Tesla Smashes Earnings And Revenue Expectations

http://www.businessinsider.com/tesla-q1-earnings-2013-5

by Pasanpr • 13 years ago

385 182 13 years ago

businessinsider.com

cryptoz• 13 years ago

TSLA is currently up 21%! Wow, and still climbing...

Edit: Flying past 27% in after hours trading.

jakebellacera2• 13 years ago

When a company gets press like this, the amount of volume increases heavily.

dusing• 13 years ago

Groupon is up 13% today

niggler• 13 years ago

Now TSLA is up 21% (67.90 last trade)

typicalrunt• 13 years ago

I've never seen the fairness of after hours trading. The majority of people don't have access to it (that I've spoken to), yet that is when you see some major moves (up or down) in a stock.

Congrats to Tesla for turning their first profit!

enraged_camel5• 13 years ago

From Wikipedia:

Trading outside these regular hours is not a new phenomenon but previously was limited to high net-worth investors and institutional investors like mutual funds.[2] The emergence of private trading systems, known as electronic communication networks or ECNs, has allowed individual investors to participate in after-hours trading.

In other words, nothing unfair about it.

adventured2• 13 years ago

The majority of investors can easily get access to after hours trading these days. A simple Scottrade account comes with the ability to trade after hours.

meric• 13 years ago

That's only because companies tend to release market sensitive information outside of trading hours. If you do it within trading hours, a trading halt must be in place. In which case, the major moves up or down of a stock is still outside of trading hours. Price changes are discrete, not continuous.

onedognight• 13 years ago

> The majority of people don't have access to it

Schwab supports after hours trading from their accounts.

3am3• 13 years ago

A couple of interesting statistics about stocks that are easily available are related to how many people are shorting it (ie, someone borrows a share, sells it, and makes a profit if they can re-buy it at a later date to close the short position).

In the case of TSLA the stock, as of Apr 15, almost 31 million shares were lent out to short sellers ("sold short"). That is out of 72 million shares on the market ("float"). At an average volume of 3 million shares traded per day (trailing 3 month average) it would take more that 10 trading days of nothing but short sellers buying shares on the open market to return to the people they borrowed them from ("cover").

Short trading unhedged is regarded as dangerous for this reason. If you buy a stock in the traditional way, if it goes to zero you only lose your investment. If you sell a share short, your losses (amount you have to re-buy it for minus the price you sold it for) is unbounded. Typically, this isn't collateralized by cash, but in money that brokers loan to traders ("margin"). If a broker sees that I have a really, really big loss on a short position, they might make me repay that money ("issue a margin call")... and depending on the situation, that might force a trader to cover their short position.

Anyway, point is that this can lead to a bunch of short sellers driving up the price of a heavily short stock all at once because they've either decided to cut their losses or because of margin calls, called a "short squeeze". This usually isn't sustainable because it's a temporary supply/demand imbalance. Could be an tough day for a lot of people investing against Tesla tomorrow, but I wouldn't bet on the gains in TSLA the stock tomorrow/in after-hours trading lasting for a long time.

enraged_camel5• 13 years ago

The most amazing thing about your post is that 95% of your post went right over my head. And I consider myself a fairly intelligent person. :P

(There's probably some interesting commentary in there somewhere about the complexity of financial markets and how it is probably bad for society to have a vast portion of our economic growth riding on something most people don't get.)

maxerickson• 13 years ago

It's more jargon than it is complexity.

Most people don't get electricity or internal combustion engines or computers or whatever, so that is kind of a scary standard.

3am3• 13 years ago

I'd be happy to try to explain anything. This doesn't even get into the little "unhedged" word's complexity :)

That's when you start getting into options and derivatives, which are (theoretically) priced on a 5 variable differential equation called "Black-Scholes" (intuitively, you are just buying the right to buy or sell a stock for a particular amount at or by a certain date in the future).

You could construct a trade using those where you would make a smaller amount of money if the price fell, but your losses would be capped above a certain amount. In investing terms, you could buy out of the money calls to hedge your short position, and then your loss would be capped at (price you sold - max(price you have to re-buy at, price you can call your options at plus the option premium). I'll stop there before I get too far out of my league :)

count• 13 years ago

Here's the gist, in simplified terms. I assume you understand what stock and stock brokers are...

You can 'short' a stock that you think is going to lose value (e.g. you expect a major earnings miss to be reported).

