Do you not feel that it's risky to change the terms after the services have already been purchased? I would have to conclude that the reward to Tesla outweighs the risk that they are incurring. The cost for a Tesla alignment is only $150. That tells me something.
Kapitan, these things are not just sales promotions. People prepaid for these additional services.
Ranger service was a prepaid item (though available only to a few customers). It included on-the-spot repairs and free towing and loaner car if the situation warranted. Now the towing is no longer free.
Supercharger access was a prepaid item. Access was unlimited for life. Now customers are being told that it's really only meant for longer trips.
And now the prepaid $600/yr service. It used to include wheel alignment. Now it only includes tire rotation, brake inspection, and wiper replacement. For 600 bucks. Seriously! Stop by my house and I'll do those things for $500.
No, I'm afraid it's indicative of a larger problem.
Thank you, "other n0m0". Good info.
Editorial: Although the solar canopies may help defray the cost of electricity, the payback period for the capital expense probably exceeds 20 years. That's why so few charging stations have them. It's purely a PR stunt, but something we can all feel good about. And after all, that's worth something, too.
Not only are the "free" services disappearing, so has the "Alignment" thread on the TM forum. Maybe it got moved to private. One of the posters commented that they sent an email to Jerome Guillan and was told that he was out of the office for the next month.
So many dots to connect...
OK, free Ranger service is gone, free supercharging is now only for long trips, and now wheel alignments are no longer included in the $600/yr prepaid service. What's next?
As long as Elon does not request similar confidential treatment of TSLA SEC filings, there's nothing to worry about.
And big time record sales in Switzerland. 253 for June, 440 for the quarter.
Now it looks like the Q2 EU total will be close to 4200. If we add in 6900 for North America (per InsideEVs), that only leaves 400 for Asia/Pacific. I suspect InsideEVs might be about 1000 units heavy on their NA estimate; unusual for them.
Translate from Vietnamese to reveal the hidden message.
Is it just me, or does it seem like there's been a lot of cyber hacking going on these days?
To predict GP, I always start with the previous quarter's results. I calculate the average revenue per car and make adjustments for the new quarter. In Q2, FX and the model mix will certainly provide downward pressure. Then I look at GM and try to judge whether it might move up or down. For Q2, I'm expecting no change. From that, I calculate GP. For Q2, I expect GP will be slightly lower than Q1. At the same time, I'm expecting operating expenses to increase 10%. So it looks like a new record loss coming.
Tesla's guidance was that operating expenses (including R&D) would increase 50% in 2015. The reason that R&D is so huge is because they are competing in the auto industry. R&D is one of the biggest barriers of entry for any new car maker. Remember when Elon bragged that he could deliver cars at half the cost of othermakers? How's that working out?
R&D was the big hitter last quarter, but SG&A has been rising just as fast. Together, they went up by $550M in 2014, and will increase similarly in 2015. The fundamental problem is that gross profit not increasing at the same rate. It increased $426M in 2014 and will likely only increase $350M in 2015, assuming that MX launches strongly in Q4.
Wow, a new quarterly records in France and Belgium as well. Switzerland and Austria yet to report, but it looks like the EU total will be right around 4000 for the quarter (also a record). I guess the currency exchange isn't hurting sales.
A trade-in is an un-delivery. When you take a trade-in, you subtract one from your delivery total. Then when you sell it, you add it back.
"And CPOs are not cars delivered?"
In order to deliver a CPO, you must un-deliver it first. Therefore, the net delivery for a CPO is zero. Simple math.
JTF, thanks again for a well thought out response. I agree that the business model for Tesla is vastly different from a dealership. In fact, I don't think Tesla is approaching used sales as a profit center at all. It's just a part of the business to keep new car sales rolling. Essentially, it becomes purely an SG&A item. And if they make some money on it, all the better.
Just a follow-up on my earlier comment that CPO cars carried a significantly lower gross margin than new cars. Here's a data point to illustrate. A recent forum poster stated that he received $65k as trade-in for his Model S. He later saw it listed in their "buy used" for $71K. If there's someone on this board with dealership experience, maybe he can comment on this business model.
Actually, 23-24% is gross margin. Operating margin incudes SG&A and R&D. They have never reported a positive operating margin.