Unnamed: 0 int64 | symbol string | quarter int64 | year int64 | date string | company_name string | company_id float64 | text string |
|---|---|---|---|---|---|---|---|
7,000 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Great. Thank you very much, Elon, and Vaibhav has opening remarks as well. |
7,001 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Thanks. As Elon mentioned, the Tesla team rose to the occasion yet again and delivered on all fronts with some notable records. In addition to those records, we saw our automotive deliveries go sequentially. I would like to thank the entire Tesla team for their efforts in delivering a great quarter. On the auto business front, affordability remains a top of mind for customers, and in response in Q2, we offered attractive financing options to offset sustained high interest rates. These programs had an impact on revenue per unit in the quarter. These impacts will persist into Q3 as we have already launched similar programs. We are now offering extremely competitive financing rates in most parts of the world. This is the best time to buy a Tesla, I mean, if you are waiting on the sidelines, come out and get your car. We had a record quarter on regulatory credits, revenues, and as well. On net, our auto margins remained flat sequentially. It is important to note that the demand for regulatory credits is dependent on other OEMs plans for the kind of vehicles they are manufacturing and selling as well as changes in regulations. We pride ourselves to be the company with the most American-made cars and are continuing our journey to further localize our supply chain, not just in the U.S., but in Europe and China as well for the respective factories. As always, our focus is on providing the most compelling products at a reasonable price. We have stepped up our efforts to provide more trims that have estimated range of more than 300 miles on a single charge. We believe this, along with the expansion of our supercharging network, is the right strategy to combat range anxiety. Since the revision of FSD pricing in North America, we've seen production rates increase meaningfully and expect this to be a driver of vehicle sales as the feature set improves further. Cost per vehicle declined sequentially when we removed the impact of Cybertruck. While we are experiencing material costs trending down, note that |
7,002 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | sequentially when we removed the impact of Cybertruck. While we are experiencing material costs trending down, note that there is latency on the cost side and such reductions would show up in the P&L when the vehicles built with these materials get delivered. Additionally, as we get into the second half of the year, it is important to note that we are still ramping Cybertruck and Model 3 and are also getting impacted by varying amounts of tariffs on both raw materials and finished goods. While our teams are working feverishly to offset these, unfortunately it may have an impact on the cost in the near-term. We previously talked about the potential of the energy business and now feel excited that the foundation that was laid over time is bearing the expected results. Energy storage deployments more than doubled with contribution not just from Megapack, but also Powerwall, resulting in record revenues and profit for the energy business. Energy storage backlog is strong. As discussed before, deployments will fluctuate from period to period with some quarters seeing large increases and others seeing a decline. Recognition of storage gigawatt hours is dependent on a variety of factors, including logistics timing as we send units from a single factory to markets across the world, customer readiness and in case of EPC projects on construction activities. Moving on to the other parts of the business, service and other gross profits also improved sequentially from the improvement in service utilization and growth in our collision repair business. The impact of our recent reorg is reflected in restructuring other - on the income statement. Just to level set, this was about $622 million of charge, which got recorded in the period. And I want people to remember that we've called it out separately on the financials. Sequentially, our operating expenses excluding surcharges reduced despite an increase in spend for AI-related activities and higher legal and other costs. On the CapEx front, while we saw a sequential decline in |
7,003 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | in spend for AI-related activities and higher legal and other costs. On the CapEx front, while we saw a sequential decline in Q2, we still expect the year to be over $10 billion in CapEx as we increase our spend to bring a 50k GPU cluster online. This new cluster will immensely increase our capabilities to scale FSD and other AI initiatives. We reverted to positive free cash flow of $1.3 billion in Q2. This was despite restructuring payments being made in the quarter and we ended the quarter with over $30 billion of cash and investments. Once again, we've begun the journey towards the next phase for the company with the building blocks being placed. It will take some time, but will be a rewarding experience for everyone involved. Once again, I would like to thank the entire Tesla team for their efforts. |
7,004 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | A - Travis Axelrod: Great. Thank you very much, Vaibhav. Now let's go to investor questions. The first question is, what is the status on the Roadster?
Elon Musk: With respect to Roadster, we've completed most of the engineering. And I think there's still some upgrades we want to make to it, but we expect to be in production with Roadster next year. It will be something special, like the whole thing [Indiscernible].
Travis Axelrod: Fantastic. The next question is about timing of Robotaxi event, which we've already covered. So we'll go to the next question, when do you expect the first Robotaxi ride?
