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Second Quarter 2012 Financial Results Q&A Conference Call on Jul 25, 2012 at 2:30 PM PT

The Q2 2012 Q&A conference call is scheduled for Jul 25, 2012 at 2:30 PM PT. Live audio broadcast will be available at:
http://ir.teslamotors.com/eventdetail.cfm?eventid=116710

I bet the number of listeners will break new records...! ;-)
(Just hoping they will be able to handle the load, technically.)

The Q2 2012 financial report with some basic news and the latest public numbers will likely be made available at the same URL shortly before the event.

Elon: "It's almost entirely on one shift. In principle we could comfortable have a production rate some time next year that is 50% greater than 20k. By the end of next year there's a pretty good chance we'll have a 30k/y continuous run rate."

Tesla will deliver 5000 Model S cars by years end. Here's the quote from the shareholders letter.

"As our capabilities scale, we plan to continue making customer deliveries on a methodical ramp with a target to deliver 5,000 units this year."

Elon: "There are probably a couple dozens suppliers where we have some challenges, where we either take it in-house or find a new supplier. Let me be clear that these are not big things. Some are incredibly silly things like [...], but these small things can be incredibly annoying. It's thinks like [...] interior trim."

Translation: Interior finish is still improving! :-)

Same holds true for final touches on the body, like how doors close etc., is still being tweaked.

Elon: "I'm a huge proponent of leasing, particularly for electric vehicles. [...] So we're gonna be very big on leasing in the future. We just didn't have to do that til now because there's currently more than enough demand for buying."

Deepak: "As of today we're looking at about 1000 people who have locked-in and fully configured their cars."

Elon: "There will be more demand for cars than we can reasonably produce during the next year. We will not have inventory."

GB: "Our goal is in the long run to have three to four months of reservations ahead of production, so we never have inventory expense, we basically aim at a run rate of three to four months ahead of production."

He implied that it is part of the model to adjust production to achieve this reservation/production ratio.

Elon: "We're seeing demand acceleration without trying."

GB: "We don't have a Model S at all in Europe or Asia, and we're sold out in Signature in EU [...]"

They seem simultaneously elated and nervous about the effect that "actually trying" to sell (with demo cars and so on) will have on sales. There were questions about whether 2013 would be pre-sold by Jan. 1, but I get the take-away that they will ramp up production to try and get within 3 months pre-order level, and hold there and follow demand.

That implies that if orders explode over the early part of the year they will have to crank up production considerably. Since EU will start seeing a few cars "on hand" in Q4, that could also impact production levels fairly soon.

The expression "a tiger by the tail" springs to mind. ;)

Overall, I very much like what I heard. All of us that have followed Tesla for a long time and have had reservations for a long time (about 3 years now for me) are obviously huge fans. Nonetheless, we have been very watchful (sometimes super critical)of how the S is now rolling out and have been quick to point out every little issue that we've seen during the test drives as well as with the ordering and delivery process. But make no mistake, it is with huge passion and pride that we do so. We want Tesla to be a big success and game changer. I certainly hope that any of the press or others reading these forums (including folks at Tesla) don't misread our comments or our commitment to the success of this company. I am also a long Tesla stockholder as are many of the current reservation holders. I think I speak for most of us when I say that we share Elon's commitment to quality and a little delay at this point to "get it right" only strengthens our passion and commitment. Hats off to all at Tesla!!

@john56
totally agree. hopefully the proof will be quite a few reservation holders being asked to configure their car in August and September. I can't wait!

@john56

+1

Well said - I couldn't have said it better myself!

1,000 configured now suggests that's about the total produced by late October. Wonder how many will be added the last week of July.

Here's an interesting remark that I wasn't able to transcript live although I tried to...

Elon: "We’re finishing up some construction activity on that. It’s looking like probably a September event, but that’s contingent on finishing some construction and getting all the permits and whatnot for the [super] chargers. But I’m really excited about that announcement. I think it’s way cooler than anyone realizes. I think it’s going to have a profound effect on how the public sees electric vehicles. There’s going to be a few surprises there. Almost no one knows the full story. There will be some cool things there."
http://seekingalpha.com/article/750201-tesla-motors-ceo-discusses-q2-201...

Yeq Volker, I noticed that one to. I guess it's Elon's next ace up his sleeve... I am curious ...

I think he said something along the same lines in the Q1 session. Got the impression then he was going to reveal all quite soon, but evidently the red tape was/is stickier than expected!

@john56 I agree completely!

He was also really excited about the SuperCharge network but isn't ready to share information on that yet.

BYT;
Sit up and pay attention! That's what we've been talking about. >:p

Sorry, like my wife tells me, I'm always in my own world that nobody understands and would be scared to visit.

sorry if this already mentioned, but was anything about 40 or 60 KWH batteries mentioned on the call? I had to step out for a few minutes during the call. I did hear Elon say that replacement batteries will be better than original. Maybe that should be spinned to mean that it is like replacing the engine on an ICE car.

My question?
Tesla is hemorrhaging cash, when will an infusion of money come and where do you expect it to come from?

kevjo: "Tesla is hemorrhaging cash, when will an infusion of money come and where do you expect it to come from?"

Elon: "Actually, I think that there is arguably some merit to raising incremental funding just to protect against an unforeseen event. I do want to emphasize that our cash flow projections require no funding raise at all. If we do not raise any funding, we can reach cash flow positive with decent margin. [...] The only two things we’re considering are raising zero money or a small amount. There’s not some third option. Then if we raised a small amount of money, it would be probably half of it for cushion value and then half of it for future projects which would be the Model X and the Gen III."
http://seekingalpha.com/article/750201-tesla-motors-ceo-discusses-q2-201...

"Tesla is hemorrhaging cash" Tesla is building a production line and is almost done doing it, so cash will stop flowing out and will start flowing in. Also, since most cars can be built on the same power train as the Model S, you can think of this current investment as a very long term one. Elon in the conference call said they will break even by the end of this year, earlier then he said the call before that. I believe he said they would be profitable in Q2 of 2013 during the June Shareholder Meeting. You need to spend money to make money, and Tesla is doing it very thoughtfully IMHO and have nowhere to go but up. We haven't even considered much the work they are doing for Toyota and Daimler deals.

Disclaimer, I am Long on TSLA even if it's just 100 shares... :)

@kevjo - Tesla lost $106 Million last quarter. Tesla has $210 Million in cash on their balance sheet. The cash infusion will come from 1) the remainder of the DOE loan 2) the 5,000 Model S' they sell. 5,000 units at an average price of $80,000 = $400,000,000.

Also forgot to mention, those aluminum stamping tools are very flexible and can adjust to many different car bodies when Tesla is ready to change things up like going Model S to Model X to GenIII to who knows??

They also have more DoE loan money that they haven't pulled out yet but plan on doing so soon.

@michiganmodels

"5,000 units at an average price of $80,000 = $400,000,000."

1000 @ ~95
4000 @ -85

= 435M

So what's 35M :)

@joefiorell - I agree with you. I wanted to be conservative on the estimate. :-)

If the average price is $70,000 in 2013, the quarterly revenue will be "at least" $350,000,000 ($70K @ 5,000 units) :-)

@joe and michigan;
in revenue-recognition terms, that's right, but in cash flow terms you need to take into account the differing deposits. Those move from liabilities to revenues as sales and deliveries occur, of course.


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