Tesla CEO Elon Musk: Here’s Why We Don’t Report Monthly Sales Figures

2 years ago by Eric Loveday 37

2014 Monthly Sales Chart For The Major Plug-In Automakers *Estimated Tesla NA Sales Numbers – Reconciled on Quarterly Totals from Earnings Report (Q1 Sales reported @ 6,457-3,000 Intl Delivers, Q2 7,579 total-approx reported International registrations, Q3 7,785 total deliveries ~ 3,900 US) *Fiat 500e data estimated for Jan/Feb

2014 Monthly Sales Chart For The Major Plug-In Automakers *Estimated Tesla NA Sales Numbers – Reconciled on Quarterly Totals from Earnings Report (Q1 Sales reported @ 6,457-3,000 Intl Delivers, Q2 7,579 total-approx reported International registrations, Q3 7,785 total deliveries ~ 3,900 US) *Fiat 500e data estimated for Jan/Feb

Elon Musk

Elon Musk

Despite repeated prodding, Tesla Motors refusing to report monthly sales figures.

On the recent conference call, John Lovallo of Bank of America asked Tesla CEO Elon Musk if the automaker would ever comply with the industry norm of reporting monthly sales.  Here’s the reply from Elon Musk:

“Um, no. Sorry.”

“Part of the reason why we don’t release the monthly deliveries number is just because it varies quite a lot by region and the media tends to read all sorts of nonsense into the deliveries. So, we’ll have 1,000 cars reach a country one month and none the next month or 100 the next month trickle in because those are the numbers that were registered one month versus the next. People will say, ‘oh, wow, Tesla sales drop by a factor of 10. Well, no, the boat arrived in January and not all the cars got registered in January and some got registered in February and in March it’s back up again.”

“People assume deliveries are a proxy for demand, and that’s not the case. It is the case for other car companies but in our case, it really needs to be parsed into orders and deliveries. And bear in mind, there are a lot of things we could do to amplify orders. Orders is not a true measure of demand, it’s just a measure of what we need to do to meet our production and deliver number.”

So, let’s assume that Tesla will never release monthly sales figures then.

That makes our job of reporting Tesla sales far more difficult, but our track record shows that we’re as accurate as can be without Tesla’s official numbers – perhaps because each month we research exactly what is happening behind the scenes with Tesla’s Fremont factory and what the specific allocation and production story for the US is each month – which we explain every 30 days or so in out Monthly Plug-In Scorecard.

In looking at our chart (above) you can see Mr. Musk’s point of significant ‘peaks and valleys’ in the month-to-month sales numbers as Tesla tries to produce and ship a single car (from one assembly plant) around the world.

Still, we’d much rather not have to do the work of figuring out sales; for a still not exactly precise result.  It would be swell for Tesla to release the sales number (like everyone else) and let the market/analysts use their big-boy pants and figure out what it means for themselves.

Oh…and we’ve got Tesla sales tracked around the globe too.

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37 responses to "Tesla CEO Elon Musk: Here’s Why We Don’t Report Monthly Sales Figures"

  1. Big Solar says:

    A great oppurtunity to bet on trolls here. I got 5 bucks on ST.

    1. Jay Cole says:

      On a personal note (or a completely selfish one), if Tesla would report monthly sales in the US, it would save me probably 6-10 hours of grunt work trying to figure what’s going on.

      …I could learn a new instrument with all that extra time.

      /jazz flute ftw

      1. Big Solar says:

        You guys do work too much, but we appreciate it.

        1. leaf owner says:

          +++++++++

      2. Bonaire says:

        Your work plus the blogspot site ev-sales are a good combination and do provide some clarity. And enough clarity to match Tesla’s unannounced numbers – meaning therefore there is no reason for Tesla not to report numbers.

        For example, on the Tesla forum, a Norwegian member already indicates 202 registrations in Norway for November, 2014. So that is slightly “up” compared to recent trend. But not a lot. Is it really fun to go scooting around the web to guess what is going on? Well, the obfuscation does allow for hype to rein in the day and make the benefit of the doubt continue ongoing.

        What does not occur is a clear picture of what has happened with past finished goods. Cars already produced or cars built between customer orders so as to be inventory for the scattering of sales sites. Call them “loaners” if you will but effectively, all loaners are speculative cars built for future sales within 3-6 months. Telsa only needs to produce “loaners” because they say that they want to provide a better experience to their customers. It does cost a lot to do so in terms of depreciation of the inventory car which they can write off against the lower sales price. So, are “loaners” really a depreciating asset that then allows for higher sales numbers by offering highly discounted cars soon after? If they did not offer cheap loaners, do you guys think that sales would be down if all cars needed to be special ordered?

    2. LuStuccc says:

      Ok you win, ST Is See Through and he did appear. I should have known. King of trolland.

  2. liberty says:

    Jay, maybe they can give you a leak number for the US. I think they don’t want official numbers especially in europe and china.