Elon Musk: I guess that, that's really just a question of when can we expect the first -- or when can we do unsupervised full self-driving. It's difficult, obviously, my predictions on this have been overly optimistic in the past. So I mean, based on the current trend, it seems as though we should get miles between interventions to be high enough that -- to be far enough in excess of humans that you could do unsupervised possibly by the end of this year. I would be shocked if we cannot do it next year. So next year seems highly probable to me based on [quite simply] (ph) plus the points of the curve of miles between intervention. That trend exceeds humans for sure next year, so yes.
Travis Axelrod: Thank you very much. Our third question is, the Cybertruck is an iconic product that wows everyone who sees it. Do you have plans to expand the cyber vehicle lineup to a cyber SUV or cyber van?
Elon Musk: I think we want to limit product announcements to when we have a special -- specific product announcement event, rather than earnings calls.
Travis Axelrod: Great, thank you. Our next question is, what is the current status of 4680 battery cell production and how is the ramp up progressing? |
7,005 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Yes, 4680 production ramped strongly in Q2, delivering 51% more cells than Q1 while reducing COGS significantly. We currently produce more than 1,400 Cybertrucks of 4680 cells per week, and we'll continue to ramp output as we drive cost down further towards the cost parity target we set for the end of the year. We've built our first validation Cybertruck with dry cathode process made on our mass production equipment, which is a huge technical milestone and we're super proud of that. We're on track for production launch with dry cathode in Q4, and this will enable cell cost to be significantly below available alternatives, which was the original goal of the 4680 program.
Travis Axelrod: Great. Thank you very much. The next question is any update on Dojo?
Elon Musk: Yes, so Dojo, I should preface this by saying I'm incredibly impressed by NVIDIA's execution and the capability of their hardware. And what we are seeing is that the demand for NVIDIA hardware is so high that it's often difficult to get the GPUs. And there just seems this, I guess I'm quite concerned about actually being able to get state-of-the-art NVIDIA GPUs when we want them. And I think this therefore requires that we put a lot more effort on Dojo in order to have -- in order to ensure that we've got the training capability that we need. So we are going to double down on Dojo, and we do see a path to being competitive with NVIDIA with Dojo. And I think we kind of have no choice because the demand for NVIDIA is so high and the -- it's obviously their obligation essentially to raise the price of GPUs to whatever the market will bear, which is very high. So, I think we've really got to make Dojo work and we will.
Travis Axelrod: Right. The next question is what type of accessories will be offered with Optimus? |
7,006 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Right. The next question is what type of accessories will be offered with Optimus?
Elon Musk: There's -- Optimus is intended to be a generalized humanoid robot with a lot of intelligence. So it's like saying what kind of accessories will be offered with a human. It's just really intended to be able to be backward compatible with human tasks. So it would use any accessories that a human would use. Yes.
Travis Axelrod: Thank you. The next question is, do you feel you're cheating people out of the joys of owning a Tesla by not advertising?
Elon Musk: We are doing some advertising, so, want to say something?
Vaibhav Taneja: Yes, I would say something. Our fundamental belief is that we need to be providing the best products at a reasonable price to the consumers. Just to give you a fact, in U.S. alone in Q2, over two-thirds of our sales were to -- deliveries were to people who had never owned a Tesla before and which is encouraging. We've spent money on advertising and other awareness programs and we have adjusted our strategy. We're not saying no to advertising, but this is a dynamic play and we know that we have not exhausted all our options and therefore plan to keep adjusting, but in the latter half of this year as well.
Travis Axelrod: Great. Thank you very much. The next question is on energy growth, which we already covered in opening remarks, so we'll move on to the next one. What is the updated timeline for Giga Mexico and what will be the primary vehicles produced initially? |
7,007 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Well, we currently are paused on Giga Mexico. I think we need to see just where things stand after the election. Trump has said that he will put heavy tariffs on vehicles produced in Mexico. So it doesn't make sense to invest a lot in Mexico if that is going to be the case. So we kind of need to see where the things play out politically. However, we are increasing capacity at our existing factories quite significantly. And I should say that the Cybertaxi or Robotaxi will be produced here at our headquarters at Giga Texas.
Travis Axelrod: All right. Thank you.
Elon Musk: And as well Optimus towards the end of next year for Optimus production Version 2, the high volume version of Optimus will also be produced here in Texas.
Travis Axelrod: Great. Thank you. Just a couple more. Is Tesla still in talks with an OEM to license FSD?