Shorting a stock means you borrow a share from (generally) your broker at todays price. You then sell that share to someone else for market price. At a determined date, you have to buy another share at market rate and give it back to your broker (this is called 'covering' your short).

If you bet right, you borrowed a share, and sold it for $N. Then, at a future date, when the price fell, you bought for $N-X, and gave the share back to your broker. You just made $X, the price difference from the value of the stock falling.

If you bet incorrectly, you borrowed a share, and sold it for $N. Then, at the future date, the price is actually higher, and you have to buy a share at $N+X, AND give the share back to your broker. You just lost $X, the price difference from the value of the stock rising.

If you bet REALLY wrong, the $+X factor can get really high - your broker may 'call' and force you to give them cash, pending your future purchase of the share to return (your 'cover').

Now, to MOST people, shares are effectively unlimited - with tens of millions or more shares on the market for most traded firms, liquidity isn't an issue. If you want a share or a few shares in a company, it's pretty easy to get them. What may or may not be happening here, is that a TON of folks are currently 'short' on Tesla's stock, meaning millions of folks are going to HAVE to buy shares of the stock to 'return to their broker' and cover their short. The problem is that Tesla DIDNT go down.

Normally, lots of folks are short on lots of stocks, and the market just moves. Occasionally, you get a confluence of events which leads to there being a high demand for a stock that a large number of shares are shorted on, which has a self-feeding pain cycle: the stock price is based mostly on demand and liquidity - as more and more folks HAVE to buy the shares to cover their shorts, the demand for the stock is going to go up, and thus the price is going to go up as well. This increase in price increases the pain, and triggers many brokers to 'call' those margins, requiring MORE people to buy the stock to cover, driving the demand up even higher. The end result is a big spike in the price of the stock, and a TON of people losing money on their bad bets.

brc• 13 years ago

>There's probably some interesting commentary in there somewhere about the complexity of financial markets and how it is probably bad for society to have a vast portion of our economic growth riding on something most people don't get.

Not really. Financial markets day-to-day operations don't really affect peoples real-lives. Every industry is full of terminology and jargon that describes the inner workings but that isn't necessary to understand for the outsider.

The average person with a retirement fund just wants to see it keep and increase in value over time. They don't particularly care if the traders of that fund were losers/beneficiaries of a short squeeze on a segment of their portfolio, as long as the overall value keeps going up.

Kind of like how the average web visitor doesn't care what OS and database a site runs as long as it is fast and bug-free.

PakG12• 13 years ago

but I wouldn't bet on the gains in TSLA the stock tomorrow/in after-hours trading lasting for a long time.

Depends on the future performance of the company. Netflix experienced one of these short squeezes in January. Look at their 6 month chart.

http://finance.yahoo.com/echarts?s=NFLX+Interactive#symbol=n...;

brador• 13 years ago

What caused that huge 80 point gain in feb?

cloudwalking3• 13 years ago

This is the first of many profitable quarters for Tesla. The Model S is a better car in every single regard (except for range), than any other car on the market. It is safer, faster, roomier, more fun to drive, has more storage, quieter, more convenient, and less polluting.

Electric vehicles will displace combustion vehicles. Everything that makes a car, the electric car does better.

Right now the electric vehicle market is small, but soon (one decade?) it will eclipse the combustion market. Tesla is ahead of ALL other vehicle manufacturers, and that lead will translate into significant market share. As the electric vehicle market grows, so will Tesla's value.

mrchucklepants2• 13 years ago

Everything but engine sound. I will miss the deep, throaty growl of a large V-8.

stdgy• 13 years ago

In the future, I suspect we'll see aftermarket outfitters touting externally facing audio equipment to imitate the sounds produced by high-powered combustion engines.

I also suspect the majority of them will be sold to teenagers with fairly under-powered vehicles ;)

timdorr2• 13 years ago

Closest you'll get is turning on the AC. Because the car's so quiet, I can hear (and feel) the rumble of the compressor running when I turn down the temp in the car.

EvanKelly• 13 years ago

Did you mean to qualify your first statement by saying "electric car"?

rdl9• 13 years ago

Motor Trend didn't, so I don't see why he would. There are specific non-EVs which beat the Tesla on specific things, but nothing which beats the whole package, regardless of drivetrain.