    1. Jay Cole says:

      Tesla does have a new head of communications starting mid-month, they ‘perhaps’ could be slightly more forthcoming with US figures in some regard…but I (personally) don’t hold out much hope on that.

      I think you will see more US sales hints/disclosures once the X is running and production is much higher overall (and equitable to demand) – evening out the short-term variance.

  3. JRMW says:

    I see why people want monthly numbers but I also think that things are fine the way they are.

    American business is far too reliant on constant streams of very short term data and American markets are overly reliant on massive amounts of short term trades. The concept of a stock holder being a stake holder are long dead.

    A true stakeholder is a buy and hold person. Quarterly data is sufficient.

    Day traders and algorithm traders are most vocal about monthly data. They have little interest in Tesla and really only care about churn and playing volatility.

    The rest of us can get by with quarterly data and the insights of the awesome folk here at inside EVs.

  4. JRMW says:

    On a side note,
    I personally feel that Tesla stock is well in bubble territory.

    However it allows Musk the capital to push his vision. He is quite adept at playing the markets with innuendo, interviews, subterfuge, and social media… But has backed it up with his product.

    He has been honest and open that HE DOES NOT CARE if Tesla goes bust so long as it pushes his EVs forward.

    Don’t like that? Don’t invest in Tesla. Think he’ll fail early? Short them. But don’t think he’s going to help you ruin his vision.

    He’ll report monthly data the second it furthers his goals.

    With Trsla stock ever upward, why bother?

    Disclosure-I have $0 in the stock market since 2009.

    1. ffbj says:

      Somehow telling people you have not been in the stock market the past 5 years, perhaps the greatest of bull market in history, does not give one a great deal of confidence in your analysis of Tesla, one way or the other.

      1. JRMW says:

        You misunderstand me completely
        my disclosure is meant to show that I have no interest in Tesla stock (I have tremendous interest in Tesla the company) one way or another. Obviously I could be lying

        Your perception of my investment acumen is immaterial to my musings here.

        Read my words and you will see that my concepts are sound regardless if you think my decision to exit equities in 2009 was wise or not. (FWIW I am extremely content not owning stocks these last 5 years and have no plans to add any anytime soon)

        1. ffbj says:

          “Your perception of my investment acumen is immaterial to my musings here.”

          It is not a perception it is factual data that you yourself submitted that allows me too make such statements regarding stock analysis. I do not perceive that you do not understand, care too, or need to own stocks, you said that of yourself. I am merely saying that if you are going pontificate on the fair value of a stock it does not give one much confidence that such musings, as you call them, carry any weight. That’s a judgement on my part.

          1. JRMW says:

            You continue to confuse my investment acumen with my current barely-known-to-you investment portfolio.
            Do my ideas here sound like a novice? Are they naive? If so, why? Simply because you saw a dollar sign followed by a zero? Because you assume I had no better investment than the equities market these last few years?

            For many years my side hobby was the derivatives market specifically credit default swaps and collateralized debt obligations. Does that make my words more worthy? Because I guarantee you that the quality of information one gets in the financial world is often not correlated with the portfolio held by the speaker.

            I will simply restate what I said before- read my musings, and decide if they make sense or not. If they do not, ignore them or debate the merits of my argument.

            I’ve been wrong before and I’ll be wrong again. Happens here in the EV world all the time since I’m pretty new to it. Heck, I thought the audi etron was going to be AWD!!

    2. no comment says:

      the price of tesla stock only impacts tesla’s ability to raise capital when it issues stock. day to day fluctuations have no impact. the main reason why stock price management is important is to please owners of tesla stock; because if the shareholders are unhappy, musk could get fired.

      1. JRMW says:

        Tesla can borrow money and the rates and terms can be tied to stock price.

        Firing Musk would be difficult as he owns 23% of all issued stock and is an iconic CEO.

        Who would replace him? A legacy car executive? Another tech star?

        By the time he is fired Tesla would likely be in a death spiral.

  5. Most stupid argument ever, because every civilized state of the world does have public monthly car registration statistic.

    1. JRMW says:

      Then investors and speculators can do some work to get those numbers.

      Meaning no reason why Tesla has to release the data.

      I could tell you who I am and the value of my house, but I prefer not to and it’s legal for me to not disclose that to you. So you could search through all my postings here and elsewhere and use Google and various State agencies to figure out my name, address, and house value.

      Would I really care? No. But I’d find it humorous that you went through all that work for no real benefit.

      Likewise… Let speculators waste their time with this monthly data. It doesn’t change anything for now because Tesla valuation is built on hopes and dreams, not on volatile monthly profits and deliveries.

  6. Yeah they do vary a lot, for instance in October they reached a whopping 127 in Europe – lowest number since deliveries started.

    I know, I know. They’re in transit. In a ship. The same ship that didn’t arrive last quarter, I see, cause they registered less than 1,500 – though that looks marvelous compared to last month’s result.

    https://www.dropbox.com/s/2iy0ya1kuqmgd8l/Tesla%20revenues%20vs%20deliveries.xlsx?dl=0

    While you check my Excel file you can explain how Tesla got $242 million from Europe (excluding Norway) while managing to register only 1,056 cars. That’s indeed an extraordinary ASP.

