Tesla Model 3

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Tesla Is Hemorrhaging Money Despite Billions In Gov?t Subsidies

http://dailycaller.com/2015/08/10/tesla-is-hemorrhaging-money-despite-millions-in-govt-subsidies/#ixzz44anUQlUl

Tesla Motors ?burned $359 million in cash last quarter in a bull market for luxury vehicles,? according to Reuters, causing the company to ?cut its production targets for this year and next.? Musk may even be forced to sell more stock to help plug the gap in the company?s finances.

Reuters reported that ?Tesla plans to build between 50,000 and 55,000 cars this year,? most of which are built-to-order. The company?s latest filings showed it ?delivered 11,532 cars in the second period and said it had an operating loss of about $47 million, for an operating loss per car of about $4,000.?

Interestingly enough, Tesla?s losses may be much higher than the company reports. Reuters notes that using ?generally accepted accounting principles, or GAAP, used by GM or Ford, Tesla?s operating losses per vehicle have steadily widened to $14,758 from $3,794 in the second quarter of 2014.?

News of Tesla?s huge losses comes after reports that Musk?s business ventures have benefited from $4.9 billion in federal and state government subsidies. Tesla Motors, where Musk is CEO, has gotten generous federal loans and benefits from state and federal tax credits encouraging people to buy electric cars.

?In all, Tesla buyers have qualified for an estimated $284 million in federal tax incentives and collected more than $38 million in California rebates,? the Los Angeles Times reported in May, adding that Tesla already secured ?a commitment of $126 million in California subsidies to companies developing energy storage technology.?
 
Irvinecommuter said:
Like how how the entire real estate and loan industries use tax deductions as an incentive to buy real estate?


There is a certain 'greater good argument" for real estate...this largesse benefits just one guy.
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No tax incentives for over 250K incomes?  Not many Irvinees will get the $7500 or watever. 
 
cheetos said:
But isn't it a tax credit? Doesn't everyone qualify
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So I pulled something up that over 250K.. u don't get nada.  Let me know if you find something that says different.
 
morekaos said:
Man, Musk is a genius...at using government subsidies to line his pockets.

http://www.wired.com/2016/03/sorry-dont-expect-tesla-model-3-cost-30k/

There are several reasons that price is almost certainly a fantasy. First, that $35,000 base model probably won?t have the fun options people want. Based upon how Tesla has priced its Model S sedans and Model X SUVs, crowd-pleasing features like all-wheel drive, a larger battery for more range, and that really cool ?autopilot? feature will add thousands to the sticker price. The base price of a Model S is 70 grand. Tesla won?t reveal the average sale price, but Morgan Stanley pegged it at $105,000 in 2014.

But even if you?re happy with the base model, there?s a bigger problem. The sub-$30,000 price point is based on a $7,500 federal tax credit (some states offer additional incentives, but nothing nearly so generous). That discount is designed to foster adoption by subsidizing the cost of what remains a fairly expensive technology without dinging automakers. Everyone from General Motors to Nissan relies upon tax credits to help move cars by keeping the cost of cars like the Model 3, the Chevrolet Bolt, and the Nissan Leaf below $30,000, a number consumers find palatable.

That federal tax credit won?t be around forever. It was designed to get automakers started, and applies to the first 200,000 electric vehicles a manufacturer sells in the US. Once an automaker hits that benchmark, the credit phases out incrementally over the following 12 months.

That $7,500 tax credit is ?incredibly important,? especially at the Model 3 price point, says Rebecca Lindland, a senior analyst at Kelley Blue Book. ?One could argue they sort of wasted their credits on the very wealthy, people who didn?t need it,? she says.
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Many companies "finance" their products based on government incentives. People pay high prices for meds to finance the research that was done by the pharma company even though a large part of the research might have been done at a university and that was funded by the government.

Tesla's strategy was to build cars initially that could ultimately finance a mass market product like the Model 3. Using some government subsidy for innovation ain't that bad. Remember the cold-war era when the government funded a lot innovations in aerospace that helped advance the country. This is similar, except in a different field.
 
Also, for the state of California there is an income cap. If you make more, than you don't qualify for the CA EV rebate.
 
eyephone said:
Also, for the state of California there is an income cap. If you make more, than you don't qualify for the CA EV rebate.
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right.. this is what I saw. 
 
HomeOwner Irvine said:
morekaos said:
Man, Musk is a genius...at using government subsidies to line his pockets.

http://www.wired.com/2016/03/sorry-dont-expect-tesla-model-3-cost-30k/

There are several reasons that price is almost certainly a fantasy. First, that $35,000 base model probably won?t have the fun options people want. Based upon how Tesla has priced its Model S sedans and Model X SUVs, crowd-pleasing features like all-wheel drive, a larger battery for more range, and that really cool ?autopilot? feature will add thousands to the sticker price. The base price of a Model S is 70 grand. Tesla won?t reveal the average sale price, but Morgan Stanley pegged it at $105,000 in 2014.

