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by dave1619
3505 days ago
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(1) Tesla is aiming for 1 million cars in 2020. At an average price of $45,000/car ($42k for Model 3/Y but higher for Model S/X) that would be $45 billion a year in revenue. And they would still likely be growing fast at that point, with expansion in Europe and Asia. (2) Current gross margin is 25%, but is trending up as they scale Model X. Model S/X gross margin is likely going to be 30% within a year. Tesla is targeting a gross margin of 25% on Model 3. This gross margin is excluding ZEV credits. Tesla will soon use up the federal tax incentive ($7500 going to buyer) as they pass their 200,000th car sold in the U.S. But they still will have state and ZEV incentives that aren't depending on the federal government. There is risk with the new administration possibly delaying Tesla's autonomous driving plans. (4) For cash flow analysis, look at Tesla's most recent Q3 financials. It was a breakthrough quarter, as they are selling 25k cars/quarter (100k cars/year run rate). Financials show that S/X gross profit now covers all operating expenses. And when you deduct depreciation expenses and stock-based compensation, Tesla is actually cash flow positive by a large amount (over $400M just last quarter). They used some of that cash for capex, but still have over $100M left over. Tesla's finances have turned a corner, and they look very positive. For Solarcity, they had good Q3 earnings as well. Looks like Solarcity will not impact cash flow for Tesla in Q4 as Solarcity look to be cash flow positive in Q4. Next year, Solarcity's cash flow is projected to be neutral. |
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3) accurate
4) Model 3 will be very capital intensive, especially in light of unforeseen problems such as recalls, competition (unlikely in the near term), and consumers opting to get the base model instead of the decked out one. I don't pay attention to solarcity, but generally have mixed vibes about the company. SpaceX, on the other hand, has very positive prospects IMO.