(Well, Tesla towing capacity is kind of crap I think, and it would be a poor choice if you street parked, drove to a far away location without superchargers enroute, etc.)

mikeash• 13 years ago

Range and price, both of which are pretty important, especially the second.

whatusername2• 13 years ago

Hyperbole much? The model S is a great car. It has a great combination of features. But aside from maybe its dashboard -- I can't think of a single attribute where there isn't a car that specialises in that to beat it. An M5 is faster, a 911 is better looking, a Hilux has more towing capability, a Tarago has more passenger space, a ft86 is more tuneable, a Camry is cheaper, etc, etc.

dirkgently• 13 years ago

Its funny you had to mention 5 or 6 different cars to cover all the aspects of Tesla's 'inferiority'.

encoderer3• 13 years ago

Woah, stop that zero-emissions hyperbole engine before it runs away from you.

Seriously, it's "safer, faster, roomier, more fun to drive, more convenient, etc," than "any other car on the market?" Really?

Some of that is true. But there's also a lot of opinion there and a few total inventions. The Model S is the safest car on the market? My Mercedes stops itself if I don't see traffic in front of me hit its brakes. It gives me night vision. It will nudge me back into my lane if I drift. There's about 100 more cool safety features I can talk about, and all this in a car that costs less than the 80kwh Model S. And there's even more safety tech on the S Class which is just another 10-15k on the top Model S price tag. And of course BMW and other manufacturers have similar.

btilly3• 13 years ago

My Mercedes stops itself if I don't see traffic in front of me hit its brakes.

I have a friend who turned that off after his car unexpectedly braked hard in traffic because a piece of paper blew across his lane.

Not to say it isn't a good feature. But it isn't perfect.

lambda2• 13 years ago

> in every single regard (except for range)

And price, and convenience.

> more convenient

No it's not. The lower range, low number of charging stations, and long charging times make it quite inconvenient for long trips.

I bought a used car 3 years ago for less than the cost Tesla charges for replacing the batteries on its car (which you are estimated to need to do after about 8 years). This car is a station wagon, so has much more storage space than a Tesla. I go camping every year, about 550 miles from where I live. I can make that trip in about 10 hours including food and gas stops. For the same trip, I would need to make at least two hour long charging stops at Supercharger stations along the way (if I had the highest-end battery option). But there are no Supercharger stations along my route; so I would need to find places to charge with ordinary power sources. If I used ordinary 10 kW 240 V sources, it would charge at a rate of about 30 miles of range per hour, effectively tripling the length of the trip; now what was a long 10 hour drive has turned into a 30 hour trip, which means finding places to stop and sleep overnight (which hopefully can give you a charge).

Furthermore, I live in an apartment, without a dedicated parking space. I need to park on street. So there's nowhere I could charge my car at home; I can't exactly run a power cord down and across the sidewalk to my car. Neither is there anywhere to charge my car at work. There's no way I could even use a Tesla for commuting right now, let alone longer trips.

With a gasoline powered car, I just fill up at any gas station, my car holds the gasoline overnight so it doesn't matter where I park, and for the above describe trip, I need to stop for gas once before leaving and once on the trip, each a 5 minute stop.

The Tesla Model S is an amazing car. But claiming that it's more convenient, or is a better car in every way but range, is a vast overstatement. It would be absolutely awful for me, and many other people with similar needs.

Some of these problems are solvable; there will be more Superchargers installed, the price will probably come down, there will probably be more electric vehicle infrastructure. But it's still a gamble to say that they will completely eliminate all of these advantages that a gas powered car has over an electric car, at least unless the price of gas spikes dramatically.

jonknee2• 13 years ago

> The Tesla Model S is an amazing car. But claiming that it's more convenient, or is a better car in every way but range, is a vast overstatement. It would be absolutely awful for me, and many other people with similar needs.

Obviously convenience is different for different people. The OP is probably someone who finds car maintenance very inconvenient and as the owner of a used station wagon I am guessing you are not. If you don't take frequent road trips and have the ability to charge at home, the Model S is indeed very convenient--never have to worry about fuel and hardly ever have to worry about maintenance.

krschultz• 13 years ago

Look if you are comparing a station wagon to a Tesla, you are just not even close to their target market. A BMW M5 sucks for camping too, and it has nothing to do with the range.

jimzvz• 13 years ago

>The Model S is a better car in every single regard (except for range), than any other car on the market. It is safer, faster, roomier, more fun to drive, has more storage, quieter, more convenient, and less polluting.

It is not the safest, it is not the fastest, it is not the roomiest, it is not the most fun to drive, it does not have the biggest storage, I am sure some evs match its noise levels, it isn't the most convenient, it isn't the least polluting (I am sure the manufacturing process is more polluting than many cars even when considering the entire lifetime of the vehicle).

