Musk Says Tesla ‘Dug Our Own Grave’ With The Cybertruck

[JeffKeryk]

Comparing Tesla with legacy car companies is apples to oranges in many ways. Old skool vs new skool. Legacy struggles with change and depends on loyalty; they live and die by their truck business. Change is the only constant and change is difficult for them. "The big boys" have never made a nickel on their EV business; quite the opposite. Their EV endeavors are losing billion$. For awhile GM lost $9K on every Bolt; Ford loses billions on the Lightning. In business we say, "You grow or you go." With scattered factories, change is a logistics nightmare. Costly and difficult.

Tesla embraces change and is the most efficient car company in the world. They are in rapid growth mode. Their margins are the envy of the industry. Name another car company the market holds to 50% YOY growth. The big difference? Tesla is a technology company that happens to make cars.

Tech is a roller coaster. In the middle 1990's, when the IBM PC revolutionized business, Apple was sure to be a goner. The key tech characteristic is reinvention. You grow or you go.

How many of us even imagined Tesla would own the charging stations? A few months back it was believed Tesla needed to change yet the opposite came about. During the pandemic, the chip shortage crippled everyone except Tesla as they were able to repurpose available hardware by recoding firmware. Tesla practices vertical integration of critical components; others rely on suppliers.

What does the future hold? Your crystal ball is as cloudy as mine. I am, however holding on to my stock. Shoulda bought stock instead of the car! Dang crystal ball...

 

[Dave Hess]

Tesla is a good company that will have a union within 3 years.

 

[97prizm]

Or not - think stealth !!!

Let me get this straight...

Tesla's sales are up 41% year-over-year.

Tesla Model 3 Sales are up 15%. It's the highest grossing and most profitable car globally.

Tesla Model Y sales are up 80%. It's the highest grossing and most profitable SUV globally.

Tesla has higher margins than any other automaker on the planet.

They have no pension or retiree benefits to pay.

They have no dealer network to support.

They have no unions to hamper their production lines.

No floorplans to dole out to third parties.

No advertising.

No legacy suppliers that use different programming languages or assembly techniques that massivley complicate the mass production of EVs.

No ICE development that distracts from their sole focus on EVs.

To be brutally blunt with you, I just don't get where your angst is coming from. This company was not the lobbyist driven force that is harming the auto industry. To figure that one out, you need to focus on those automakers who never paid off Uncle Sam, or received large grants in the billions to stay afloat.

Those would be GM, Ford, and Stellantis. From tens of billions in loans and grants, to the Cash 4 Clunkers debacle and an EV program designed to mint them money, they were given massive subsidies and still lost to their overseas competition.

They went from leading the car market to leaving the car market. From selling EVs to cancelling EVs. If you invested in the eight largest automakers back in January 2011 when the economy at its absolute worst, you would have invested in companies that made over a trillion dollars during the largest economic expansion in global history and yet, your return would have been less than zero.

As for Tesla, they are now worth more than all of those automakers combined.

When a company has their competition create all the rules of engagement, and still beats them into a fine red mist, you ought to be looking at the facts and data. Tesla is in a dominant position because they have earned it. That's the reality.

Without the carbon offset credits Tesla would have filed bankruptcy years ago. Musk himself as have many investors have mentioned this. Again my issue is musk is a hypocrite. He has repeatedly said that "Subsidies should go away." Great then Tesla can quit taking them, and hand back the billions plus interest.

 

[97prizm]

Tesla is a good company that will have a union within 3 years.

This! There's a huge push at the Freemont plant that is gaining traction quickly.

 

[E365]

Comparing Tesla with legacy car companies is apples to oranges in many ways. Old skool vs new skool. Legacy struggles with change and depends on loyalty; they live and die by their truck business. Change is the only constant and change is difficult for them. "The big boys" have never made a nickel on their EV business; quite the opposite. Their EV endeavors are losing billion$. For awhile GM lost $9K on every Bolt; Ford loses billions on the Lightning. In business we say, "You grow or you go." With scattered factories, change is a logistics nightmare. Costly and difficult.