Elon Musk: There are a few major OEMs that have expressed interest in licensing Tesla full self-driving. And I suspect there will be more over time. But we can't comment on the details of those discussions.
Travis Axelrod: All right. Thank you. And the last one, any updates on investing in xAI and integrating Grok into Tesla software?
Elon Musk: I should say Tesla is learning quite a bit from xAI. It's been actually helpful in advancing full self-driving and in building up the new Tesla data center. With -- regarding investing in xAI, I think, we need to have a shareholder approval of any such investment. But I'm certainly supportive of that if shareholders are, the group -- probably, I think we need a vote on that. And I think there are opportunities to integrate Grok into Tesla's software, yes.
Travis Axelrod: All right. Thanks very much. And now we will move on to analyst questions. The first question comes from Will Stein from Truist. Will, please go ahead and unmute yourself. |
7,008 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Will Stein: Great. Thanks so much for taking my question. And this relates a little bit to the last one that was asked. Elon, I share your strong enthusiasm about AI and I recognize Tesla's opportunity to do some great things with the technology. But there are some concerns I have about Tesla's commercialization and that's what I'd like to ask about specifically. There were some news stories through the quarter that indicated that you redirected some AI compute systems that were destined for Tesla instead to xAI or perhaps it was to X, I'm not sure. And similarly, a few quarters ago, if you recall, I asked about your ability to hire engineers in this area, and you noted that there was a great desire for some of these engineers to work on projects that you were involved with, but some of them weren't at Tesla, they were instead at xAI or perhaps even X again. So the question is, when it comes to your capital investments, your AI R&D, your AI engineers, how do you make allocation decisions among these various ventures and how do you make Tesla owners comfortable that you're doing it in a way that really benefits them? Thank you. |
7,009 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes, I mean, I think you're referring to a very -- like an old article, regarding GPUs. I think that's like 6 or 7 months old. At Tesla, we had no place to try them on, so it would've been a waste of Tesla capital because we would just have to order H100 and have no place to try them on. So it was just -- there was -- this wasn't a, let's pick xAI of Tesla. There's -- there was no -- the Tesla data centers were full. There was no place to actually put them. The -- we've been working 24/7 to complete the South extension on the Tesla Giga factory in Texas. That South extension is what will house 50,000 H100s and we're beginning to move the H100 server racks into place there. But we really needed -- we needed that to complete physically. You can't just order compute -- order GPUs and turn them on, you need a data center, it's not possible. So I want to be clear, that was in Tesla's interest, not contrary to Tesla's interest. Does Tesla no good to have GPUs that it can't turn on. That South extension is able to take GPUs, which is really just this week. We are moving the GPUs in there and we'll bring them online. With regard to xAI, there are a few that only want to work on AGI. So what I was finding was that when trying to recruit people to Tesla, they were only interested in working on AGI and not on Tesla's specific problems and they want to start -- do a start-up. So it was a case of either they go to a start-up or -- and I am involved or they do a start-up and I am not involved. Those are the two choices. This wasn't they would come to Tesla. They were not going to come to Tesla under any circumstances. So, yes. |
7,010 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Yes, I mean, I would even add that AI is a broad spectrum and there are a lot of things which we are focused on full time driving as Tesla and also Optimus, but there's the other spectrum of AI which we're not working on, and that's the kind of work which other companies are trying to do in this case, xAI. So you have to keep that in mind that it's a broad spectrum. It's not just one specific thing.
Elon Musk: Yes. And once again, I want to just repeat myself here. I tried to recruit them to Tesla, including to say like, you can work on AGI, I if you want and they refused. Only then was xAI created.
Will Stein: I really appreciate that clarification. If I can ask one follow-up, it relates to the new vehicles that you're planning to introduce next year. I understand this is not the venue for product announcements, but when we think about the focus, I've heard on the one hand that the focus is on cost reduction. On the other hand, you also said that the Roadster would come out. Should we expect other maybe more limited variants like, similar to the cars that you make today, but with some changes or improvements or different, some other variability in the form factors. It should -- we expect that to be a significant part of the strategy in the next year or two?
Elon Musk: I don't want to get into details of product announcements. And we have to be careful of the Osborne effect here. So, if you start announcing some great thing, it affects our near-term sales. We're going to make great products in future just like we have in the past, end of story.