If you mean that it is the best overall, then that is very subjective and there are plenty of other candidates.

>Tesla is ahead of ALL other vehicle manufacturers...

If you mean with regards to electric cars specifically then perhaps, but with cars like the SLS Electric Drive[1] in production, I am not sure this is accurate either. If you mean in general, then that is ridiculous.

I love electric vehicles and I am looking forward to when they, hopefully, replace ICE vehicles but your comment is ridiculous. It is better to be realistic about the state of the technology.

[1] http://www.youtube.com/watch?v=IElqf-FCMs8

mikeyouse8• 13 years ago

A good article to help understand the massive afterhours movement: http://www.reuters.com/article/2013/05/08/autos-tesla-idUSL2...

High-Level Summary:

There was a ton of short-selling interest on TSLA (due to expectations of a big earnings miss). Almost 27% of the 115mm shares outstanding are currently being borrowed by short sellers. TSLA has more short interest by percentage than 98% of US stocks. Everyone was really expecting the price to go down.

Tesla reported earnings today at $.12/share, and upped their forward guidance. The consensus earnings estimates were $.04/share, so TSLA greatly surpassed expectations.

To short a stock, you have to borrow a share from someone else, and then return that stock to them at a later date. Returning the stock is called 'Covering a short'. All those people who were betting against TSLA are now forced to pile back into the market to cover, but since so many shares were short to begin with, the number of people who have stock to sell is much lower than typical.

This results in a 'short covering rally' where there is a lot of demand to buy shares and a small supply. Econ. 101 takes over and you see a big spike in the price.

revelation3• 13 years ago

Short levels have been that high for much of the existence of TSLA. Noone was expecting the price to go down with this announcement specifically.

What you are describing is a short squeeze, and it's still unclear if that is indeed what we are seeing. Many shorts have been unwilling to cover, even when having to pay up to 85% lending rates for stock. A proper short squeeze would not only spike the price, it will make it explode; Volkswagen became the most valuable company in the world at a share price of 1k$ through a short squeeze (even if only for a short time).

Remember also that a short squeeze depends on long investors not taking profit. It only worked in VW because the majority of shares were held by institutions unwilling to reduce their stake and of course Porsche, who manufactured the squeeze.

mikeyouse8• 13 years ago

The straddle on May 10 announcement was something like 15%.. people were definitely expecting some movement.

toomuchtodo3• 13 years ago

Elon Musk several days ago:

EDIT: My mistake, this was said much longer ago (September 2012). I just read it recently. Thanks to batbomb for pointing this out. My apologies.

“It’s doing pretty well actually given that we’re such a huge short position. In fact I think the short position may be as high as one can actually go. They literally hit the ceiling on the short position. The shorts are in it to the hills. I think it is very unwise to be shorting Tesla, it’s very unwise. There is a tsunami of hurt coming for the short."

http://www.siliconbeat.com/2012/09/13/video-elon-musk-tells-...

batbomb• 13 years ago

That's several months ago. If it was a few days ago he'd probably be hearing from the SEC soon.

Osmium• 13 years ago

This quote makes me very happy :) There's nothing better than proving naysayers wrong. As if it isn't hard enough making something useful as it is without people betting actual money that you're not going to succeed...

mikeyouse8• 13 years ago

Up 26% after-hours almost certainly qualifies as a 'Tsunami of Hurt.'

Some quick math for fun's sake:

If the TechCrunch[1] article is still accurate, Musk owns 28.4% of TSLA. His paper-worth on this ownership this morning was $1.8B. If things stabilize at $70/share, his paper-worth tomorrow morning will be $2.3B.

A notional profit of $500 million in 24 hours isn't too shabby.

[1]http://techcrunch.com/2010/06/28/tesla-ipo-musk-shares/

ncavig2• 13 years ago

This might be a stupid question, but as a Tesla stock owner, and (becoming more apparent ever day) naive investor, how do you find out this information and/or digest it so well? I'm mainly a google finance guy and had no idea so much of the stock was being shorted.

mikeyouse8• 13 years ago

I own ~95% index funds, which makes most of my research pretty easy. For the individual stocks I do own, I like to follow the analysis on Reuters. Even just spending an hour/week reading the latest news does wonders.

For Tesla: http://www.reuters.com/finance/stocks/companyNews?symbol=TSL...

