Why the Mustang Mach E is better than the Tesla Model Y

[ARK]

The Mach-E and a few other recent, serious competitors have also shown that Tesla’s battery tech is nothing particularly special compared to what is available in the broader automotive market. So much for those discussions of whether their batteries are 5, 10, or 15 years ahead of everyone else's.

I suppose that’s why the new focus is on claiming Tesla is really an AI and robotics company, and that’s what the stock value reflects and has reflected all along.

I guess you gotta have some pretense to support those eye-popping valuations.

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[All Hat No Cattle]

I suppose that’s why the new focus is on claiming Tesla is really an AI and robotics company, and that’s what the stock value reflects and has reflected all along.

Yeah, LOL. An old saying goes "If you can't dazzle them with brilliance, baffle them with bulls**t. Musk is very good at baffling.

Case in point. As posted in Post #1,228, above, Tesla posted $438 Million in profits, all from regulatory credits, not from vehicle production.

In the same time period, Ford posted $3.3 Billion in profits, all from vehicle production and a non-cash gain in their Rivian investment.

So Musk made a profit of around $101 Million trading in Bitcoin, and Ford made a gain of $900 Million investing in Rivian. Interesting.

Now, Ford stock dropped today, all because of the lousy chip shortage, not because of lack of demand. Ford can't keep up with current vehicle orders, read the article.

Ford Warns Chip Shortage Will Worsen, Posts Highest Quarterly Net Income in Years

Auto maker’s bottom line reversed a $2 billion loss from a year earlier

Updated April 28, 2021 6:52 pm ET

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Ford Motor Co. F -10.22% posted $3.3 billion in net income—its highest quarterly result in years—but warned the financial toll from the continuing global computer-chip shortage will likely worsen.

Ford’s bottom line, which was fueled by strong pricing in North America, reversed a $2 billion loss from a year earlier, when the Covid-19 pandemic froze North American production.

The company posted pretax first-quarter profit excluding one-time items of $4.8 billion, or 89 cents a share, easily surpassing the 22 cent average estimate of analysts surveyed by FactSet. The result included a $900 million noncash gain from Ford’s investment in electric-truck maker Rivian Automotive LLC.

Revenue rose 6% to $36.2 billion.

Ford said the chip shortage will cut $2.5 billion from adjusted pretax profit this year, the high range of the $1 billion-to-$2.5-billion estimate it provided in February. The company said the lack of semiconductors will force it to cut second-quarter production in half, but it expects the situation to improve after June.

Ford finance chief John Lawler said a fire at a semiconductor supplier in Japan in March exacerbated a chip shortfall that had already hit auto makers hard at the start of the year.

“We now expect semiconductor shortages to get worse and bottom out” in the second quarter, he told reporters during a conference call.

Major auto makers since January have been forced to cut vehicle output and adjust production schedules to keep assembly lines running for more profitable models. Semiconductors used in electronic-vehicle controls are in short supply as surging global demand for smartphones, laptops and other electronics surges during the pandemic.

The supply problems are marring an otherwise favorable backdrop for Ford to accelerate a turnaround plan rolled out by Chief Executive Jim Farley. Pent-up demand for cars, federal stimulus and continued low interest rates have driven shoppers back to dealerships in recent months.

Mr. Farley took the top job in October, vowing to squeeze costs and fix nagging operational problems, including rising warranty costs and stumbles on high-profile vehicle launches. Ford said warranty costs during the first quarter were $400 million lower than the year-earlier period.

Ford in the first quarter managed to avoid cutting production of its biggest profit generator, the F-150 pickup truck. But the company has canceled multiple weeks of F-150 production in April because of the chip crunch and said last week that it won’t resume full production until mid-May.

Research firm AutoForecast Solutions estimates that the chip shortage has cost Ford more than 35,000 units of F-150 production so far this year, with the bulk of those cuts coming in March and April. That would account for roughly 10% of F-150 production over that period at Ford’s normal pace.

Mr. Lawler said Ford has set aside about 22,000 vehicles that were built without needed semiconductors and will equip them once supplies become available.

General Motors Co. GM -4.81% , which reports first-quarter results next week, has largely sidestepped production cuts for its big pickup trucks and SUVs, although it has reduced output on most other models in North America.

Write to Mike Colias at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the April 29, 2021, print edition as 'Ford Sees Bumps Ahead Despite Net Gain

 

[pt19713]

Tesla is still growing and expanding. Building two new factories can't exactly be cheap, I'd imagine. Many other companies in the growth phase aren't going to be posting profits, so Tesla is no different. If they aren't posting profits in 5-8 years then it's time to start worrying if you're an investor.

 

[ARK]

Tesla is still growing and expanding. Building two new factories can't exactly be cheap, I'd imagine. Many other companies in the growth phase aren't going to be posting profits, so Tesla is no different. If they aren't posting profits in 5-8 years then it's time to start worrying if you're an investor.

