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Tesla reports first quarterly profit in more than three years

reuters.com

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Re: Tesla reports first quarterly profit in more than three years

#81

Post by TillE »

greglindahl wrote: post #75
gubby wrote: post #45

Earlier quoted context omitted.

At least in the UK, such a term would have to be brought to your attention before the sale, very clearly, for it to be part of the contract. Writing that in the manual would have no effect.

Interestingly, in the UK paperback books have a little contract in the front saying you can't rebind them into hardbacks, while in the US such a contract is forbidden by the right of first sale. The moral is that these things are less obvious than one would think.

The UK certainly has some weird laws, but that sounds...of dubious validity. Like roughly the equivalent of "not for individual resale"; a contractual matter between the supplier and the merchant, not something that could even theoretically be enforced on any buyer.

Re: Tesla reports first quarterly profit in more than three years

#82

Post by kbenson »

vkou wrote: post #55
loceng wrote: post #22

Earlier quoted context omitted.

The whole is greater than its parts. Tesla, to 'own' the ecosystem, needed to eventually offer what SolarCity has or there'd be a segment in their market they are catering to.

By that logic, what's really preventing Ford and Toyota from reaching true success is that they don't own any oil rigs. TSLA owning SCTY makes about as much sense as Toyota buying Exxon-Mobil, with a small helping of 'enormous conflict of interest.'

If ford and Toyota were marketing their vehicles to people that for the most part had substandard access to gas, or gas fluctuated enough that they were caught paying higher prices based on the time of day, they may very well have come out with accessories to deal with this, such as standard equipment tow-hitches on all cars and small gas trailers, so you could plan a trip to the gas station that might be a ways away, and for when gas is cheap.

We don't generally have that problem in the US thought, and places where that might be useful are dwarfed by the markets it's not at that point, so it doesn't make sense. Otherwise, yes, that would be a big missed market opportunity for car companies. A chance to sell more stuff, and put it all under the same financing.

That is, the difference between Tesla and the ICE automakers is that one of them has a resource (fuel) distribution problem that was already solved a long time ago, and one doesn't. That necessitates different strategies.

Re: Tesla reports first quarterly profit in more than three years

#83

Post by matt4077 »

rascalpenguin wrote: post #14

I imagine this is because the majority of revenue is spent on growing the buisness, rather than going into profit (As profit = revenue - expenses). As Tesla still has a lot more space to grow. Same method Amazon did until recently for years.

Yes, but note that a lot of investments can be made without reducing profit.

"Expenses", in this sense is not "cash out". When you buy a building, you're just moving value from one store to another (cash -> assets). Only the deprecation (something like 5% p.a. for a building) has an impact on profits.

(although, for technology companies, investments often hurt profits more than for more traditional companies, mainly b/c typical tech investments are hard to value accurately and therefore deprecate immediately or faster – self-created IP as one example)

Re: Tesla reports first quarterly profit in more than three years

#84

Post by jeffwilcox »

balls187 wrote: post #74
tw04 wrote: post #58

Earlier quoted context omitted.

No, but I can imagine a BMW owner complaining that the 2016 model came out 3 weeks after he bought his 2015, with no notice from BMW, the sales guy, or the press. And that the 2016 model came with a bunch of new features he really wanted and would've been willing to pay for.

Doesn't BMW update models roughly on the same schedule every year?

Yes, the manufacturing gets reset with very minor updates, but nothing too major.

It's tough because if you are custom ordering a car mid-year there's a question as to whether to wait for a production allocation in the new model year or not.

Re: Tesla reports first quarterly profit in more than three years

#86

Post by reneherse »

vkou wrote: post #55
loceng wrote: post #22

Earlier quoted context omitted.

The whole is greater than its parts. Tesla, to 'own' the ecosystem, needed to eventually offer what SolarCity has or there'd be a segment in their market they are catering to.

By that logic, what's really preventing Ford and Toyota from reaching true success is that they don't own any oil rigs. TSLA owning SCTY makes about as much sense as Toyota buying Exxon-Mobil, with a small helping of 'enormous conflict of interest.'

Right, because then Ford could sell you a backyard oil well and refinery to fuel the Focus parked in your garage.

Re: Tesla reports first quarterly profit in more than three years

#87

Post by mikeash »

cortesoft wrote: post #65
fweespeech wrote: post #40

Earlier quoted context omitted.

Per-unit margin goes down (but is still profitable per unit) but you make up in volume to create a profit. Tesla's main costs aren't the cost per unit but the engineer/software costs iirc.

If they make more profit by selling more units at a lower price... then why don't they always just do that?

Building lots of cars is hard. It takes a lot of time and money to ramp up production capacity to this level. They've been building cars as fast as they could for years now.

Re: Tesla reports first quarterly profit in more than three years

#88

Post by Anasufovic »

tw04 wrote: post #68
eanzenberg wrote: post #62

Earlier quoted context omitted.

You sure? Cause in this analogy, the 2015 model was at a serious discount while the 2016 has no discount at all.

I'm sure. It's one thing to be told "Hey, there's a new model right around the corner. But we have this guy on a steep discount to clear out inventory." vs. "Hey, we have this great sale going on. What, new model? Naww, we are just having a sale!!" The incumbent MFG's literally have "new inventory" sales on their last-years model to clear out inventory. They let you know well in advance that a new car is coming with…

I think we know which path leads to better sales.

Re: Tesla reports first quarterly profit in more than three years

#89

Post by samfisher83 »

mitchellh wrote: post #23

Really great news! But something that shouldn't be overlooked is the discounts they gave in Q3 to push deliveries up. First, those that know me know that I am a Tesla FANATIC. My girlfriend once challenged me to not talk about Tesla (motors, energy, something) for a 24 hour period. I dunno if I've ever done that honestly. I'm also an owner (no surprise given my fanaticism, lucky to be able to afford one). And I also…

If that was the case why did their gross margins also go up?

Re: Tesla reports first quarterly profit in more than three years

#90

Post by mikeash »

antimatter wrote: post #30

One thing to note, I have a few friends who work at Tesla service centers. They cut A LOT of corners when it comes to service to show profits this quarter. For example, for the location that one of my friends works at (which happens to be one of the busiest locations in Southern California), they sold almost every single loaner vehicle as a used car.

I'm pretty sure they do that every quarter. It's pretty well known in the owner community that loaners might be hard to come by around the end of the quarter.
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