Tesla Q4 Conference Call In Its Entirety – Video

FEB 11 2018 BY ELECTRICCARSTV 37

Here it is, in video format.

The full Tesla Q4 conference call is now available for your enjoyment. It’s over an hour long, so there’s a lot to digest.

RELATED: Tesla Pushes Back Standard Model 3 Deliveries To Late 2018, Early 2019

MODEL 3 PRODUCTION NOTES: New Tesla Model 3 Battery Line Could Increase Output By Factor Of 4

Time notes (via Collin Anderson):

  • 1:25 elon opening thank-you’s
  • 3:36 elon model 3 production
  • 4:22 2018 maybe gaap profitable
  • 5:51 current production run rate and challenges? battery modules still limiting factor. we got complacent with batteries. subcontracting “zones” didn’t work. Coming up with new automation systems at gigafactory. Semi-automatic line is exceeding automatic lines, while we’re re-desiging automatic line, should arrive this Q from germany. Needs to get assembled. 2-2.5k per week after that. Next constraint is material conveyance at fremont.
  • 13:29 “congrats for the launch yesterday, that twin falcon landing was probably the sickest thing i’ve ever seen in my life… nutty, totally nutty” accounting question: negative working cap.
  • 15:03 elon’s long-term compensation plan – not a search for a new CEO, currently, but if there’s someone spectacular, they could take over so Elon could focus on design and engineering.
  • 16:14 2020 and model Y – starting investments Q3 Q4. Still targeting million units in 2020
  • 18:08 Tesla Semi investment and run rate? growing 50% per year… 100,000/yr semis in 4 years. might exceed unveiled spec. long-term tesla’s competitor strength is factory, not car.
  • 21:33 self-driving, is camera+radar enough? lidar can’t read signs and 400-700nm isn’t a good wave-length, can’t see through snow/dust. 4mm is better.
  • 25:06 model s/x margins – 20%? manufacturing efficiencies.
  • 26:53 constrained by 18650 battery cells for S/X? What about 21-70 cells?
  • 29:12 coast to coast drive, when available to customers? waiting until we have the general solution without using custom code. Amazed by AI improvements. Starts not so good, then good, the holy cow it’s good.
  • 31:53 manufacturing improvements? productizing giga-factory
  • 34:00 when generating free cash flow? we could do it maybe Q3, but it makes sense to invest in Model Y and energy products. There’s so much potential for manufacturing improvements. “grandma with walker can beat fastest production on earth” “should be jogging speed” “should be worried about aero-drag in factory”
  • 36:36 what’s in 2018 capex and what will production be? biggest is model 3, and working on the 10,000+/wk. energy storage, superchargers, stores. Model Y could be 1M/yr alone.
  • 41:16 Model 3 gross margins and ramp
  • 43:12 semi, super capacitors for breaking? ages ago I was going to get a PhD in capacitors, so i’m a big fan, but li-ion is so good that capacitors will not be needed. there’s a certain power to energy ratio, and once you have enough energy, you automatically have enough power. it’s actually less of an issue on the truck compared to performance vehicles. ion-migration like cars leaving a parking lot
  • 46:02 manufacturing road-blocks and building machines to build machines? toyota can’t ramp up any product in 3 months. can take 6-mo to year to ramp up product. thinking of factory as product. vertically-integrated product. it’s an engineering and production product. Like Toyota Production System?…. yeah, we don’t think so. TPS is more operational and lean flows of materials and supply chain. They’re great, but we’re looking at it from a technical lens, automation, robotics. Designing a factory like it’s a car: there’s still humans involved for regular maintenance, crashes, technology upgrades etc. But you don’t actually ship tiny people in the car to make it work. There’s people around the factory, but very few people in it. Model 3 is dramatically simpler to produce. Model Y should be simple too. FOXCONN quick ramps was because of human involvement and much simpler product. Our ipad is simpler than our center screen. John McNeal heading sales and service group is departing, reporting to Elon directly.
  • 51:13 shockingly want to followup on production of model 3… enough production experience? are there possibly other hurdles? can freemont handle 10,000/wk? battery most significant, then automated conveyance system. bottom level is all parts conveyance, then line is raised up above that. freemont should be able to handle 10,000/wk without major changes, though need to bring up south paint shop. relatively small capex for south paint. 20-30% more that Toyota and GM produced in the same place. Is there a limit to that plant? New facility for Model Y? For Model Y, we want to design-out all of the pain we’re currently going through. Pain level is extremely high. Many tesla people were at the factory Thanksgiving day, 7 days a week, no vacation.
  • 55:27 Eventually limit might be getting materials to the factory. Hyperloop? Seriously, we are looking at building tunnels because for example, we have a bunch of trucks moving seats back and forth. Limited by how many trucks we can dock at the seat factory that’s only a mile away. Eventually 50% more than GM/Toyota got out of the plant.
  • 57:22 working capital, got cash in the door. how repeatable is that?
  • 58:53 model s and x demands remain high because over-the-air updates. Any level uptake? Biggest item is people upgrading to full self driving. Anything with hardware 2 capable of full self-driving. Turns out we need to swap out computer to meet regulatory standards for self-driving. Standards may requires 5x better than human. Relatively minor expense to do that. Semi-automated driving doesn’t require any hardware upgrades, so 100% margin. Percentage of people upgrading? Not many people currently, especially because full self-driving doesn’t work yet. Eventually Uber/Lyft/AirBnB shared fleet.

