Tesla Q3 letter: Just wait till next year

Gigafactory construction TeslaMondo* Gigafactory foundation is already getting poured (pic). Should be able to crank out product by the end of 2016, not 2017 as originally projected.
* Model X is sold out for 2015, and production is delayed until third quarter of 2015, so “Waiting for Godot” gets another chapter. Sigh. “We prefer to forgo revenue, rather than bring a product to market that does not delight customers. Doing so negatively affects the short term, but positively affects the long term. There are many other companies that do not follow this philosophy that may be a more attractive home for investor capital. Tesla is not going to change.” Fair enough, but look what happened when you delayed the James Bond Lotus submarine project. Someone beat you to it.
* Model S demand not slowing anywhere on the planet, despite recent spook stories. In fact, Tesla expects to double overall sales volume every year for the next several years.
* And this tidbit: “Our recently opened Shenzhen location in China is already one of our highest grossing stores worldwide.”
* After hours head-slaps heard ’round the world as recent sellers become buyers again. Fools!

In the conference call, Musk said he’s confident that Tesla could meet its 2015 volume goal even if China didn’t exist. And in response to a question about whether the Model X is even necessary given the new dual-motor Model S, Musk said the Model X is not a necessary bridge to the high-volume Model 3, but still is a “special” addition to the Tesla lineup. You could hear this for yourself if only the audio stream on Seeking Alpha weren’t frozen.

While financial analysts asked mostly dry questions about product allocation and profit margin, they forgot to ask the biggies:

1. Will the X have a roof rack or not, dammit?
2. Will it have side mirrors or cameras, dammit?
3. Will people who live in high-rise buildings be able to own an EV, dammit?
4. Any other Gig partners besides Panasonic, dammit?
5. Any patent-sharing news worth mentioning, dammit?
6. Is Tesla pondering any move toward franchising, dammit? If so, what product could be stockpiled for quick delivery, given an ongoing supply constraint?
7. Does yesterday’s Republican victory spell policy trouble for the EV segment, dammit?

Shareholder letter


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