Tesla Reports Steep Drop in Profits Despite Us Rush to Buy Electric Vehicles
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Tesla reports a significant drop in profits despite increased US demand for electric vehicles, sparking discussion about the impact of Elon Musk's actions and the broader economic context on the company's performance.
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WTAF. I'm not sure who could think he deserves this much pay (other than himself), after tanking the brand.
It's basically the board saying "uh, sure, if you earn us 8.5 trillion dollars, we'll give you a trillion of it".
It's an absurdly high bar, and the board had no real incentive to not throw it out there. Honestly every board should do this. Why not.
growing 25% when a company is say 50-100b is a lot different than going towards 10 trillion
and valuations are already so stretched across the board
What a monumental fall
The rush to buy electric vehicles was baked into the expectations, so beating by 2% is still noteworthy.
So what they said is correct but a little misleading, perhaps as a dig on Tesla’s naming conventions.
They don’t sell a car over 62000€ in Europe.
“ In 1974, a new car cost an average of 5320 euros. The average income was 13,928 euros per year, so a buyer had to work for an average of 4.6 months for a new car. 20 years later, it was already 7.4 months per new car. Until 2019, this number remained stable, but then it skyrocketed. Today, a buyer has to spend all his income from 9.6 months of employment to buy a new car. For more expensive e-cars, it is even 11.4 months. The reason is stagnant incomes, but also high profit margins of the manufacturers.” https://www.tagesschau.de/wirtschaft/verbraucher/kosten-auto...
From my personal perspective, as an employed software engineer, all cars over 50k are luxury.
62k Euros gets a lifetime of used vehicles. I'll say the quiet thing: buying a new car and taking the depreciation is a form of luxury. More about status than getting to the destination.
Dan has a point. I could pay for half of a house right now, committing seems silly until things cool down. Two articles away from being relocated again, despite working remotely.
Yes, the Cybertruck that nobody really wants, and a Model Y with an extended wheelbase. Yay.
The legacy automakers are fully in the game and everyone now remembers: oh wait, they know how to make cars. Tesla... ehhh
Kia, Hyundai, even GM are really giving Tesla a run for their money in every segment.
Tesla makes their own fabrication machines in house, so their body panels don’t have to look like every other manufacturer that uses standard supplier machines. And I’m not referring to the cyber truck, the shape of the main line cars is not achievable with the standard equipment, which is why they are able to stand out visually.
Where are the competitor electrics beating out Tesla? Are the acceleration dynamics better? Is the handling better? Is the screen better?
I’m guessing the seats are more comfortable, and the interior is bifurcated into nicer and less nice parts with the average niceness being about the same. They might be dumping here though since they are still burning through cash on these cars AFAIK, so I think it remains to be seen whether whatever advantages they have in the comfort and materials areas are sustainable.
(For the record, the electric door openers and the self driving labeling are both moronic, but when you have a dictator you can’t really avoid getting some bad stuff where the individual guy turns out to be wrong about something).
Legacy makers are producing cars with things consumers actually want. Higher quality interiors, nice exteriors, good ride dynamics, Apple car play, and competitive price points.
I think the reality is that most people actually don't care about Teslas big screen or autopilot. They want a car thats somewhat normal that does car things and does them well. They want good range, comfy seats, and steering wheel stocks.
Kia provides that, Hyundai provide that, pretty much everyone provides that except Tesla. The extra acceleration points doesn't matter. It's never really mattered, that's just a spec sheet bragging point.
I am not talking about the size. Capacitive touch screen hardware and software seems to be really difficult to nail. The actual touch interface on Tesla is at the iPad level. Also the material quality is very good.
All other cars I’ve tried recently have all had a touch screen, it was just bad. If I have to have a screen, I want it to feel like a first class citizen and not some cost cut afterthought.
I don’t really get why people would want CarPlay instead of the native Tesla OS? I have another car with CarPlay which was more expensive than my Tesla (so apples to apples or better comparison), and I find CarPlay on the B tier screen to feel extremely clunky by comparison (though still much better than what came before in the legacy makers).
Have you daily driven a Tesla before? Have the other car makers released some crazy breakthrough? I might test drive some, I’m curious now.
It seems to me like the biggest difference is the media turned against Elon, and so we went from having positive coverage of Tesla to negative. I think that alone could explain the sentiment shift, based on how people all around me seem to be brain-led by the media.
the problwm with tesla is that it is a dinosaur. I own 2014 Tesla S, my neighbour latest one - it is same f’ing car. tesla X was cool looking… in 2016, now it looks like it belongs in a museum. model 3 is chopped up S and Y is blown up 3. the cars are sooooo outdated it is nuts people still buy them
Hi, it's me, I've driven Tesla's and yes - I prefer carplay and android auto, and I have good reasons for it.
The first being that touch displays, even if they are the best displays that could be manufactured on Earth, will always be inferior to physical controls for many functions.
Me swiping up and down or pushing plus or minus to turn up the heat does not compare to a rinky dink dial found in a 1999 Toyota Corolla.
So then, what's left? The software-only stuff: navigation, music, notifications.
I think CarPlay and Android Auto does all of those better. Navigation is best on Google Maps and Apple Maps. And, even if you disagree, just have ONE app to do it across the board and share the data is a superior experience.
But, even if you're still not convinced, consider: your phone is 500 - 1000 dollars, and your car is tens of thousands of dollars. Why are you tightly coupling these throw-away software functions to such an expensive thing?
