There is absolutely zero change Tesla will deliver 300,000 Model 3s in 2018. 3,000 perhaps, if they're lucky.

 

@Paul Ellison My sweepstake guess would be 150k. All US bound cars, with maybe a handful of LHD reaching EU by year end.

 

Not bad. Around 10 times as many as the iPace.

 

And that’s why I am picking up my CPO S tomorrow!

 

The issue for Tesla isn't whether they are still getting product out from production jigs or not, the real question is how long they can keep burning money like that because there is very little chance they are making anything but a big loss on each car doing that.

If it was profitable to hand make cars out of prototype tooling then we would see lots of cars made this way.

While they burn money rather than focus on delivering solid manufacturing techniques then they put themselves at ever greater financial peril.

......Just out of interest, what happens to the £1000 deposits if Tesla go bust?

 

Everyone loves to state that Tesla don't make money on their cars, but don’t stop for a second to consider if Nissan, Renault or BMW are making money on their EVs.

 

Not really a fair comparison though, those other larger manufacturers are doing just fine with their ICE vehicles regardless of how well they do with EV.

 

They won’t be saying that when all that infrastructure and tooling becomes obsolete over the next few years.

I mean it’s not like ICE manufacturers ever needed a bailout...

 

BMW i3 was profitable at 20k units, they passed 30k units in 2015

 

You’re not including R&D and tooling costs in that are you?

 

Way of the world, people more excited and interested in ‘fails’ than accomplishment.

I trust Tesla & Elon, even if I did ever lose my deposits I wouldn’t mind because at least Elon and his team are trying to do the right thing.

We as a planet should be supporting forward thinkers, people who are pushing the boundaries and trying to right some wrongs.

Have no idea why some people are so tied up in their own misery that they want to drag the good people down.

 

You could say the same about Amazon for most of its history.

I do rather enjoy the share holders supporting the discounts on my purchasing ;P

 

I think you’ll find it’s all the P100D owners who subsidise your purchase.

 

I just thought people must be bored of all the doom and gloom stories by now - because they are essenitally the same circular argument, just replace the letter 3 with X or S, and infuture Y.

Instead can I say am really looking fowards to the 3 - when ever ours arrive. Virtually the same rear passenger space as a bench seat in a 5/7 seater X despite been alot smaller inside. Looks like one practical family car too me .

 

I just thought people must be bored of all the doom and gloom stories by now - because they are essenitally the same circular argument, just replace the letter 3 with X or S, and infuture Y.

On the contrary, this is the single most critical moment for Tesla which they have not experienced previously.

It is a unique step for Tesla which will either make or break them.

They have now to ramp up to mass production, to deliver a quality product at a budget price.

If you think that is a trivial step further than hand-making expensive niche cars that are fat with profit margin, then you don't really have a grasp on the commercial significance of that.

If they make a product with a single major defect involving a mass recall, it could wipe out their entire profit margin and damage their reputation, possibly bankrupting them.

They have to now do what traditional manufacturers do, set up the lines, lock down their processes and those of their suppliers, and make darned sure there aren't any major defects either in the design or introduced along production, keeping tight reign on their production 'control limits'.

 

@cah197 Amazon and Tesla are wildly different.

Setting aside cash flow and self funding, you only have to look at the recurring revenue stats.

Tesla may be lucky and sell the same owner a car on average every 3 years. Amazon can count on subscription revenues almost guaranteeing their customer base buys month in month out, and even those who don't subscribe to some form of service are hugely likely to be repeat customers multiple times per year. Give such vast numbers of transactions it's statistically predictable with large confidence what future revenue will be.

Sorry I just don't see any similarities in the business model. (I might if Tesla could monetise charging, servicing or connectivity subscriptions.)

 

Sorry I just don't see any similarities in the business model. (I might if Tesla could monetise charging, servicing or connectivity subscriptions.)

Their detailed business models of their various businesses are undoubtedly different, but I think the comparison being drawn is that Amazon and their investors have been happy to forgo the possisbility of building a stable, profitable business of modest size in favour of repeatedly doubling-down on their bets to build an ever bigger conglomerate dominating multiple markets - "growth is more important than profit".

Of course, the dotcom boom provided plenty of examples of how this can lead to spectacular failure.