    PS: these are actual registrations, not “estimates”.

    1. Big Solar says:

      Are you sure you dont owe me 5 bucks ? ST, is that you?

    2. JRMW says:

      Not to get all zen, but it really doesn’t matter if there were 100 or 1000 registrations. As I said above, tesla stock is valued based on potential and has nothing to do with earnings or deliveries or profits or any short term quantitative data point.

      It’s just like Facebook or Google after they went public.

      Tesla is 100% valued on whether or not tesla can get a viable model 3 out in 3-4 years. Hopes and dreams.

      October numbers don’t matter. People like to pretend that they do but that ignores the fundamental nature about how technology momentum stocks are valued by our speculative market.

      Musk understands this. He is playing the market, with their approval.

      It will work until it doesn’t.

      But the tipping point won’t be some monthly regional registration number.

    3. LuStuccc says:

      With those “NA” s your analysis cannot be taken seriously, nor without citing your sources.

      1. LuStuccc says:

        How many cars were delivered or en route to China? Japan? In october?

    4. LuStuccc says:

      Tesla is expanding his sales… Again… You will have to add Australia to your file 😉

  7. Chris O says:

    Makes perfect sense. The way Tesla delivers in batches for different markets will cause wild fluctuations in deliveries which can easily be spun to create a hype about declining demand by those that are interested in that sort of stories or those that don’t understand the difference between deliveries and demand.

    It’s routinely done on this forum in fact.

    1. JakeY says:

      That’s doubly true because Tesla doesn’t work with an inventory model like all the other car manufacturers, plus they have a waiting list.

    2. Bonaire says:

      If they run the line consistently and ship consistently, then sales should eventually be primarily consistent through all markets.

      Except, we know they discount loaners to clear out inventory at the end of quarters. There will always be the “silicon valley slam”. This happens in many software companies offering high discounts to large customers to close big orders usually on the last few days of a quarter. Tesla does the same with loaner and demo cars.

  8. Omar Sultan says:

    Its a nice concept, but it hinges on analysts actually doing some work, which is kinda like expecting journalists to do some work before posting on car fires.

    The reality is that analysts are in a competitive market and one of the easiest ways to get noticed is to make some bombastic claims about some hot company (there is a whole cottage industry around APPL), so we get things like the recent “missing 3,000 Teslas in China” reports, which then gets picked up by the aforementioned lazy journalists, because, hey, “news” sites need clicks to pay the bills too, and TSLA news is always good for some controversy.

    Essentially, this is the corporate version of “don’t feed the trolls.”

    1. Chris O says:

      Like the man said: “you can’t handle the truth”.

      One strategy to deal with that conundrum is to use quarterly figures to even out the fluctuations. That’s how you avoid monthly dips in specific markets to turn into a “Tesla is failing” media frenzy.

      A respectable strategy because selling cars is all about the public having faith in your future as a company.

      1. See Through says:

        Comparing the quarterly or YTD numbers would be good, as you say. But, Musk himself likes to compare monthly numbers in his tweets when such comparisons are good. Look at the tweet about 26% yoy increase in September sales. And he also likes not to say anything about quarter to quarter comparison.
        So, there must be a reason why a CEO diverts attention to monthly comparison when it is good, and yet not divulge the monthly stats regularly.

        1. JakeY says:

          If I remember correctly, he only brought up monthly because the article he was rebutting had a headline that said Tesla sales dropped 26% in September.

            1. JakeY says:

              I dug it up. Wardsauto estimated Tesla sales dropped in September year-over-year from 1700 to 1577, a drop of 7-8%.
              http://www.ibtimes.com/september-2014-tesla-model-s-sales-ceo-elon-musk-says-global-sales-hit-record-1714929

              Elon says their data was wrong with a growth of 65% year-over-year for September.

              The 26% is a YTD number including September, but was derived from Ward’s monthly estimates, not from quarterly estimates.

    2. See Through says:

      Exactly like the bombastic claims, that Tesla is the only important car company in the world, or that Tesla will reach $400 per share (based on a factory tour).

  9. no comment says:

    i tend to agree with musk on this point: tesla is a small volume auto manufacturer; so small volume swings, which would be insignificant to a large manufacturer, could result in large percentage swings. since many “analysts” just look at percentages, this could result in highly misleading analyses.

  10. Nix says:

    I’m completely OK with Tesla reporting quarterly. The monthly estimates have proven to be so accurate that the real numbers really don’t matter. The estimates have told the story.

  11. Around the Block says:

    I think he won’t report monthly numbers because, like all hot cars, the Model S is slowing down and Musk won’t face the music. It’s much easier to monkey around with numbers when you report quarterlies rather than monthlies.

    Musk comes from Silicon Valley, the land of made-up numbers. I wouldn’t trust anything he says.