A Skeptical View of Tesla
On April 2, 2020, Tesla announced its Q1 global deliveries, the day after many other OEMs had announced their U.S. Q1 sales, which was the proverbial ocean of red ink, with overall sales being down by double digits (or high single digits, as in GM’s −7.1%).
Tesla was expected by analysts to be on the order of about 77,000 vehicles.
Musk had been bloviating about ventilators that turned out to be the types of machines that you hear commercials about (“This CPAP machine is so easy to clean that you won’t believe it!”) and such like. Perhaps he was distracted because he wasn’t pumping the Model Y that is slowly making its way out into the market as of this quarter. (Production for the Model Y started in January and deliveries in March.)
The Tesla Model Y. Launched in January and deliveries started in March. (Images: Tesla)
Would it be possible that finally the dreams would come true of the seeming army of Tesla shorts and they would be vindicated?
Well, you know how the Road Runner always seems to slip by Wile E. Coyote and leave him flummoxed?
Elon did it.
The company announced that it delivered 88,400 vehicles—Tesla’s best first-quarter performance ever.
The company produced 15,390 Model S/X and 87,282 Model 3/Y.
Montana Skeptic on Autoline After Hours
In what is something of a huge coincidence, on April 2 we had a man who goes by the handle “Montana Skeptic” on “Autoline After Hours.” Skeptic has on his Twitter description “Annoying Elon since 2016,” and is a writer of some renown among the anti-Tesla folk with an interest in finances on the website Seeking Alpha.
Joining “Autoline’s” John McElroy and me in talking to Skeptic is David Welch of Bloomberg Businessweek, who has a deep knowledge of the auto industry including Tesla (and in another coincidence, Welch had been at Munro & Associates’ facility earlier in the week with Sandy Munro walking him through some of the aspects of a Model Y that Munro has for purposes of benchmarking).
It should be pointed out that the Tesla Q1 numbers weren’t released until the very end of the show, so no one had a real sense of the accomplishment.
But be that as it may, Skeptic laid out a case for why Tesla has a failed business model and how the company is likely to be massively affected as other OEMs begin bringing electric vehicles to market.
Of course, given things like the fact that in 2019 there were 16,418 Chevrolet Bolt EVs sold and 158,925 Model 3s sold provides some pause.
Welch points out that as long as Tesla does well in the U.S. (mainly California) and China, where the Tesla Shanghai factory started producing cars a year after construction on the plant started, it should do just fine. The whole notion of a plant in Berlin, however, is something else entirely.
It is a very lively discussion, so if you have even the slightest interest in Tesla as a business rather than Tesla the car, then you won’t want to miss this edition of “Autoline After Hours.”
And you can see it right here.
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