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37 Comments on "Tesla Q4 Conference Call In Its Entirety – Video"

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mx
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mx

This is a very nice piece of work.
Thank you.

Benz
Guest
Benz

Indeed

+1

David
Guest
David

Be sure to catch the part where they say:
– Model 3 deliveries will be delayed, again.
– Model 3 standard range postponed until 2019.
– AWD Model 3 and deliveries to Canada will start before the standard range model 3.

Lamata
Guest
Lamata

Nice!

Viking79
Guest

Also be sure to read they expect GAAP profitability by Q3 (of course they wont turn much of a profit as they plan to invest that in Model Y and energy storage. Delaying the standard Model 3 is the best thing they can do for the company and its investors.

Steve
Guest
Steve

Sure, they expect…. Delaying the model3 is making them look very bad. Investors that are losing money because of the lack of confidence in the company doing what it says it’s going to do doesn’t seem like the best thing to me.

ffbj
Guest
ffbj

It’s long term gain vs short term pain.
This decision has taken some of the blush off the rose, but I think Tesla calculated correctly, that it was still the best decision.

I mean they do have the luxury of around 800k reservations for the M3, so they can pretty much call the tune.
If you don’t want to dance to it, there’s a mob outside who wants to get in and take your place.

Benz
Guest
Benz

“800k reservations”?

Where did you get that information from?

Ziv
Guest
Ziv

I thought that the reservations had peaked at just over 400,000 and that new reservations were just out numbering the cancellations and deliveries so that the total amount of net reservations was still rising.

Someone out there
Guest
Someone out there

No no, they have at least 23 trillion orders for the model 3.

Steve
Guest
Steve

I cancelled my reservation, so they can have it. If Tesla gets their stuff together enough to stop lying to it’s prosoectove customers and can actually produce the car they promised, maybe I’ll look at them again. If someone else comes out with a car that meets my requirements I’ll purchase that.

ROFLOL
Guest
ROFLOL

Ah, cancel troll.

ROFLOL!

Steve
Guest
Steve

Already done fluffer. I don’t spend north of $45k on cars.

Did you buy your flame thrower and hat yet?

Steve
Guest
Steve

Also, go back tot he last one where they said the bottlenecks have been resolved and they are now ramping to full production mode.

Jesse
Guest
Jesse

I cant believe that this is the Conference Call of a serious company.

Everyone of my holdings have the CC’s but its strictly business and not filled with excuses ”maybes” ”sausages” ”other companys businesses” This is like bunch of hippies discussing world politics. Everything else gets talked about except the things that matter

Steve
Guest
Steve

This is where the flutters take there cues from. No matter what happens there are always excuses, someone else fault…blah blah blah. And now the more affordable M3 that they promised is going to be almost two years late.

Pushmi-Pullyu
Guest
Pushmi-Pullyu

“Steve” continued his serial anti-Tesla FUD campaign:

“And now the more affordable M3 that they promised is going to be almost two years late.”

I suppose the Tesla Hater cultists have repeated that Big Lie often enough that they actually believe it. 🙄

It’s sad when someone starts believing his own lies! 🙁

Steve
Guest
Steve

Hey Fluffer #1 – you forgot your “go tesla” at the end of your comment, you’re slacking off. Must be daydreaming of Elon too much.

They promised a $35k car in 2017, they didn’t do it. They delayed til 2018, they still didn’t do it, now they delayed til 2019, want to bet they never do it?

Hauer
Guest
Hauer

Understood.
So sell your stock
Why are you waiting?

Get Real
Guest
Get Real

Better yet, hopefully Steve and the other serial anti-Tesla shills, shorters, and haters put their money where their online-mouths are and double down on shorting Tesla since according to them they are doomed and they can make serious money shorting them.

Of course, most of them are too cowardly to do that.

Steve
Guest
Steve

I don’t short stock, I only buy long in companies I believe in. Amazon, Apple, and Microsoft right now.

ffbj
Guest
ffbj

Only problem with that is that no other company makes a product that can hold a candle to any of Tesla’s.
Oh, but they have great conference calls.

