DailyTech - Tesla Reports Second Quarter Losses, Has High Hopes with Model S Sales

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Auto Tesla Reports Second Quarter Losses, Has High Hopes with Model S Sales
Tiffany Kaiser - July 27, 2012 2:25 AM

16 comment(s) - last by EricMartello.. on Jul 29 at 6:59 PM

Tesla Model S

Tesla Model X

Tesla posted a revenue decrease of $26.7 million from $58.9 million a year earlier

Tesla may have a winner on its hands with the Model S' recent release, but the electric vehicle (EV) company still reported financial losses for Q2 2012.

For the second quarter, Tesla posted a revenue decrease of $26.7 million from $58.9 million a year earlier. It also reported losses for the quarter of $105.6 million (89 cents per share) from $58.9 million (53 cents per share) last year.

Tesla is in transition mode at the moment. It's currently going from only selling a few thousand of its Roadster battery electric vehicle sports car, which goes for about $109,000, to now selling its first full production vehicle, the Model S.

The Model S was initially announced three years ago, and finally shipped June 22. The Model S comes in three different versions, with 40 kWh, 60 kWh or 85 kWh battery packs. The lower-end 40 kWh base model will sell for $57,400 while the higher-end model will sell for $105,400. The Model S is eligible for the $7,500 federal electric tax credit as well.

It was recently reported that the 85 kWh model could earn a 265-mile driving range window sticker rating from the EPA, which would put the Model S far ahead of the electric competition.

The Model S has proved to be quite popular with Tesla having 10,000 reservations for the vehicle before it shipped. Having the Model S onboard will definitely help Tesla as it moves toward becoming profitable. Up until now, it has reported losses of over $500 million since 2009.

"We are maintaining our revenue guidance of $560 million and $600 million and our Model S volume projection of 5,000 units for 2012," said Tesla in a letter to shareholders. "We expect to deliver approximately 500 vehicles to customers in Q3 with the balance delivered in Q4."

The next step on Tesla's list is to build its Model X crossover late next year.

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well

By TSS on 7/27/2012 8:42:33 AM , Rating: 3

i guess everybody is in wait and see mode now. They survived the roadster, but only with alot of help. This has all been leading up to the model S and the question of wether the top down model works, the next quarter will give more reliable results. Profitable in '13 will be very hard regardless of what tesla does because it's scheduled to be one bad financial year for everybody.

After that we'll move on the the stumbling blocks of actually producing a <$20,000 electric car. Considering the prices vs the ranges, i doubt it can be done by anybody. But i'd like to see Musk give it a try.

So let's get the political debate going shall we?

quote:
The lower-end 40 kWh base model will sell for $57,400 while the higher-end model will sell for $105,400. The Model S is eligible for the $7,500 federal electric tax credit as well.

That put a smile on my face (i'd say tear, but i'm not american). ~50k is more then 2 years worth of my income. Who's buying these cars and why the hell do they need even more money? Not being the socialist here i'm fine with other people being rich but i have to question the less rich giving the more rich more money because they couldn't afford it otherwise. Last i checked monthy python was a TV show, not a description for reality.

RE: well

By othercents on 7/27/2012 8:48:20 AM , Rating: 2

They also have their other contracts with car manufacturers like Toyota that want to put the Tesla battery system into their vehicles. I believe that this is supposed to start in 2013.

Other

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RE: well

By lifewatcher on 7/27/12, Rating: 0

RE: well

By EricMartello on 7/27/2012 7:50:09 PM , Rating: 2

Sounds like you're onto something until you realize that sales taxes are imposed by and collected by states and not on a federal level. The $7,500 credit is coming from federal tax dollars, which essentially means taxpayers are subsidizing a failing industry just to appease the eco-tards.

Tesla has not been profitable since its inception. Let it die, and get off the change for the sake of change bandwagon. Just because something is different doesn't mean it is better. A lot of people don't seem to get that.

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RE: well

By sowhy on 7/29/2012 12:30:16 PM , Rating: 2

Eric....let it die?!? That seems very short sighted. I am VERY grateful most entrepreneurs do not have your vision....or lack thereof.

This is a huge undertaking. And if Tesla succeeds, we will all benefit. Even if he "fails", there is still a lot of technology discovered and improved.

I would MUCH rather see my tax dollars go towards technology and new business instead of more welfare for many people who do not deserve it.

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RE: well

By EricMartello on 7/29/2012 6:59:48 PM , Rating: 2

I am an entrepreneur myself and I don't expect tax payers to subsidize my ventures. The fundamental point of starting a business and making it successful is shouldering that initial risk and accepting that you may lose your shirt in the end.

If Tesla was left to their own devices and stopped getting handout after handout they'd have been out of business long ago.

Tesla should stop pretending to be an auto manufacturer and just focus on licensing their powertrain to interested parties. Securing some tech licensing deals would give them some real cashflow without additional overhead rather than fishing for subsidies - aka corporate welfare.

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RE: well

By Reclaimer77 on 7/27/12, Rating: 0

RE: well

By Dr of crap on 7/27/2012 12:14:28 PM , Rating: 2

Well said!
If only more had these feelings!

The thing that Telsa has going that others might not, is the status thing. If you have the cash and want to give the outward apperance of "caring, going green" then you might go for the Tesla. Not to mention it's kind of the sports car of the EV world. I'd drive a Tesla over ALL of the battery powered or hybrids any day!

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RE: well

By Shig on 7/27/2012 3:49:39 PM , Rating: 2

Tesla is never going to make a <20,000$ electric car. It makes luxury cars.