Travis Axelrod: Right. The next question comes from Ben Kallo from Baird. Ben, please go ahead and unmute yourself. |
7,011 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Right. The next question comes from Ben Kallo from Baird. Ben, please go ahead and unmute yourself.
Ben Kallo: Hi. Thanks for taking my question. When we think about revenue contribution and with energy growing so quickly and Optimus on the come, how do we think about the overall segments longer term? And then do you think that auto revenue will fall below 50% of your overall revenue? And then my follow-up is just on the last call you talked about, distributed compute on your new hardware. Could you just update us and talk a little bit more about that, the timeline for it and how you would reward customers for letting you use their compute power and their cars? Thanks. |
7,012 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes, I mean, as I've said a few times, I think the long-term value of Optimus will exceed that of everything else that Tesla combined. So, it's simply -- just simply consider the usefulness utility of a humanoid robot that can do pretty much anything you ask of it. I think everyone on earth is going to want one. There's 8 billion people on earth, so it's 8 billion right there. Then you've got, all of the industrial uses, which is probably at least as much, if not way more. So I suspect that the long-term demand for general purpose humanoid robots is in excess of 20 billion units. And Tesla is -- that has the most advanced humanoid robot in the world, and is also very good at manufacturing, which these other companies are not. And we've got a lot of experience -- with the most experienced with the world leaders in real world AI. So we have all of the ingredients. I think we are unique in having all of the ingredients necessary for large scale, high utility, generalized humanoid robots. That's why my rough estimate long-term is in accordance with the ARK [ph] Invest analysis of market cap on the order of $5 trillion for -- maybe more for autonomous transport, and it's several times that number for general purpose humanoid robots. I mean, at that point, I'm not sure what money even means, but in the benign AI scenario, we are headed for an age of abundance where there is no shortage of goods and services. Anyone can have pretty much anything they want. It's a wild -- very wild future we're heading for.
Ben Kallo: On the distributed compute? |
7,013 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Ben Kallo: On the distributed compute?
Elon Musk: Yes, distributed compute, that seems like a pretty obvious thing to do. I think the -- where this distributed compute becomes interesting is with our next generation Tesla AI truck, which is hardware viable or what we're calling AI5, which is -- from the standpoint of inference capability comparable toB200 -- and a bit of B200. And we are aiming to have that in production at the end of next year and scale production in '26. So it just seemed like if you've got -- even if you've got autonomous vehicles that are operating for 50 or 60 hours a week, there's a 168 hours in a week. So you have somewhere above I think a 100 [indiscernible] net computing. I think we need a better word than GPU because GPU means graph express in unit. So there's a 100 hours plus per week of AI compute, AI advanced compute from the fleet, from the vehicles and probably some percentage from the humanoid robots that it would make sense to do distributed inference. And if you're -- if there's a fleet of at some point a 100 million vehicles with AI5 and beyond, because you have AI 6 and 7 and whatnot, and there may be billions of humanoid robots that is just a staggering amount of inference compute or that could be used for general purposes at computing. It doesn't have to be used for, the humanoid robot or for the car. So I think, that's just -- that -- that's a pretty obvious thing to say, like, well, it's more useful than having to do nothing.
Travis Axelrod: All right. Thank you. The next question comes from Alex Potter from Piper Alex. Alex, please go ahead and unmute yourself. |
7,014 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Alex Potter: Perfect. Thanks. I wanted to ask a question on FSD licensing. You mentioned that in passing previously, was just wondering if you can elaborate maybe on the mechanics of how that would work. I guess presumably this would not be some sort of simple plug and play proposition that presumably an OEM would need, I don't know, several years to develop its own vehicle platform that's based on FSD. I imagine they would need to adopt Tesla's electrical architecture, compute, sensor stack. So I, correct me if I'm sort of misunderstanding this, but if you had a cooperative agreement of some kind with another OEM, then presumably it would take you several years before you'd be able to recognize licensing revenue from that agreement. Is that the right way to think about that?
Elon Musk: Yes. The OEMs not real fast. There's not really a sensor suite, it's just cameras. But they would have to integrate our AI computer and have cameras with a 360 degree view. And at least the gateway, like the what talks to the internet, and communicates with the Tesla system, what that you need kind of a gateway computer too. So it's really gateway computer with the cellular and Wi-Fi connectivity, the Tesla AI computer, and seven cameras, or not cameras, again, a 360 degree view. But this will -- given the speed at which, the auto industry moves, it would be several years before you would see this in volume.