Investing around a short squeeze is out of your control, and I would argue, not worth worrying about. The price will bounce around like crazy and some people will make 30% in a day while others lose much more than that, but in the end, Tesla's price will reflect their ability to turn a profit in the future.

If you feel like the future market cap of Tesla is larger than it is today (with all the usual time-value-of-money caveats), keep your money invested and don't waste your time fretting over the mayhem on Wall St.

ajross• 13 years ago

The cynical answer is that you specialize in post-hoc analysis like this. Predictions, after all, can be wrong. :)

This is true in general obviously, but investing specifically is filled with explanations like this that make sense only in hindsight.

epoxyhockey• 13 years ago

I am also a novice investor, but the # of shares that are short are actually listed on the details pages of many online stock sites, for example: http://finance.yahoo.com/q/ks?s=TSLA+Key+Statistics

Shares Short (as of Apr 15, 2013): 30.70M

Shares Outstanding: 114.52M

EDIT - I guess this is more relevant:

Short % of Float (as of Apr 15, 2013)3: 49.20%

EDIT #2: Congrats on the gains today! :-)

damoncali2• 13 years ago

Forgive the unsolicited advice, but I think that's the wrong question. First ask yourself what you'd do with that information. Then think long and hard about indexing your money.

Read up on portfolio theory and you will see that it's incredibly difficult (some say impossible) to beat the risk adjusted return of the market (at least not on purpose). It turns out if you are not in many stocks - 40+ (the exact number depends on who you ask), then you are taking more risk than you are being compensated for.

3am3• 13 years ago

http://finance.yahoo.com/q/ks?s=TSLA+Key+Statistics

Usually data from there is just parsed from the variety of forms that a public company has to file with the SEC, all/most of which are available to the public via a tool they have called EDGAR. Here's Tesla's filings: http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany...

EDIT: also, congratulations :) ask a real professional, but if you're tempted to sell be aware your holding period and of the tax difference between long and short term capital gains. Also, if you want to sell tomorrow and re-buy, be aware of wash sale rules.

munger• 13 years ago

Also don't forget - by the time you read the news about a company, the news has already affected the stock price (in the short term).

So in other words if you read big news the minute it comes out about a company, automated systems and institutional traders have already made their moves based on the news before retail investors have a chance.

rdl9• 13 years ago

TSLA options are also super weird and sketchy; around the expiration of the long-dated calls in January each year, there seems to be some magical push to drive the stock price lower for 1-2 days; then after the expiration, when I've been pushed out of the money, the price rebounds substantially. I gave up on TSLA options and am sticking to being long the stock.

dojomouse• 13 years ago

You don't need to wait until expiry to sell. There is a lot to be said for options if you use them carefully. Yes, risk is higher with high leverage and a narrow portfolio. But returns can be also. I think the line about risk adjusted returns being higher in index funds is 3 parts inexperienced investors trying to pick stocks without doing their homework and 7 parts experienced investors trying to convince inexperienced investors to provide mindless liquidity for them to work against. I prefer to make my own buy/sell decisions, and so far it's given me a FAR higher average return than any index fund.

jcnnghm• 13 years ago

I can't imagine this not squeezing. The short interest would take 7 days at 4 million shares a day to cover [1], and is about 45% of the float, assuming people haven't been covering for the last couple of weeks. Many of the shorts were opened when Tesla was trading around $40. I am really interested in seeing the updated short interest data from Nasdaq, which will be released tomorrow. If those numbers still show big short interests, expect big banks to hammer the stock up. I sold some shares for a little over $70 after-hours.

[1] http://www.nasdaq.com/symbol/tsla/short-interest

changdizzle2• 13 years ago

Great explanation - I (sheepishly) have invested a lot of money in $TSLA and have heard about the short squeeze but don't necessarily understand it, and this explains the movement - thanks!

JoeH• 13 years ago

I purchased a fair number of TSLA when they IPO'd, for a bit lower than the actual IPO price of $17. A little over a year ago, my brokerage offered to borrow my shares at 4% annual interest (paid on a monthly basis). I was told that I would retain the ability to trade the stock at any time, but I gave up my shareholder voting rights while the stock was "loaned" out.

I had never heard of that happening to small individual investors like me, and at that time I looked into it and learned that this was typically done because there was a lot of interest in short sales for the stock and there wasn't enough borrowable stock to cover demands.

I renew the loan agreement on a monthly basis and in March 2013 I was offered an increase from 4% to 6% interest for the loan of my shares, indicating that short-sellers were very eager to get their hands on TSLA stock.