Yeah but the thing is, their valuation is so high, it doesn’t seem like Tesla would ever have the profits to meet that valuation within the four corners of the car industry. They would need to sell something like as many cars as Toyota per year but make profit per vehicle something along the lines like Porsche does on their cars.

Particularly unlikely given that it’s relatively easy to make BEVs compared to ICEs and competition will keep Tesla from reaching that scale or profit per vehicle, even if we assumed Tesla objectively made the best vehicles in the future. Just look at all the years the Big 3 survived and still made a ton of sales despite making some pretty awful cars in the 80s and 90s compared to competing Japanese marques.

A charitable view of all this is that Tesla’s value goes beyond what they can ever hope to achieve in the car industry alone. An uncharitable view is that they are a meme stock like Gamestop, where the market value is totally divorced from what the company can ever reasonably hope to achieve.

 

[Mirak]

Well, today looks like a good day to introduce some facts to back up that quote above.

Because the MME is being sold to make a profit, while Tesla has never sold their vehicles at a profit. So they are selling vehicles at a loss, in order to make money on carbon credits.

Their latest earnings report from yesterday proves that point.

Tesla makes their profit from selling regulatory credits and trading in questionable investments. Don't believe that ? Proof below, in Bold. Enjoy.

So as you know I’m a big fan of the MME and I liked it much better than the MY… but why does Tesla’s business model matter? Either you like the car or your don’t. I don’t really care that Tesla “loses money” on its cars, or that the MME’s “make money.” And I think the profitability of the MME is somewhat debatable after factoring in R&D (which I realize is an oversimplification).

 

[pt19713]

Yeah but the thing is, their valuation is so high, it doesn’t seem like Tesla would ever have the profits to meet that valuation within the four corners of the car industry. They would need to sell something like as many cars as Toyota per year but make profit per vehicle something along the lines like Porsche does on their cars.

Particularly unlikely given that it’s relatively easy to make BEVs compared to ICEs and competition will keep Tesla from reaching that scale or profit per vehicle, even if we assumed Tesla objectively made the best vehicles in the future. Just look at all the years the Big 3 survived and still made a ton of sales despite making some pretty awful cars in the 80s and 90s compared to competing Japanese marques.

A charitable view of all this is that Tesla’s value goes beyond what they can ever hope to achieve in the car industry alone. An uncharitable view is that they are a meme stock like Gamestop, where the market value is totally divorced from what the company can ever reasonably hope to achieve.

That's a completely separate topic (valuation), which I agree with you. One reason why I sold all my Tesla shares.

 

[All Hat No Cattle]

Particularly unlikely given that it’s relatively easy to make BEVs compared to ICEs and competition will keep Tesla from reaching that scale or profit per vehicle, even if we assumed Tesla objectively made the best vehicles in the future. Just look at all the years the Big 3 survived and still made a ton of sales despite making some pretty awful cars in the 80s and 90s compared to competing Japanese marques.

Yes, I agree with that. In a discussion on the F-150 forum, comparing ICE's to BEV's, I posted this current Ford V-6. A picture is worth a thousand words. And that is just the engine...

It is all about the software, not the hardware. And once you build one software package, duplication is cheap.

 

[ab13]

I don't get it. Are you saying that's why Ford makes them in Mexico? Because Ford's european customers would rather have a car made in Mexico than the USA?

What is your point?

I would say it's because they would rather pay thousands less. This automotive nonprofit points out a $25000 car could save about 10% in tariffs for sale in Europe. A $50000 car could save $5000 in tariff.

https://www.cargroup.org/the-move-to-assemble-vehicles-in-mexico-is-about-more-than-low-wages/

 

[All Hat No Cattle]

I don't know what you mean. Most people believe that batteries currently cost $150 per kilowatt hour.

What does that mean? Please explain.

 

[oadesign]

Test drove ID.4 Friday. Test drove the Model Y on Sunday, but only for comparison, fully expecting to go with ID.4. On a whim, test drove the MME on Monday, just to check on it, expecting the difference wouldn’t justify the higher price. Wrong! It exceeded both. Ordered the MME on Tuesday, due to it being the best of the three, plus all the reasons stated above.

 

[Kamuelaflyer]

You can believe an uncollaborated Reddit account without any other supporting evidence in which the "journalist" couldn't even get ahold of the poster to confirm the claim. I tend to think it's just a Tesla troll post.

IMO, it's not even "journalism" to echo unverified Internet claims. Journalistic integrity is now a foreign concept.

Don’t be such a tool. The original article came from an SFO Bay Area newspaper piece, and had verification of the roof on I-580 by the CHP. Plus a comment from Tesla about it after the fact.

You’re entitled to believe what you want, but you’re wrong.

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