Although I think the comparison is fairly clear, I'm not sure what conclusion that helps with, other than that Tesla is likely to be either a spectacular failure or continue as they are (I haven't studied Amazon's recent financials, but my understanding is that they are still going for growth rather than profit, 20+ years on).

 

Our X is probably one of the most complex mass produced cars on the road. Can anyone else think of a car with powered front doors, powered gull wing doors, AP hardware, massive windscree, powered 2nd row seats? I don't see Mercedes/BMW etc offering anything remotly close let alone electric powered.

Despite all the doom sayers ive yet to actually read about one actually suffering a failure of the doors.

The Model 3 is infinitely simpler to excute, and as @Edd Beesley points out Teslas continued success is 100% crucial to EV adoption. I for one is happy to put my money into Tesla products and will continue to do so untill the day EVs become turly mass market.

Driving home today I saw exactly 0 EVs, and probably over 100 combustion cars. The future of EVs is far from secure, I cannot understand how any who actually want EVs to succeed want Tesla to fail.

 

A few 10's of thousand of vehicles is called 'serial production' in the industry. It is too small a volume for most 1st tier suppliers to even bother developing product for, because the volumes needed to make competitive automotive components is usually a few million.

Moving to 10,000 a week is not simply 'a bit more, like model S'.

Hey, no-one's knocking Musk for having a go, and good luck to him. But they need to start making profit soon, and using validation fixtures to make stuff on isn't a path to that conclusion. I hope more time on those jigs helps them iron out more issues than going straight to the high volume line, so maybe it might even be a good thing. Maybe even it was the intention.

 

What if his intention was never to make a profit just to make EVs happen? And he will just keep going as long as he can?

Musk does not really strike me as a man who is interested in making money, he has had more money than he could ever personally need since his bizarre early software success (not to mention his family is also rather wealthy).

If people do eventually figure this out and the investment dries up well by then the rest of the world is going to be far enough along with EVs for it not to matter.

 

Exactly. Every quarter of Ford trying to build a “Tesla killer” is a good quarter.

 

What is the purpose of Tesla?

Is it to make money?

I don’t think it is.

Depends on "who" is making the money.

Plenty of Elon's relatives are rich beyond most of our wildest dreams on the back of serially money losing enterprises.

If, as many portray Tesla, the idea is to save the planet, then it should have been set up as a charity/ NFP from day one.

 

I think the Tesla view is that a large part of the global energy economy will shift from burning carbon to consuming electricity generated by renewables.

There are are a number of areas in the emerging renewable economy that offer companies the opportunity to build profitable businesses:
- renewable generation infrastructure
- large scale production of batteries
- storing excess renewable generation (energy trading, buy when cheap and sell when expensive)
- electric vehicles
- electric vehicle charging infrastructure

Tesla have “skin in the game” in all of these. It’s nice for Tesla to be able to say that they are working in an area that is seen as environmentally friendly but really they are just trying to be a first mover in an inevitable change.

Although the change is inevitable, it requires enormous capital expenditure which rules out any type of charitable organisation. Only limited liability companies have the ability to drive this type of economic activity.

 

I agree with the comments about Tesla being in a critical phase and burning cash at a hell of a rate to get the Model 3 into production. I don't however regard the Daily Kanban as a reliable source of information on progress though - if I remember correctly that's where the Tesla Deathwatch came from along with predictions the Model S would never be made apart from a few hand-built prototypes.

Tesla may well fail - the history of companies challenging the incumbent auto industry gives plenty of evidence to suggest it - but I think the likelihood is lower than it's ever been before. They may over promise but they do have a history of delivering and I honestly think the Model S is the best car I've ever experienced in lots of ways. I've no real experience of the Model X but everyone I've spoken to with one is over the moon with it so I'll defer to @gzoom's viewpoint there.

 

I don't however regard the Daily Kanban as a reliable source of information on progress though - if I remember correctly that's where the Tesla Deathwatch came from along with predictions the Model S would never be made apart from a few hand-built prototypes.

Will you trust Elon's own words then:
Elon Musk on Twitter

 

I don’t think anybody who shares some concern about the future of Tesla wants them to fail, at least that isn’t what I’m reading.