Alex Potter: Okay, good. That's more or less what I expected. So then the follow-up here is, if you did sign an FSD licensing agreement with another automaker, when do you think you would disclose that? Would you do it right when you signed the agreement or only after that multiple years has passed and the vehicle is ready to be rolled out? think it depends on the OEM. I guess we'd be happy either way. Yes, it depends on, what kind of arrangement we enter into. A lot of those things are, we are not resolved yet, so we'll make that determination as and when we get to that point. |
7,015 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: And the kind of deals that are obviously relevant are only if, some OEM is willing to do this in a million cars a year or something significant. It's not -- if it's like 10,000 or a 100,000 cars a year. We can just make that ourselves.
Travis Axelrod: All right, thank you. The next question comes from Dan Levy from Barclays. Dan, please go ahead and unmute yourself.
Dan Levy: Hi, good evening. Thanks for taking the questions. First, wanted to start with a question on Shanghai. You've leveraged Shanghai as an export center really due its low cost, and that makes sense. But maybe you can just give us a sense of, of how the strategy changes, if at all, given, the implementation of tariffs in Europe. Also to what extent, your import of batteries from China into the U.S., how that might change given the tariffs. Thank you. |
7,016 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. I think I covered some part of it in my opening remarks, but just to give you a little bit more, just on the tariff side, the European authorities did sample certain other OEMs in the first round to establish the tariffs for cars being imported from China into Europe. While we were not picked up in our individual examination in the first round, they did pick us up in the second round. They visited our factory. They -- we worked with them, provided them all the information. As a result, we were adjusting our import strategy out of China into Europe. But -- and one other thing to note is in Q2 itself, we started building right hand from model wise out of Berlin and we also delivered it in U.K. And we're adjusting as needed, but we will keep adjust. We're still importing Model 3s into Europe, out of Shanghai. And we are still evaluating what is the best alternate manage all this just on the examination by the European authorities. Like I said, we cooperated with them. Well, we are confident that they, we should get a better rate than what they have imposed for now. But this is literally evolving and we are adjusting as fast as we can with this. It is -- I would also add that, because of this, you've seen the impact that Berlin is doing more imports into places like Taiwan as well as, U.K I just mentioned. So it will keep changing and we will keep adapting as we go about it.
Dan Levy: Great. Thanks. Yes, thank you. As a follow-up, wanted to ask about the Robotaxi strategy and specifically the shareholder deck here notes that the release is going to be -- one of the gating factors is regulatory approval. So maybe you could help us understand which regulations specifically are the ones that we should be looking for? Is it FMVSS, that's standard? And then to what extent does the strategy shift? You've done with FSD more of a nationwide, no boundary approach. Is the Robotaxi approach one that's more geofenced, so to speak, and is more driven by a state by state approach? |
7,017 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I mean, our solution is a generalized solution like what everybody else has. They, if you see like Waymo has one of it, they have a very localized solution that requires high density mapping. It's not -- it's quite fragile. So, their ability to expand rapidly is limited. Our solution is a general solution that works anywhere. It would even work on a different earth. So if you're rendered a new Earth, it would work on a new earth. So it's -- there's this capability I think in our experience, once we demonstrate that something is safe enough or significantly safer than human. We are fine that regulators are supportive of deploying deployment of that capability. It's difficult to argue with if you -- if you've got a large number of -- yes, if you've got billions of miles that show that in the future unsupervised FSD is safer than human. What regulator could really stand in the way of that? They would -- they're morally obligated to approve. So I don't think regulatory approval will be a limiting factor. I should also say that the self-driving capabilities of this are deployed outside of North America are far behind that in, in North America. So with the -- with Version 12.5, and maybe a 12.6, but pretty soon we will ask for regular regulatory approval of the Tesla supervised FSD in Europe, China, and other countries. And I, I think we're likely to receive that before the end of the year, which will be a helpful demand driver in those regions obviously.
Travis Axelrod: Thank you. Just to …
Elon Musk: Go ahead, Travis. |
7,018 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Thank you. Just to …
Elon Musk: Go ahead, Travis.
Travis Axelrod: In terms of like, as Elon said, in terms of regulatory approval, the vehicles are governed by FMVSS in U.S., which is the same across all 50 states. The road rules are the same across all 50 states. So creating a generalized solution gives us the best opportunity to deploy in all 50 states, reasonably. Of course there are state and even local and municipal level regulations that may apply to, being a transportation company or deploying taxes. But as far as getting the vehicle on the road, that's all federal and that's very much in line with what you was just suggesting about the data and the vehicle itself.