I'm curious to see if today's activities cause my June offer to drop my interest rate or if the offer just expires altogether. I would guess that at minimum I'll see a lower interest rate.

revelation3• 13 years ago

Just to offer perspective, the interest to borrow shares of Tesla as of 2nd May was 46.10%. It was 85% as of 26th March.

steveplace• 13 years ago

Sweet, I was quoted in that article.

Seeing short squeezes in TSLA and GMCR aftermarket.

pfortuny• 13 years ago

Hedge fund managers and traders will try time and again to convince people that their job is not 'gambling'. They are having a tough time, though.

Some of them are really not gamblers but man, there are so many many of them willing to play with other people's money.

As long as they have zero-risk (zero responsibility, that is), they will gamble on.

olefoo4• 13 years ago

Meh, Teslas are boring status mobiles now. If you like your electric cars to be interesting and exciting. Order an Arcimoto [1] instead.

1. http://www.arcimoto.com/

toomuchtodo3• 13 years ago

Are they even in production? I know if I write a check I can get a Tesla.

olefoo4• 13 years ago

I've driven one. They're fun, they tilt to the curve. And they're more practical for a single city-dweller.

Also, whoever downvoted me... can we keep this civil please?

That HACKER news is becoming a place where people downvote mentions of upstart disruptive competitors in an attempt to curry the favor of well funded established companies. Is just kind of, sad.

scep12• 13 years ago

Correction: If you're in the market for an impractical, over-priced go-kart, order an Arcimoto.

MartinCron2• 13 years ago

I would argue that something as fundamentally impractical as the Arcimoto is more of a status symbol than a family sedan.

ricardobeat2• 13 years ago

You could at least have recommended a http://litmotors.com/c1/

MartinCron2• 13 years ago

Unlike the Arcimoto, the C1 seems to understand that if you're going to be a motorcycle, you should be able to lean into turns.

damon_c• 13 years ago

This thing looks fun. It's like they took apart a Segway and put it back together "cool"!

rdl9• 13 years ago

If you've been in Silicon Valley for the past 6 months, this was obviously going to happen -- virtually everyone I know who could afford virtually any production supercar, and cares about cars, has or wants a Tesla. Not an R8, not a GTR, not a California, not a Panamera, not an M3, but a Tesla. As they ramp up their production (I think it's down to a few months wait),

The only rich people (who own cars) not getting Teslas seem to be either totally non-car people (or just cheap on capital costs vs. cost-efficient on total costs), or those who live in the City without a garage parking spot. Solving the Tesla street parking charging issue would be the next big win -- you could probably get away with 480v supercharging at work for 2-6h/day and street parking at home, although weekends might be tough.

grecy• 13 years ago

Does anyone driving any of those super cars you mention park on the street?

rdl9• 13 years ago

Surprisingly often. If not routinely, they absolutely do during the day when visiting places.

waterlesscloud• 13 years ago

It's not a supercar, but a guy in my neighborhood (in Los Angeles) parks his Bentley on the street.

Me, I'd clean out my garage if I had a Bentley.

mikeyouse8• 13 years ago

I live in San Francisco, I rent a small apartment in a fairly nice neighborhood. Without fail, every night parked on the street are 2 Audi S5s[1], a Tesla Model S[2], an E63 AMG Wagon[3], and a smattering of Porsches (new Boxters to oldish 911's).

[1]http://www.motortrend.com/cars/2013/audi/s5/pricing/ (~$60k) [2]http://www.teslamotors.com/models/options (~$80k) [3]http://buyersguide.caranddriver.com/mercedes-benz/e-class/20... (~$100k)

jfb• 13 years ago

I've seen Johnny Ive's Aston Martin parked on the street in the Mission, along with more pedestrian 100k M5s, E63 AMGs, 911 Turbos, &c.

matwood• 13 years ago

If you worry about parking on the street then you can't afford the car.

damoncali2• 13 years ago

If you've been in Omaha for the past 6 months, you more than likely do not know what a Tesla is. Be wary of the echo chamber.

rdl9• 13 years ago

Most of the people who can afford 100k cars (and/or who would be willing to buy 100k cars) live in SF, LA, NY, Boston, DC, etc. now. A better argument is that the total number of cars sold in those markets is like 1-2mm out of the 10mm US market, but even if Tesla just becomes Audi, that's pretty successful.

Another thing about high cost of living in places like that is maybe you're willing to spend 10% as much on a car as on a house. In Palo Alto that means you can buy two new loaded Teslas to go with your 2BR/1BA cottage; in the midwest, one used Toyota to go with a 4BR/3BA house on 5 acres.