I think the main risk for Tesla right now is that Mr Musk gets bored with the whole thing before the M3 is up and running, and before investors get their money back.

Now, when is this trip to Mars, and will it be a Tesla production rocket or a hand built prototype?

Is the reason for the Tesla EV business really to off set emissions from space travel?!

 

I don’t think anybody who shares some concern about the future of Tesla wants them to fail, at least that isn’t what I’m reading.

I think the main risk for Tesla right now is that Mr Musk gets bored with the whole thing before the M3 is up and running, and before investors get their money back.

Now, when is this trip to Mars, and will it be a Tesla production rocket or a hand built prototype?

Is the reason for the Tesla EV business really to off set emissions from space travel?!

The latest BFR rocket runs on O2 and CH4, which can be synthesised from electricity and water. So at least the fuel could be from renewable sources.

 

Will you trust Elon's own words then:
Elon Musk on Twitter

He certainly is in the know rather than speculating and while his timing is usually crazily optimistic what he says usually comes to pass, so I would say yes! I think he probably ought to think more carefully before tweeting, but his approach is a refreshing change and I do regard Tesla and Space X as seriously disruptive. It's not surprising they engender so much hatred!

 

Will you trust Elon's own words then:
Elon Musk on Twitter

Plainly there are delays (was there really anybody inside or outside Tesla who thought there wouldn't be?).

However, Daily Kanban's allegation is that these delays are structural, that there was no possibility of the original numbers being met even if everything had worked first time, and current deliveries are 'fake' in the sense of being hand-built with non-production tooling.

It does look like Daily Kanban has found out some interesting info - that Tesla are subcontracting body panel manufacturing initially (presumably one of the things Tesla did when they said they were accelerating the Model 3 ramp compared to original plans).

However, Daily Kanban then goes on to make some very negative speculation. Nothing in what they have found says that the subcontractor isn't already delivering panels to Tesla, or that supply of these panels is one of the "bottlenecks" delaying production (it might be, it might not - their info doesn't seem to indicate one way or the other).

 

Another article that has a click bait title.

The fact their outsourcing panel production isn’t a surprise and it even states that the production will be moved over to Fremont sometime in 2018. Again not surprising as they seem to have run out of space at the moment.

 

Oh look, Daily Kanban continue to embarrass themselves:

The indignity! Tesla Model 3 could be out-produced by “fuel cell” Mirai this year - DailyKanban

 

Failing in the USA is usually a good thing. Tesla has (apparently) burned through USD14B so far. Failure would simply mean filing for Chapter 11 bankruptcy protection the same as general Motors did in 2009. It took GM about 5 weeks to emerge. Their debts disappeared, the pensions issues resolved. No worries. Sure, the creditors, bond holders & shareholders got burned but a stronger company emerged. Happy days.
The thing about mass production is that if you throw enough people & money at it, mass production will be successful.
The bottom line is that even if Tesla fails, it is now too big to fail so it will re-emerge. These days, proper failure is reserved for small business owners. They lose absolutely everything including their dignity. If Tesla fails I am sure Elon Musk will still be highly respected as a business leader & a visionary. Maybe none of this is fair but this is the modern world we live in. Whatever may happen, the Tesla name & cars are not going away anytime soon..

 

Of course there is always Tesla Energy. The way that side of the business is growing, it wouldn't surprise me if revenue hit parity with Automotive sooner rather than later.

 

The more I look at Tesla the more I think it's wanting to ultimately position itself as a supplier of energy and all associated gubbins that also happens to make "premium" cars.

 

Also we must not forget the 3 is still very far from being an ‘affordable’ car especially as he is focusing production on the more expensive version initially. Tesla have a huge order book and it’s certainly not at Ford Fiesta prices. If they are making the car as simply as they say they are, then there will be sufficient profit margin per vehicle to keep the shareholders and creditors at bay.

Remember Tesla own the dealership network, so no profits are leaking to 3rd parties.

Also Tesla don’t negotiate. The list price is the price you pay. I would like to find anyone in the UK who has paid the list price for a Leaf or Zoe.

 

If Tesla fails I am sure Elon Musk will still be highly respected as a business leader & a visionary. Maybe none of this is fair but this is the modern world we live in. Whatever may happen, the Tesla name & cars are not going away anytime soon..

And now for something completely different