Their next 'cheap' model will be priced similar to a 3 series BMW. ~36k, then if the tax credit is still around it could go for 29,999$.

Their full car lineup will look like Mercedes, Audi, BMW. They'll have two premium sedans (Model S + new cheaper model), an SUV (model X), and a supercar coupe (newly redesigned roadster).

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RE: well

By Ammohunt on 7/27/2012 3:50:37 PM , Rating: 2

Guy where i work owns a tesla coupe 2 seater(not sure what model) but you can tell its either a mid life crisis or he is compensating.

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RE: well

By Shig on 7/27/2012 4:05:54 PM , Rating: 2

Porsche and Ferrari have been milking those for years :)

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RE: well

By boeush on 7/27/2012 4:49:43 PM , Rating: 2

quote:
Electric vehicles just can't work for enough people for Tesla to seriously make it big. Especially at those prices, as you've pointed out.

I don't suppose Porches or Lamborghinis work for enough people, either. Explains why they don't exist, don't it?

quote:
People don't want electric vehicles.

Bull.

It's all about range (for some) and price point (for others.)

Tesla's starting to address the range. For me personally, 500 miles would be the threshold where I no longer consider range to be an issue. Looks like with Model S Tesla's about half-way there. The R&D; needs to not only continue, but to accelerate. And I'm perfectly fine with the government at least sponsoring it, if not directly funding it. I'd go so far as to say it's a national security issue.

Price will inevitably come down over time, as volumes ramp up and competition comes in from the Chinese and other third-world slave economies with which we have stupidly/suicidally established "free trade" (a.k.a. "giant sucking sound") relations.

Regardless, electric vehicles are the future. Gasoline vehicles are doomed to go the way of the horse buggy. Do people still ride horses? Sure, as a hobby...

quote:
I think at this point, that's a fair and balanced observation.

Quoting FOX propaganda slogans is normatively symptomatic of a brain washed so clean, it might no longer evince a detectable mind.

quote:
Even the Volt, which eliminates range anxiety and has gotten TONS of hype and PR, has failed.

The Volt is a crappy design, and a crappy car. That's because it's a GM product, not because it's an electric hybrid. The Prius plug-in is now out, and Ford's C-Max is coming soon. Everything you're now saying about pure-electrics, tools like you used to say about hybrids. You were wrong then, and you are still wrong now.

quote:
End the subsidies, stop bailing out Tesla and the others with these absurd Crony "loans", and let's move on.

And let's also stop bailing out Wall Street. Let the whole financial system blow up and take us all out with it. It'll make us all feel better, assuming we survive the blast... Tongue only slightly in cheek.

I'm actually all for it, but unfortunately most of our nation has turned into a bunch of spoiled and frightened pussies. (Not that our finances won't blow up eventually regardless -- ala the PIIGS -- just as soon as the rest of the world has done blowing up. The math is what it is... Certain people have long wanted to drown government in a bathtub, and/or starve the beast; their multidecadal project will soon and finally bear fruit, except the beast is the 99%, and the ones drowning are the underwater "homeowners", the over-indebted students, and the working poor -- IOW, the newly reconstituted indentured servant class. (Unfortunately, starved beasts have a habit of becoming very dangerous, indeed... We might within the next decade or so experience a reprise of the early 20th-century revolutions. But I digress.)

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RE: well

By sowhy on 7/29/2012 12:36:51 PM , Rating: 2

boeush - Great to see there are still a few forward thinkers on this planet. I will DEFINITELY buy one if they can get it to about 40k.

Investing in technology and manufacturing rather than Wallstreet is the way to go.

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RE: well

By Dug on 7/27/2012 5:48:20 PM , Rating: 3

Where do you live? A lot of people have been waiting for a luxury all electric car that doesn't suck. 10,000 pre orders for a car people have never driven is very good. The signature series is already sold out. They plan to increase to 30k production in 2013 because of demand.

The Volt is failing because there is no luxury, performance sucks, styling is maybe ok. A typical GM car.

When you can get 0-60 in 4.4 seconds and look good doing it, then the fun factor kicks in. And people line up for that. Read some reviews from actual drivers on how well it performs.

As far as pricing goes, they aren't any different than Infiniti, Lexus, Acura, BMW, Mercedes, etc.

And when has Tesla been bailed out? They received the same loan anyone else could get. They received $465 million. Ford received $5.9 billion! Musk said he would personally pay it back if they did fail. They are exactly where they expected to be at this time, even beating analysts.
How do you think any company gets going, its all through investments, whether government, public, or private sectors.

It the first American car that people from all over are excited about.

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RE: well

By Ringold on 7/28/2012 3:07:26 PM , Rating: 2

I love this issue. It's forcing you guys to take both sides of an argument.

On the one hand, you deny it's failing in the market place, even though they and hybrids, which the other high-brow snob above hung his hat on, make up a tiny, tiny portion of global sales. Liberals point to Porches and Lambo's, which receive no comparable tax subsidies federally, as comparable brands.

And yet on the other, despite this success, you guys generally say it needs not just the level of support it already gets, but perhaps even more subsidies. Why, then, if its so successful and obviously the future? Why help Musk get even richer since you think it's so obvious?

Not sure why liberals don't think anything at all can ever happen unless the government forces it. Battery technology will continue to push on even if this market collapses from being uncompetitive now simply because batteries are so widely used in other important (and unsubsidized) markets. Yes, I even agree, it's the future, but it doesn't need governments help.

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