Vaibhav Taneja: And to add to the technology point, the end-to-end network basically makes no assumption about the location. Like you could add data from different countries and it just like perform equally well there, just like almost like close to zero US specific, um, code in there. It's all just the data that comes from the U.S
Elon Musk: Yes. To, to that end of the show, it's like, we can go as humans to other countries and drive with some reasonable amount of assessment in those countries. And that's how you design the FSC software. Yes, exactly.
Travis Axelrod: Great. Thanks guys. The next question comes from George from Canaccord. George, please go ahead and unmute yourself. |
7,019 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | George Gianarikas: Hi, everyone. Thank you for taking my questions. Maybe just to expand on the regulatory question for a second. And I could be comparing apples and oranges, but GM canceled their pedal less, wheel less vehicle. And according to the company this morning, their decision was driven by uncertainty about the regulatory environment. And from what we understand, and again, maybe I'm wrong here, but the Robotaxi that has been shown at least in images of the public is also pedal less and wheel less. Is there a different regulatory concern just if you deploy a vehicle like that that doesn't have pedal -- pedals or a wheel, and that may not be different from just regular FSD on a traditional Tesla vehicle. Thank you.
Elon Musk: Well, obviously the real reason that they cancel it is because GM can't make it work, not because the regulators, they're blaming regulators. That's misleading of them to do so, because Waymo is doing just fine in those markets. So it's just that their technology is not far.
George Gianarikas: Right. And maybe just as a follow-up, I think you mentioned, that FSD take rates were up materially after you reduced the price. Is there any way you can help us quantify what that means Exactly? Thank you. |
7,020 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Yes, we shared the [indiscernible] that there we've seen a meaningful increase. I don't want to get into specific because we started from a low base and -- but we are seeing encouraging results. And the key thing here is, like Elon said, you need to experience it because words can't describe it till the time we actually use it. And that's why we are trying to make sure that every time a car is getting delivered, people are being showed how this thing is working because when you see it working, you realize how great it is. I mean, just to give you one example, so again, there's a bias example, but I have a more than 20 mile commute into the factory almost every day. I have zero interventions on the latest stack, and the card just literally drives me over. And especially with the latest version wherein, we are also tracking your eye movement, the steering wheel lag is almost not there as long as you're not wearing sunglasses.
Elon Musk: Well, we are fixing the sunglasses thing. It's coming soon. So you will be able to drive -- you'll be able to have sunglasses on and have the car drive.
George Gianarikas: Yes.
Elon Musk: So -- but there's number of times I've talked with smart people who like live in New York or maybe downtown Boston and don't ever drive and then ask me about FSD, I'm like, you can just get a car and try it. And if you're not doing that, you have no idea what's going on.
Travis Axelrod: Thank you. The next question comes from Pierre from New Street. Pierre, please unmute yourself. |
7,021 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Thank you. The next question comes from Pierre from New Street. Pierre, please unmute yourself.
Ferragu Pierre: Hey, guys. Thank you for taking my question. So it's on Robotaxi again, and I completely get it that with a universal solution, we will get like regulatory approval, we'll get there eventually clicking up miles and compute, et cetera. And my question is more, how you think about deployments, because I'm still like, I'm thinking once you have a car that can drive everywhere, that can replace me, it can replace a taxi, but then to do the right hailing service, you need a certain scale. And that means a lot of cars on the road and so you need an infrastructure to just maintain the cars, take care of them, et cetera. And so my question is, are you already working on that? Do you have already an idea of what, like your plan to deploy looks like? And is that like a test Tesla only plan or are you looking at partners, local partners, global partners to do that? And I'll have a quick follow-up. |
7,022 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. This would just be the Tesla network. You just literally open the Tesla app and summon a car and resend a car to pick you up and take you somewhere. And you can -- our -- we'll have a fleet that's I don't know, on order of 7 million dedicated global autonomy soon. In the years come it'll be over 10 million, then over 20 million. This is immense scale. And the car is able to operate 24/7, unlike the human driver. So, the capability to -- like, if there's this basically instant scale with a software update. And now this is for a customer on fleet. So you can think of that as being a bit like Airbnb, like you can choose to allow your car to be used by the fleet, or cancel that and bring it back. It can be used by the fleet all the time. It can be used by the fleet some of the time, and then Tesla would take -- would share on the revenue with the customer. But you can think of the giant fleet of Tesla vehicles as like a giant sort of Airbnb equivalent fleet, Airbnb on wheels. The -- I mean, then in addition we would make some number of cars for Tesla that would just be owned by Tesla and be added to the fleet. I guess that would be a bit more like Uber. But this would all be a Tesla network. And there's an important clause we've put in, in every Tesla purchase, which is that the Tesla vehicles can only be used in the Tesla fleet. They cannot be used by a third-party for autonomy.