Jesse
Guest
Jesse
There are a number of products that can and do compete with Tesla. That does not mean that Tesla does not build good products, in fact when I drove Tesla Model S 75D (2016) I can certainly understand what the buzz is all about. However talking down other manufacturers products is absolutely a sign of ignorance. So why should it raise a little bit of concern when a company is holding Conference calls like this? Because its obvious that the company has serious issues with its Financial situation and hearing this kind of talk means that they really dont really have a valid plan on how to turn themselves profitable. Yes Musk told us GAAP profitable by H2/18, well given his ability to hit timelines means that we can forget that. Other things Tesla had to say about Finances were: Look Fremont as a product…. Right, look at the plants history and see just how ridicilous this is. Margins are going to get better… Well they have a negative net margin so thats kind of obvious goal, as for Gross Margins… Well the problem is that Tesla is Cherry Picking when it calculates its Gross Margin you see they dont… Read more »
Brian
Guest
Brian

The problem with your argument is that the legacy car companies will not make EVs in Argentina numbers. Jaguar, Porsche and whomever you think will only bring about 40k EVs to the market per year. They not will not meet demand which will send them to Tesla.

Brian
Guest
Brian

Large, not Argentina, sorry.

Pushmi-Pullyu
Guest
Pushmi-Pullyu

LOL! That’s got to be the worst case of auto-correct I’ve ever seen — no joke!

Ziv
Guest
Ziv

Spell-check is not our friend!

Spider-Dan
Guest
Spider-Dan

Nissan-Renault has sold significantly more EVs than Tesla, which is not the same thing as the number of EVs Elon promises he’s going to sell Any Day Now (e.g. 100k-200k Model 3s in 2017).

bucricket
Guest
bucricket

I really think the explanation for the lack Lidar really makes sense. I’m a remote sensing scientist and so have worked with both Lidar and Radar. I never thought about the snow and dust particle problem so that in conjunction with cost and energy consumption of Lidar makes sense to use radar instead of Lidar.

Doggydogworld
Guest
Doggydogworld

There is no “instead of”. Most companies use camera+radar+lidar. Tesla leaves out the lidar.

theflew
Guest
theflew

Other companies use radar and cameras in addition to Lidar. Also rain and snow are exception conditions. What about all the other times when Lidar works extremely well identify objects?

Pushmi-Pullyu
Guest
Pushmi-Pullyu

It might make sense if Tesla was using high-resolution radar in place of LiDAR. But as I understand it, Tesla is just using cheap dopplar radar detectors, the same thing other auto makers are using for their ABS (Automatic Braking System).

Looks to me like Tesla is just being a cheapskate by refusing to use LiDAR. Well, that and Elon doesn’t like the idea of putting bulges on the roof of his cars to enclose LiDAR scanners.

Since this seems to be your area of expertise, Bucricket, what do you think of the following? (see links below)

The info re cost and requirement for spinning LiDAR scanners is outdated, since newer self-driving prototype cars are using five cheap fixed-mounted solid-state LiDAR scanners instead of a single expensive spinning one. But aside from that, so far as I know this is a pretty good summary of the state of the art. But it looks like you know more so I’d appreciate your opinion.

comment image

http://robotsforroboticists.com/lidar-vs-radar/

John
Guest
John

That’s it, I’m getting the 60 kWh Leaf..

Anon
Guest
Anon

Ick. No thermal battery management still? Have fun trying to go cross country with it.

NiceSmartPhace
Guest
NiceSmartPhace

That is what trains are for silly.

Pushmi-Pullyu
Guest
Pushmi-Pullyu
“camera+radar enough? lidar can’t read signs and 400-700nm isn’t a good wave-length, can’t see through snow/dust. 4mm is better.” Waymo and other companies developing self-driving cars are using all three types of sensors: radar, LiDAR and cameras. All of those have their advantages. Tesla has certainly shown it can use its cameras to “read” traffic signs. But a SLAM* virtual reality “picture” of the environment needs active scanners, such as LiDAR or high-resolution radar, which Tesla is stubbornly avoiding. Tesla, so far as I can see, is the only company with serious resources invested in self-driving cars which is refusing to use LiDAR. Tesla is also falling behind, quite noticeably, in the race to advance their self-driving tech. Coincidence? We’ll see, but I think not! *SLAM stands for Simultaneous Localization And Mapping technology, a process whereby a robot or a device can create a map of its surroundings, and orient itself properly within this map in real time. Besides, is it really true that LiDAR can’t “read” traffic signs? Or is it just that Tesla hasn’t even tried to use LiDAR for that purpose? One thing is certain: The cameras Tesla is using can’t read signs in the dark any… Read more »
NiceSmartPhace
Guest

what is the point of having signs if your car cannot read them?

that is, connect the signs to the cars, not the other way arguing.

but in fact that would be more like a train than a car, in that the number of steps required to automate a train is likely far fewer than automating a car.

sometimes this thought comes to mind: is the ev just bait and switch by the long-entrenched auto industry, and oil, to kick the can down the road on actually implementing sustainable transit?