But even if you?re happy with the base model, there?s a bigger problem. The sub-$30,000 price point is based on a $7,500 federal tax credit (some states offer additional incentives, but nothing nearly so generous). That discount is designed to foster adoption by subsidizing the cost of what remains a fairly expensive technology without dinging automakers. Everyone from General Motors to Nissan relies upon tax credits to help move cars by keeping the cost of cars like the Model 3, the Chevrolet Bolt, and the Nissan Leaf below $30,000, a number consumers find palatable.

That federal tax credit won?t be around forever. It was designed to get automakers started, and applies to the first 200,000 electric vehicles a manufacturer sells in the US. Once an automaker hits that benchmark, the credit phases out incrementally over the following 12 months.

That $7,500 tax credit is ?incredibly important,? especially at the Model 3 price point, says Rebecca Lindland, a senior analyst at Kelley Blue Book. ?One could argue they sort of wasted their credits on the very wealthy, people who didn?t need it,? she says.
Click to expand...

Many companies "finance" their products based on government incentives. People pay high prices for meds to finance the research that was done by the pharma company even though a large part of the research might have been done at a university and that was funded by the government.

Tesla's strategy was to build cars initially that could ultimately finance a mass market product like the Model 3. Using some government subsidy for innovation ain't that bad. Remember the cold-war era when the government funded a lot innovations in aerospace that helped advance the country. This is similar, except in a different field.
Click to expand...

That is true, but EVERYTING this guy does is government subsidized...Tesla, Solar City, Space Ex and now the Bullet Tube are ALL based on government (taxpayer) support.  Give me unlimited funds and I am sure I can come up with one or two good ideas. Again, this is all for one guy.
 
"About 116,000 plug-in cars were sold in the U.S. in all of 2015. Tesla just pre-sold 180,000 Model 3 EVs in 24 hrs. Musk estimated the average car would sell for roughly $42,000, including optional features, for total sales of about $7.5 billion. "
 
SubSolar said:
"About 116,000 plug-in cars were sold in the U.S. in all of 2015. Tesla just pre-sold 180,000 Model 3 EVs in 24 hrs. Musk estimated the average car would sell for roughly $42,000, including optional features, for total sales of about $7.5 billion. "
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42k or 35k

 
35k is base base, with no options added, he estimates people would choose some options, so avg is 42k

btw, when is the next china owned fisker coming out to compete in all of this... plus that faraday company
 
AW said:
35k is base base, with no options added, he estimates people would choose some options, so avg is 42k

btw, when is the next china owned fisker coming out to compete in all of this... plus that faraday company
Click to expand...

That's one of my point price keeps potentially going up. This is just one day after the deposit.
 
Federal rebate is 7500 tax credit with no income cap. This follows a phaseout schedule where you get 100% of the credit in the half year it sells 200k. 50% in the second half, 25% in the first half of following year. Then finally nothing.

Only the $2500 California credit is restricted by income. But it's pretty high too...500k for joint filers.
 
From all places the LA Times.  Read this article in its entirety...the emperor has less clothes.

http://www.latimes.com/business/la-fi-hy-musk-subsidies-20150531-story.html

Elon Musk's growing empire is fueled by $4.9 billion in government subsidies

Los Angeles entrepreneur Elon Musk has built a multibillion-dollar fortune running companies that make electric cars, sell solar panels and launch rockets into space.

And he's built those companies with the help of billions in government subsidies.


Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.

"He definitely goes where there is government money," said Dan Dolev, an analyst at Jefferies Equity Research. "That's a great strategy, but the government will cut you off one day."
...But public subsidies for Musk's companies stand out both for the amount, relative to the size of the companies, and for their dependence on them.

"Government support is a theme of all three of these companies, and without it none of them would be around," said Mark Spiegel, a hedge fund manager for Stanphyl Capital Partners who is shorting Tesla's stock, a bet that pays off if Tesla shares fall.
 
eyephone said:
AW said:
35k is base base, with no options added, he estimates people would choose some options, so avg is 42k

btw, when is the next china owned fisker coming out to compete in all of this... plus that faraday company
Click to expand...

That's one of my point price keeps potentially going up. This is just one day after the deposit.
Click to expand...

The lowest price should be evident that it's the base.  Much like Irvine new model starts at low millions. Then the upgrades come, then it turns out to be mid million.

Somehow I don't believe the hedge fund managers only short the stocks.  Wouldn't they hedge by buying options also or some combinations thereof.
 
I wasn't impressed by the model 3 exterior or interior at all.  Especially the inside.  Looks like Ikea plastic furniture with an iPad glued to the middle console.  How innovative.  Given the stunning interior of the Model S, I would have expected more from them, even for an entry level sedan.
 
irvinehomeowner said:
I don't understand the lines, can't you just reserve online?
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You can now, but I don't think you could've yesterday?
Basically there'll be 130k or so people ahead now.
 
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