What happens if, tomorrow, some service goes away and your Tesla doesn't update? Then you'd be like those bozos who bought a fancy SiriusXM subscription in their 2015 car.
The blower speed can be mapped to the steering wheel button. And it’s actually easy to map things because the software is made by a company with real software people, the software quality in terms of intuitiveness is night and day compared to the legacy companies. I find it easier to adjust the heat/cooling in my Tesla compared to the standard buttons. I don’t generally mess with the temperature though, and turning AC on and off is very slightly annoying through the screen, but that doesn’t happen much. Also the voice controls actually work well enough that I can use them reliably. You do have to figure out what to say (“my butt is cold” does not turn on the seat heater, unfortunately), but once you know that the system is very good at reliably picking up what you’re saying.
> What happens if, tomorrow, some service goes away and your Tesla doesn't update?
I would sell it at a greater loss due to it being nerfed and I would at that point buy a different car. I don’t generally drive cars that old anyway, just because random issues become a lot more frequent and I don’t want to deal with that.
Like do we really need our cars to have random shapes added and removed from them every 3 years? Why? Sure, novelty feels good, but the impact of this behavior is pretty clearly not positive. A lot of waste is generated, both at a societal level but also at a personal and familial level, and also in terms of industrial production resource direction, basically in the name of fashion. The new BMW design isn’t any “better” than the old design, it’s just visual social memes.
So anyway it makes sense that Elon is being stubborn against this, and it also makes sense that he will probably fail at doing that because not everyone is a turbo autist.
For example Tesla uses a very large press to make the Y monocoque body in one or two pieces. They get a lot of their manufacturing capability this way, reducing assembly costs and weld time, but then they do weird stuff like bolting the control are inside the passenger wheel well interior under the carpet. This kind of stuff isn’t replicable , each vehicle is for the most part a siloed manufacturing process
This is fine for a one off model, but now the manufacturing process is bespoke across the board. Any other maker can switch out parts of the line and make a different vehicle, Tesla needs to redesign the process, supply new assemblies, get another Gigafactory Press from Idra Group, and then retrain everybody. So they don’t.
Instead you get Full Self Driving.
Pretty much every Tesla product has been seen more than a decade ago (cybertruck was first discussed in think 2014) except the Semi, which doesn’t exist, but had lots of press regardless.
The entire history of the US car business has shown that the path to success is to produce different variants for different customer bases and refresh those variants to drive continual sales.
Some manufacturers take this to Nike-level extremes with rare variants, 1-of-1 models, etc (looking at you, Porsche). Other manufactures take it to the other extreme with base one platform being repurposed for 5+ different customer segments with wildly different body designs - for example the Toyota Tundra, Tacoma, Lexus LX, 4Runner, and Land Cruiser are all the same car with a different shell.
So the conventional wisdom in the industry is that Tesla is committing suicide by producing generic, stale cars without model variants. Tesla seems to have bet that the conventional wisdom is wrong and producing cheap, repeatable cars with less variation is a better business strategy. Time will tell.
As a result they just treat ev and hybrids like any other model for the most part wrt marketing and so forth. It’s understandable that you wouldn’t want to cannibalize regular sales and service. Financially, they don’t need to. It does help their CAFE fleet standards.
It doesn’t make as much sense for Toyota since they have some of the segment (economical or environmental buyers) covered by Camry and Prius, which they’ve been making for like 30 years.
As for “why should cars change every 3 years”, well, they don’t.
Other automakers typically develop a platform and use it as a base for many models over several to many years.
Mercedes-Benz platforms have lasted over a decade, encompassing many badges. GM make Escalades and Yukons, they are the same platform with different options.
There is a sure benefit of Tesla: competition in the EV space, since they had no product to match GM.
Just an aside, electric cars aren’t even close to new, Tesla was not first to market. They were pretty popular 120 years ago, but clearly things change.
This argument makes about as much sense as saying Apple hasn’t released a new phone since 2007.
[lets set aside the CT, agree)
They lost a lot of the advantage they had on hardware, but if you want a non-chinese EV with really good software and well-thought and working UX they're still a perfectly valid all-rounder with a very good charging network, and they also refine their hardware over time.
They refreshed the M3 and MY looks recently and changed the shapes a bit, but I always understood their looks to be function over form for efficiency reasons, and they don't look bad at all if you ask me. Simple, effective, efficient and timeless designs.
I agree with the other comments here that changing shapes for the sake of changing shapes it's just marketing.
EDIT: to be honest, the only thing that really annoys me is they didn't release an EU A/B/C segment ~4m car with all the features of a standard Model 3/Y. Instead they took the existing models and made them cheaper.
I’m fairly certain that the overall decline in interest is mainly due to general economic uncertainty and the phasing out of EV incentives in various countries. But I’m trying to say that it’s clear that Musk’s reputation has taken a hit! ironically among some of the very demographic groups most likely to be Tesla customers.
So which is it really, or is it a mix? Political, Personal, or Financial?
> The loss of EV credits as a result of Donald Trump’s One Big Beautiful Bill Act was a factor in the public breakup between Musk and the president and has continued to influence the company’s sales forecasts.
> Musk has also insulted Sean Duffy, the US transportation secretary, this week in a series of posts that included calling him “Sean Dummy” and reposting calls for him to be removed from his post. Duffy, who is also acting head of Nasa, stated on Monday that he would reopen the bidding for contracts related to the space agency’s Artemis moon mission because Musk’s SpaceX rocket company had fallen behind on its timelines for the project.