Some things just don’t work out. That applies to every company, including Tesla. Wouldn’t it be fair to also cherry-pick parts of Tesla that aren’t working too, instead of looking at the company profits as a whole?

There’s zero evidence Model S or X ever made any profit. Tesla didn’t start making a profit until well into the era of the Model 3, and especially Y.

They're over 10-years deep into the Cybertruck idea and it hasn’t brought in a penny. Roadster 1 only lost money. Roadster 2 has essentially only lost money (they can’t keep those deposits forever). Semi has only lost money.

 

[JeffKeryk]

Some things just don’t work out. That applies to every company, including Tesla. Wouldn’t it be fair to also cherry-pick parts of Tesla that aren’t working too, instead of looking at the company profits as a whole?

There’s zero evidence Model S or X ever made any profit. Tesla didn’t start making a profit until well into the era of the Model 3, and especially Y.

They're over 10-years deep into the Cybertruck idea and it hasn’t brought in a penny. Roadster 1 only lost money. Roadster 2 has essentially only lost money (they can’t keep those deposits forever). Semi has only lost money.

I don't have numbers, but the S and X are profitable. But only about 5% of Tesla revenue. They recently raised the price of the Model X, I believe. Regardless, they are getting long in the tooth, Plaid Supercar or not...

Spot on; Tesla did not become profitable until 2020. This is typical for a start up.
You may want to read Musk's Secret Plan penned in 2006.

What I was referring to was the Big 3's EV ventures. We have heard "Wait till the Big Boys get in" for some time. Thus far they have failed. The assumption that legacy car companies could step in and take the EV market from snotty nosed new kid Tesla has proven to be a bad assumption.

 

[dishdude]

Tesla is a good company that will have a union within 3 years.

It'll be a good company once Musk is sent on a one way rocket to Mars.

 

[Skippy722]

Without the carbon offset credits Tesla would have filed bankruptcy years ago. Musk himself as have many investors have mentioned this. Again my issue is musk is a hypocrite. He has repeatedly said that "Subsidies should go away." Great then Tesla can quit taking them, and hand back the billions plus interest.

In 2022 they made $81.4 billion in revenue, $1.8 billion of which was carbon credits. I think they’d be okay without it.

 

[97prizm]

Some things just don’t work out. That applies to every company, including Tesla. Wouldn’t it be fair to also cherry-pick parts of Tesla that aren’t working too, instead of looking at the company profits as a whole?

There’s zero evidence Model S or X ever made any profit. Tesla didn’t start making a profit until well into the era of the Model 3, and especially Y.

They're over 10-years deep into the Cybertruck idea and it hasn’t brought in a penny. Roadster 1 only lost money. Roadster 2 has essentially only lost money (they can’t keep those deposits forever). Semi has only lost money.

Especially since musk seems to think strapping rockets to it are a great idea.

 

[4WD]

I don't have numbers, but the S and X are profitable. But only about 5% of Tesla revenue. They recently raised the price of the Model X, I believe. Regardless, they are getting long in the tooth, Plaid Supercar or not...

Spot on; Tesla did not become profitable until 2020. This is typical for a start up.
You may want to read Musk's Secret Plan penned in 2006.

What I was referring to was the Big 3's EV ventures. We have heard "Wait till the Big Boys get in" for some time. Thus far they have failed. The assumption that legacy car companies could step in and take the EV market from snotty nosed new kid Tesla has proven to be a bad assumption.

I’m not sure what your source is - but can’t imagine a positive prediction for the big 3 on this site …

 

[JeffKeryk]

I’m not sure what your source is - but can’t imagine a positive prediction for the big 3 on this site …

Ford
GM
I have not seen numbers for Stellantis; I believe they do not break out EV financials.

