In July, everyone panicked over a post in Seeking Alpha claiming that Norway deliveries had suddenly and inexplicably dropped. And now everyone is panicking over a post in the WSJ claiming that US demand has suddenly and inexplicably dropped, and that “sagging” US sales is the real impetus for Tesla’s new leasing program, which offers lower payments and a three-month return policy. We heard similar warnings about a plateau in Model S demand back in April. Turned out to be nonsense.
Credit Suisse quickly spanked the WSJ, calling its article “misleading,” for a couple of reasons:
1. Leases are complex machines. Better lease rates are often attributable to better resale values and more favorable backing by a bank, not subsidies from the automaker. So a lower lease payment does not necessarily speak to lower demand or lower margin for Tesla. It could mean just the opposite.
2. A relatively small automaker like Tesla cannot expand internationally and hope to appease all markets equally. Deliveries are bound to be erratic, and surely deliveries are the metric used by the press because Tesla does not publish its order tallies.
Trying to unscramble Tesla’s delivery patterns is like trying to unscramble scrambled eggs. And dissecting a lease is equally futile. Don’t base an investment decision on a WSJ post that combines two benign datapoints and implies Apocalypse Now. Unless, of course, you love the smell of napalm in the morning, like Rupert does.
UPDATE: Musk, Twitter, you know the rest. Read comments.