(and Elon Musk's counterargument to all of this is that he's working on a 30-50k car next. I'm sure he'll deliver. The segment they're neglecting is the truck/commercial market -- there probably is an opportunity for someone (Textron? they make the new EV UPS/Fedex trucks) to make an awesome commercial EV platform, maybe with a CNG or LNG generator onboard. Whoever replaces with pickup truck and light commercial truck will have a next-Ford sized business, too)

http://www.npr.org/2012/04/02/149703488/oil-scare-turns-fede... is interesting

Someone• 13 years ago

Echo chamber, indeed. There are over 200 million cars in the USA vs fewer than 20 thousand Teslas. The Teslas are newer, so less likely to be kept in garages, but because of their range they also are less likely to be on the road for 10 hours a day.

So, I would expect that, on average, on the order of 1:10,000 cars on the road would be a Tesla.

If people say way more of them in California, there must be spots where people see fewer.

sliverstorm• 13 years ago

I suspect some of this has to do with the newness and perceived scarcity. Once everyone who can afford a production supercar owns a Tesla, demand will fall back a bit.

berberous• 13 years ago

I'm a huge Tesla fan, but you are definitely in an echo chamber out in SV. Tesla has a huge tech/geek appeal. I know plenty of non-tech rich people from other places who would still much rather have their Mercedes or Bentley.

cjoh• 13 years ago

I'm a huge Apple fan, but you are definitely in an echo chamber out in SV. Apple has huge tech/geek appeal. I know plenty of non-tech rich people from other places who would still much rather have Windows and Blackberries.

anateus• 13 years ago

The last several months in Silicon Valley I do not remember the last time I went outside for more than 5 minutes and not seen a Tesla. I noticed about a week ago I stopped caring, much as I do not especially remark on noticing a Honda or a Ford. That's a good sign, though likely very geographically localized.

msoad• 13 years ago

Me to my wife when driving in SV: Do you know Tesla cars? They are amazing!

My wife: No, I don't know about them.

Me: Let me show you one (in two seconds) here is one. Look how beautiful is that!

To find a Tesla in Silicon Valley you just need to turn your head up!

jakebellacera2• 13 years ago

> though likely very geographically localized.

Last week I drove from Sacramento to San Jose and it seemed as if the closer I got to SJ, the more Teslas I saw.

dangrossman• 13 years ago

> though likely very geographically localized

I live a bit outside Philadelphia (but visit the city proper often), and haven't seen a Tesla here yet.

johnward• 13 years ago

I've seen 2 in Pittsburgh. I see one driving what I can estimate is ~30-40miles one way every day.

southphillyman• 13 years ago

Lower Merion resident here. I see them from time to time in my area and on 476. Have not seen them in Philadelphia proper yet.

Shebanator2• 13 years ago

There are so many Model S's at google we call them "Palo Alto Camrys".

timdorr2• 13 years ago

I'm in Atlanta and get gawked at pretty much every time I go out. While we've got a very active group of local folks on Facebook, they're still relatively rare to see around here, even in the heart of upscale Buckhead.

mfringel• 13 years ago

I've seen a grand total of one of them in the Boston area (Somerville, to be precise), but Boston has never really been a big place for supercars... this is for two reasons:

1) General New England frugality.

2a) New England winters eat cars due to the salt and potholes.

2b) ...which means that you must garage your supercar for 3-4 months of the year because it's just not practical to use.

2c) ...which means that you have:

2c1) ...two cars (no big deal)

2c2) ...and the ability to garage one of them full-time for 3-4 months, which is a problem anywhere in the 617 area code because...

2c2a) Boston Is Full.

clientbiller• 13 years ago

Don't... Bet... Against... Elon...

chuhnk• 13 years ago

Ask HN: Will anyone be buying Tesla stock when the markets open tomorrow? I'm wondering whether its a good investment moving forward?

encoderer3• 13 years ago

Wait for profit takers to bring it down a little but yes, if you're willing to hold for the long term -- 5+ years at least -- I believe in it. I think a $100 price target is not absurd. Of coruse, Tesla is so comically far from becoming a mainstream car company that it's not for the feint of heart. It's not their products that will challenge them I don't think. It's the difficult of scaling a car company. No easy task.

gfodor• 13 years ago

I'd add it's also probably a good idea to wait for some bad news since the market is probably likely to over-react and anybody still skeptical will see that as an exit point to take profits.

peterhajas• 13 years ago

> This is Tesla's first profitable quarter.