The Musk Plan was referring to Tesla starting with expensive cars as a learning process with the goal of an every-man's car.

 

[DwightFrye]

This particular section of BITOG is for the discussion of Electric Vehicles. Some of the points debated here would be better served if people focus just on the EV's that are being produced by the major manufacturers.

It is pretty much irrelevant who the biggest automakers were for the last 100 years and how many cars that they sold and what their overall profits were. The only thing that is remotely related is if the legacy automakers are making enough profit on their ICE vehicles to be able to fund the development of competitive EV's. Profit margins on ICE vehicles from Ford and GM are slim. Their EV's are major financial drains upon the companies.

At this moment, only Tesla is profitable with vehicles in the EV category. And their profits are in some cases many times what other makers are realizing on their ICE vehicles. As the EV category gradually grows the outlook for the legacy automakers to be competitive is pretty dismal. Sure, they will continue to survive selling ICE vehicles for a while. But they simply lack the resources in the way of needed capital and engineering talent to catch up to Tesla.

Maybe VW and Toyota will give Tesla some much needed competition. GM and Ford ? I wouldn't bet on them.

 

[alarmguy]

This particular section of BITOG is for the discussion of Electric Vehicles. Some of the points debated here would be better served if people focus just on the EV's that are being produced by the major manufacturers.

It is pretty much irrelevant who the biggest automakers were for the last 100 years and how many cars that they sold and what their overall profits were. The only thing that is remotely related is if the legacy automakers are making enough profit on their ICE vehicles to be able to fund the development of competitive EV's. Profit margins on ICE vehicles from Ford and GM are slim. Their EV's are major financial drains upon the companies.

At this moment, only Tesla is profitable with vehicles in the EV category. And their profits are in some cases many times what other makers are realizing on their ICE vehicles. As the EV category gradually grows the outlook for the legacy automakers to be competitive is pretty dismal. Sure, they will continue to survive selling ICE vehicles for a while. But they simply lack the resources in the way of needed capital and engineering talent to catch up to Tesla.

Maybe VW and Toyota will give Tesla some much needed competition. GM and Ford ? I wouldn't bet on them.

They are all vehicles and they all are more than remotely related.

Your cherry picking data to fit Tesla. Actually almost make it sound like they were doing well all these years when their first real profit was only in 2021 before that they lost money for more than ten years as a company. In that profit I hear no one telling me how much came from their non EV businesses because it doesnt matter even if they are not EVs.

Yet you're not disclosing the legacy automakers have slashed Tesla market share of EVs by a huge margin, nor mention that Tesla has slashed their profit margins by the boat load. Many times its brought up Tesla is a technology company, actually you stated it as well. So make sure, according to your statement you remove any profits (which are mostly a flop) from their energy storage business and solar panel business since it's not related to EVs right?

So is other vehicle makers who are doing it better bydeveloping EVs while still showing profits bad?? no.
This is an open forum and it's all factual data, including if EV sales are going to flatten out, how much price cutting is taking place with Tesla and the loss of market share, all mentioned automakers produce EVs and the bottom line profit to the shares holders is what counts, not what vehicle is most profitable and which one is least.

**Peace**

 

[alarmguy]

In 2022 they made $81.4 billion in revenue, $1.8 billion of which was carbon credits. I think they’d be okay without it.

81 billion in revenue is not profit

$1.8 billion in carbon credits is profit so over 10% of Tesla 2022 12.6 billion profit was from Carbon credits. That is pretty significant and I didnt even know it until I saw your post.

 

[97prizm]

This particular section of BITOG is for the discussion of Electric Vehicles. Some of the points debated here would be better served if people focus just on the EV's that are being produced by the major manufacturers.

It is pretty much irrelevant who the biggest automakers were for the last 100 years and how many cars that they sold and what their overall profits were. The only thing that is remotely related is if the legacy automakers are making enough profit on their ICE vehicles to be able to fund the development of competitive EV's. Profit margins on ICE vehicles from Ford and GM are slim. Their EV's are major financial drains upon the companies.