Ferragu Pierre: Okay. And do you think that scale is like progressively so you can start in a city with just a handful of cars and you grow the number of cars over time? Or do you think there is like a critical mass you need to get to, to be able to offer like a service that is of competitive quality compared to what like the -- like Uber would be typically delivering already? |
7,023 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I guess I'm not -- maybe I'm not conveying this correctly. The entire Tesla fleet basically becomes active. This is obviously maybe there's some number of people who don't want their car to own money, but I think most people will. It's instant scale.
Travis Axelrod: Thank you. Our next question comes from Colin from Oppenheimer. Colin, please unmute yourself.
Colin Rusch: Sorry about that guys. I've got two questions around energy storage. With the tight supply and the stationary storage, can you talk about your pricing strategy and how you're thinking about saturation and given geographies given that some of these larger systems are starting to shift wholesale power markets in a pretty meaningful way quickly?
Vaibhav Taneja: So, I mean, we are working with a large set of players in the market and our pipeline is actually pretty long. And there's actually very -- there's actually long end in terms of where you enter into a contract where delivery started -- starts happening. And so far we have good pricing leverage. And now Mike, chime in on this too.
Unidentified Company Representative: Yes, I mean there's a lot of competition from Chinese OEMs just like there is in the vehicle space. So we're in close contact with our customers and making sure that we're remaining competitive in where they're needing to be competitive to, to secure contracts to sell power and energy in the markets. We had a really strong contracting quarter and continue to build our backlog for 2025 and 2026. So we feel pretty good about where we are in the market. We realize that competition is strong, but we have a pretty strong value proposition with offering a fully integrated product with our own power electronics and site level controls. So … |
7,024 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Yes, and again, the aspect which people miss do not fully understand is that there's also a whole software stack, which comes with from Megapack, right? And that is a unique proposition which we -- which is only available to us, and we are using it with other stuff too, but that gives us a much more of an edge as compared to the competition.
Elon Musk: Yes, we find customers that they can sort of put together a hodgepodge solution. And so, and then sometimes they'll pick that solution, and then that doesn't work. And then they come back to us.
Unidentified Company Representative: Yes, and we're not really seeing saturation for like, on a global scale. There's little pockets of saturation in different markets, but we're more seeing that there's markets opening up given demand on the grid just continues to increase more than anyone expects. So that just opens up markets, really across the world in different pockets.
Vaibhav Taneja: Yes, I mean just even on the AI computer side, right? These GPUs are really powerful already and the amount of new pipeline, which we're getting for people for data center backup and things like that is increasing at a pretty large scale.
Colin Rusch: Yes. Thanks. And then the follow-up here is 4680 process technology and the role to role process. There's some news around your equipment suppliers. Can you talk about how far along you are in, in potentially qualifying an incremental supplier around some of that, those critical process technology steps?
Lars Moravy: Yes, I can talk about that. As you're probably referring to the lawsuit that we have with one of our suppliers, look, I don't think this is going to affect our ability to roll out 4680. We have very strong IP position in the technology and the majority of the equipment that we use is in-house designed and some of it's in-house build. And so we can take our IP stack and have someone else build it if we need to. So it's, that's not really a concern right now. |
7,025 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. I, I think people don't understand just how much demand there will be for grid storage. They really just like the [indiscernible] I think are underestimating this demand by probably orders magnitude. So that the actual energy, total energy output of, say the U.S grid is if the power plants can operate a steady state is at least two to three times, the amount of energy it currently produces, because there are a huge gap. There's a huge difference in the -- from peak to trough in terms of energy of power generation. So in order for a grid to not have blackouts, it must be able to support the load at the worst minute of the worst day of the year, the coldest or hottest day, which means that for the rest of the time, the rest of the year, it's got massive excess power generation capability, but it has no way to store that energy. Once you add battery packs, you can now run the power plants at steady state. Steady state means that basically any given grid anywhere in the world can produce in terms of cumulative energy in the course of the year, at least twice what it is currently producing in some cases, maybe three times.
