt that a lot of managers with experience in software were brought in and made very bad assumptions about the translation of software development to mechanical device manufacturing...and wouldn't let go of them. Its not that those assumptions NEVER transfer but they don't ALWAYS transfer. Manufacturing ramp up is really really really really hard. Intel has a 10 billion dollar site in Oregon that does nothing but figure out how to put together a manufacturing process that minimally functions and then figure out how to scale it up. Ramping manufacturing is different than designing the parts. You have layers and layers and layers of design. The big OEM's use suppliers not just to outsource cost and employee management but because they allow those companies to build expertise in a specific area that the OEM then no longer has to maintain. I heard stories from friends there about Tesla managers trying to be "Apple like" and demand tighter tolerances on every dimension of a part, driving up not just cost but lead time as suppliers tried to figure out how to retool their whole process to meet the request. I heard stories of requests to design custom bolts to use throughout the process for no discernible reason. That custom bolt (1) means longer design time, because a part that shouldn't have to be designed has to be designed, (2) means greater cost, (3) and means a supplier has to ramp up their own manufacturing of a new part - but hey blame the supplier. I think the most interesting ones were related to internal culture. Tesla is a car company...I know there are all these cool elements of an office we expect of a startup, but having a beer cart rolling around on Friday's at a car company may not send the best image.

I now work at a couple universities (grad student/lecturer) and Tesla is the hot employee all the students want, not unsurprisingly, and they are all about campus recruiting. That can work great, but it relies on having a strong base of experienced engineers to train these people. Tesla has not managed to hold on to that experience from my limited dataset and is instead replacing them with cheap inexperienced labor attracted by the 'aspirational' nature of Tesla as an employee. From the pool of friends I have seen go to SpaceX, I have not heard the same things.

Re: Tesla posts big loss, cuts production of Models X and S to catch up on Model 3

#288

Post by cataflam »

adventurer wrote: post #203
paulpauper wrote: post #161

Earlier quoted context omitted.

seeking alpha is a user contributed site. they don't predict anything. their authors do. and most off them have terrible track record and are trying to push their newsletters , funds, and other crud on an dwindling supply of dumb mom & pop investors who read the site

I'm not sure at this point, but they used to allow anyone to write articles. You were paid based on pageviews. I put their analysis of companies right up there with Marketwatch headlining a big crash everytime there is a down day in the markets.

Indeed, if you click "expand" next to "About this article" at the bottom you will read :

>Author payment: $35 + $0.01/page view. Authors of PRO articles receive a minimum guaranteed payment of $150-500.

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