At this moment, only Tesla is profitable with vehicles in the EV category. And their profits are in some cases many times what other makers are realizing on their ICE vehicles. As the EV category gradually grows the outlook for the legacy automakers to be competitive is pretty dismal. Sure, they will continue to survive selling ICE vehicles for a while. But they simply lack the resources in the way of needed capital and engineering talent to catch up to Tesla.

Maybe VW and Toyota will give Tesla some much needed competition. GM and Ford ? I wouldn't bet on them.

Tesla has lost market share and profit margins. Not only this but five years ago 96% of Tesla owners surveyed would buy another Tesla. Now it's 62 percent. All the Musketeers will tell you all is well in Elonland but from my basic math a 34% reduction in repeat customers in five years is bad.

 

[OVERKILL]

But they simply lack the resources in the way of needed capital and engineering talent to catch up to Tesla.

So your argument is that the companies that have brought us Corvette and the Ford GT lack the engineering resources to produce a vehicle with all the quality and comfort of an 80's J-body, but with an electric drivetrain?

Perhaps they've just been going about this all wrong, trying to make something nice, when they should just be making something fast and cheap.

Maybe VW and Toyota will give Tesla some much needed competition. GM and Ford ? I wouldn't bet on them.

Toyota's recent foray into the EV space has been anything by spectacular. VW may be able to get the mass production angle right, and they don't appear to be trying to do excessive luxury.

BMW also has a few nice offerings in this space now, and they are certainly my favourite based on my test drive experience. The ride, NVH and materials selection are all well executed and what one would expect at that price point, all of which were major disappointments for me with the Model 3.

 

[97prizm]

81 billion in revenue is not profit

$1.8 billion in carbon credits is profit so over 10% of Tesla 2022 12.6 billion profit was from Carbon credits. That is pretty significant and I didnt even know it until I saw your post.

Thank you. This is why I despise musk. He repeatedly wants to "end subsidies for corporations" yet I don't see Tesla declining handouts.

 

[97prizm]

So your argument is that the companies that have brought us Corvette and the Ford GT lack the engineering resources to produce a vehicle with all the quality and comfort of an 80's J-body, but with an electric drivetrain?

Perhaps they've just been going about this all wrong, trying to make something nice, when they should just be making something fast and cheap.

Toyota's recent foray into the EV space has been anything by spectacular. VW may be able to get the mass production angle right, and they don't appear to be trying to do excessive luxury.

BMW also has a few nice offerings in this space now, and they are certainly my favourite based on my test drive experience. The ride, NVH and materials selection are all well executed and what one would expect at that price point, all of which were major disappointments for me with the Model 3.

My dad rented a model y for the week back in October for my sister's wedding. Terrible ride quality, wind noise was no better than my parents Subaru Impreza. The interface should be banned as having to use a screen for everything is stupid. Why people keep putting this company on a pedestal is beyond me.

 

[alarmguy]

Tesla is a good company that will have a union within 3 years.

It's going to be interesing. I think the problem with the UAW and why their membership is at an all time low is the non union automakers have learned the "magic formula".

That formula is to pay close attention to the UAW agreements and quickly implement the significant parts most important to the workers and their staff.
So non union autoworkers are getting pay and benefit increases like crazy right now to keep their members happy and vote no at the next union vote.
At the same time, the crazy unrealistic stuff that workers are not concerned with allows the non union company to operate, open and close plants, chose suppliers on price etc/ in the best interests of the company.

More or less, workers are fine with leaving decisions to the company operations with the executives just give the workers the pay and benefits that align with the UAW.

 

[JeffKeryk]

Tesla has a giant lead in EV market share at 50% or more. Tesla margins are the envy of the automobile industry.
If that's bad, then what do you call losing billion$ on your EV business? Or margins of any car that are half (or less) than Tesla's?

Asking for a friend...