My Takeaway and Views on Tesla Earnings Call Part 2
Good
When you look at the bad, do you notice something common in all of them? Think of it at the back of your head and I will reveal to you later. Now, let me share the Good.
1.8M Deliveries Goal achieved with production ramping
Tesla projected 50% growth YoY since 2018, using 2018 as the starting point. This is no easy goal as EVs take strong manufacturing capabilties and technology to be profitable. Look at $Ford Motor (F.US)$ who cut their production to 25% since 2023, $General Motors (GM.US)$ who struggle to make it profitable. Only Chinese EVs pose a strong challenge to Tesla. $BYD COMPANY (01211.HK)$ $XPeng (XPEV.US)$. Elon mentioned that Q4 production was at the runrate of ~2M cars annualised. More cars produced per day > lower labour costs per day / lower COGS per car / higher profit margin per car / higher EPS
Tesla Energy delivered 15 Gigawatt of batteries in 2023
Something you do not hear investors or Wall Street talk about is Tesla Energy. Today, most people think Tesla is just a car company. Tesla Energy delivered 150% more in 2023 than in 2022. Take note that Tesla Energy has a much higher profit margin than Tesla EV. Tesla mentioned that they are doubling their production capacities to meet their increased demand.
Best AI inference efficiency in the world
For those that do not know what is AI inference, it means the process of using a trained model to make predictions on never-seen-before data. This is to power FSD 12 and Optimus. AI inference is crucial because many Generative AI today can only do what they have been trained to do (take a look at ChatGPT and Bard AI). Looking at the first hand experiences of FSD 12, it was a significant improvement from FSD 11, with lesser code and higher reliance on neural network.
Next Generation Vehicle to start in H2 2025
Elon teased the new generation vehicle will be started in Houston to allow its engineers to be closer to the production lines. Additionally, they have been developing a new manufacturing capability to reduce the cost of this vehicle. Many speculate that it is a $25k vehicle but Tesla did not confirm. If it were to come true, it will open a new market to Tesla > higher revenue > higher earnings.
Improved Brand Awareness
Tesla acknowledged that they do not have the best brand awareness and many people still think they EVs cost alot. Top worries for EVs are cost, battery and maintenance. Tesla has been pumping out educational ads to target these fears in hopes of changing people’s perception on EVs. This is a good direction for Tesla to help people better understand EVs.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
Read more
Comment
Sign in to post a comment
Bringing actionable insights to a world of “professional” analysts
109Followers
39Following
452Visitors
Follow