Tesla/Lithium stocks discussion

Here's a fun highlight for Tesla and the claim "more cars will lower the losses" from their Q1 report.

GAAP loss	cars sold GAAP loss per car
1Q 2016	$282,267,000	14810	$19,059
4Q 2015	$320,397,000	17478	$18,331
3Q 2015	$229,858,000	11603	$19,810
2Q 2015	$184,227,000	11532	$15,975
1Q 2015	$154,181,000	10045	$15,349
4Q 2014	$107,629,000	9834	$10,945

The more cars they sell the more loss they make per car and while failing to deliver the June consensus target of 19.6k cars by only expecting 16k cars they believe they will be able to deliver 500k by 2018.

Best of luck to the believers who decide to buy into the hype.

Oh and for the model 3 deposit ownersTesla says "Thanks for paying the interest on our loans; we hope we'll not go bankrupt before you want to take delivery of the car".

Tesla press release wrote:

April cash receipts for vehicles in transit at quarter end plus Model 3 reservation deposits allowed us to pay back $350 million on the asset based line.

Sabre Man wrote: »

How is loss per car actually calculated? Where did you find those figures?

Their security filings listed on their site, here's Q1 2016 for example and scroll down to Net loss.

Oh and for those that missed it; this is a great line in their letter to shareholders:

Given our plans to advance our 500,000 total unit build plan,essentially doubling the prior growth plan, we are re-evaluating our level of capital expenditures, but expect it will be about 50% higher than our previous guidance of $1.5 billion for 2016.

So now they are going to spend $2.25 billion in pure CAPEX in 2016 alone from a company that posted Q1 losses of $282 million and stated it's going to get worse. Now they stated they hope to get 25% margin on their model X which is a premium model so let's give them 20% margin on the model 3 (and these are all pre-GAAP so actual margin is significantly lower, as a reference Porsche as the highest margin luxuary car company has 18% margin on their cars, Volkswagen cars are a 2.3% so think about that for a moment) and give the 500k cars @ 40k each (since they think everyone are going to buy upgrades). We have a pre-GAAP profit then of $1 billion. This means they need to sell half a million cars a year with 5k extras for three years only to recover the investment of 2016 alone (and that's before we start talking interest, write down on machines etc.); for those not aware 2017 is expected to have similar investments as well.

Please can someone tell me with a serious face they expect Model 3 to sell for 7 years straight at 500k a year (maximum capacity when they come out; not adding the CAPEX to go up to a million a year by 2020)? And that's just to break even on the equipment to build the cars; not including the costs for the actual materials, workers, design, sales force, recalls etc. Break even with everything included would require the model 3 to sell at maximum capacity for around 10+ years straight without ANY NEW COSTS.

I'm sure Musk will make money from his factory possibly but for the fools buying into Tesla stock? Sorry but this is puff puff pass kind of stock to me; not a single number shown to date on how this company will ever make a profit even at maximum production of an car for 10 years to cover existing costs and that's assuming they somehow magically managements to get these margins which to date they have never managed...

Sabre Man wrote: »

You're looking at it the wrong way. It doesn't say anything about loss per car. Tesla isn't losing money on cars sold, but is simply spending money building the company for future growth.

Tesla has never made a profit, ever. Not as a niche supercar company, not as a small car company and they are not going to make a profit trying to sell cheap electrical cars either. Not a single number presented to back it up, not a single economical prognosis by them has been achieved on margins or profits. All we have is vague hand waving that it will be possible in the future somehow somewhere. Tesla is simply Musk's way to get other people to pay for his dream of a future with electrical cars but that does not make a profitable or sustainable company.