I suppose this isn't factoring in the countless enormous government subsidies. I don't really count this as "profitable".

matthewaustin• 13 years ago

Ah, well if you get to make up your own definitions of profitable, then I suppose they weren't.

But if you use the actual definition of profitable, meaning they had more revenue than expenses in this quarter, then they were profitable.

jonstjohn• 13 years ago

If you re-wrote company profits with all the subsidies, tax breaks, etc, factored in, you would see a much different profit landscape across the board.

changdizzle2• 13 years ago

I refer to Elon Musk's tweet on April 25:

"Seems to be some stormy weather over in Shortville these days"

https://twitter.com/elonmusk/statuses/327446760219889665

jtlein• 13 years ago

I guess it's a California thing. You have to believe in global warming (In the mid-west we have had 20 degrees below normal now for 3 months and snow of 14 inches in May). My practical side says the Tesla is nice but if fighting CO2 is your aim you could buy a $20K Honda accord and convert it to run on ammonia ( nearest practical gas to hydrogen). Ammonia is already piped all over the midwest and in contrast to grid power is almost all made from domestic natural gas. And with a loan of $450 million like Musk got I could build a home ammonia generator that takes in grid power to generate hydrogen and using nitrogen from the air. The small ammonia reactor is the only thing that needs to be developed (the hydrogen generator and nitrogen from air products are already off the shelf).

deelowe2• 13 years ago

I think we'll start seeing very high mpg gasoline cars soon. Supercar makers are already demoing electronically controlled pneumatic valves and direct injection and doubly clutch gear boxes are now showing up on family sedans. Direct injection + independently variably valve timing + double clutch close ratio gear boxes + regenerative braking and plug-in hybrids should equate to extremely high mpg for gasoline based vehicles.

I agree with the few here that have stated that tesla is in a SV bubble right now. It's the just hip thing to do, similar to the prius situation 8 or so years ago, but with much less volume due to the price point.

CamperBob2• 13 years ago

Interesting, I didn't know ammonia was all that combustible. Won't NoX emissions be a problem?

Also, won't the fact that ammonia is almost stupefyingly toxic be a problem?

chrisgd• 13 years ago

Climate change can mean snow in May as well as heat in December.

downandout• 13 years ago

GAAP profit was $11 million. Zero emission vehicle (ZEV) credits sold to other automakers amounted to approximately $68 million. In other words, taxpayers gave $68 million to Tesla this quarter. Without this taxpayer gift, which will be drastically reduced going forward, they would have posted a loss of $57 million this quarter. Not fantastic.

jstalin• 13 years ago

It seems that their business model is entirely dependent on government subsidies. So now that wealth is being transferred from general US taxpayers to the shareholders of Tesla.

simonh• 13 years ago

Considering the $17.4Bn bailout of the conventional US car industry a few years ago it's small change.

Personally I'd be a little more concerned about the $20Bn per year paid in farm subsidies, to an industry with median household incomes 17% higher than the national average, if I were a US citizen. At least the money going into Tesla is buying the US a lead in the future of automotive technology, instead of going towards further impoverishing third world farmers.

cheapsteak• 13 years ago

Could you explain how the money other automakers paid Tesla for ZEV credits is paid by taxpayers?

Also why would this 'gift' be drastically reduced? I thought ZEV quotas were rising.

smackfu• 13 years ago

Yes, I think the parent may be confusing the ZEV credits with tax credits. Car manufacturers (in California at least) have to make a certain number of cars with low and zero-emissions. For 2012, I think it's 13%. Tesla makes 100% of their cards as ZEV, so they take 87% of their credits and sell them to other manufacturers who don't sell enough low emissions vehicle, or who sell no ZEV.

The important point is that these credits were created out of thin air, and don't cost the taxpayers anything. And their goal is to do exactly what they are doing... to get a certain amount of ZEVs vehicles out there, and to give manufacturers a financial reason to sell more, since they don't want to be buying those credits from Tesla.

goggles99• 13 years ago

I remember when Geo Metro's were popular. They got 50+ MPG. Then the fad ended and... Is Geo still around?

codex2• 13 years ago

Without the cash from selling California ZEV credits gross margin on the Model S would have actually decreased quarter over quarter. It will be interesting to see how it gets to 25% without ZEV, and whether Tesla needs to sell more stock to finance development of the Model X.

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