Travis Axelrod: All right. Thank you, Elon. The next question comes from Colin Langan from Wells Fargo. Colin, please unmute yourself.
Colin Langan: Oh, great. Thanks for taking my questions. Do you hear me?
Travis Axelrod: Yes.
Colin Langan: Yes. Sorry. I guess when we are going to ask, if Trump wins, there's a higher chance that IRA could get cut. I think Elon, you had commented online that Tesla doesn't survive on EV subsidies. But when Tesla lose a lot of support if IRA goes away? I think model Y3 and Y get IRA help for customers, and I think your batteries get production tax credits. So, just one, can you clarify if the end, if IRA ends, would it be a negative for your profitability in the near-term? Why might it not be a negative? And then, any framing of the current support you get, IRA-related? |
7,026 | TSLA | 2 | 2,024 | 2024-07-24 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I guess that there would be like some impact, but I think it would be devastating for our competitors. But -- and it would hurt Tesla slightly. But long-term probably actually helps Tesla would be my guess. Yes -- but I've said this before on earnings calls, it -- the value of Tesla overwhelmingly is autonomy. These other things are in the noise relative to autonomy. So I recommend anyone who doesn't believe that Tesla will solve vehicle autonomy should not hold Tesla stock. They should sell their Tesla stock. You should believe Tesla will solve autonomy, you should buy Tesla stock. And all these other questions are in the noise.
Vaibhav Taneja: Yes, I mean, I'll add this just to clarify a few things that -- at the end of the day, when we are looking at our business, we've always been looking at it whether or not IRA is there and we want our business to grow healthy without having any subsidies coming in, whichever way you look at it. And that's the way we have always modeled everything. And that is the way internally also even when we are looking at battery costs, yes, I --, there are manufacturing credits which we get, but we always drive ourselves to say, okay, what if there is no higher benefit and how do we operate in that kind of an environment? And like Elon said, we definitely have a big advantage as compared to a competition on that front. We've delivered it and you can see it in the numbers over the years. Like, so there is you cannot ignore the fundamental size of the business. And then on top of it, once you add autonomy to it, like even said, it becomes meaningless to you think about the short-term.
Travis Axelrod: Okay. I think that's unfortunately all the time we have for today. We appreciate all of your questions. We look forward to talking to you next quarter. Thank you very much and goodbye.
Elon Musk: That's excellent. |
7,027 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Martin Viecha: Tesla's First Quarter 2024 Q&A Webcast. My name is Martin Viecha, VP of Investor Relations, and I'm joined today by Elon Musk, Vaibhav Taneja, and a number of other executives. Our Q1 results were announced at about 3.00 p.m. Central Time in the Update Deck we published at the same link as this webcast. During this call, we will discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events and results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC. During the question-and-answer portion of today's call, please limit yourself to one question and one follow-up. Please use the raise hand button to join the question queue. But before we jump into Q&A, Elon has some opening remarks. Elon? |
7,028 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Thanks, Martin. So to recap in Q1 we navigated several unforeseen challenges as well as the ramp of the updated Model 3 in Fremont. There was, as we all have seen, the EV adoption rate globally is under pressure and a lot of other auto manufacturers are pulling back on EVs and pursuing plug-in hybrids instead. We believe this is not the right strategy and electric vehicles will ultimately dominate the market. Despite these challenges, the Tesla team did a great job executing in a tough environment and energy storage deployments, the Megapack in particular, reached an all time high in Q1, leading to record profitability for the energy business, and that looks likely to continue to increase in the quarters and years ahead. It will increase. We actually know that it will, so significantly faster than the car business as we expected. We also continue to expand our AI training capacity in Q1, more than doubling our training compute sequentially. In terms of the new product roadmap, there has been a lot of talk about our upcoming vehicle line in the next – in the past several weeks. We've updated our future vehicle lineup to accelerate the launch of new models ahead, previously mentioned startup production in the second half of 2025, so we expect it to be more like the early 2025, if not late this year. These new vehicles, including more affordable models, will use aspects of the next generation platform as well as aspects of our current platforms, and will be able to produce on the same manufacturing lines as our current vehicle lineup. So it's not contingent on any new factory or massive new production line. It'll be made on our current production lines much more efficiently. And we think this should allow us to get to over 3 million vehicles of capacity when realized to the full extent. Regarding FSD Version 12, which is the pure AI-based self-driving, if you haven't experienced this, I strongly urge you to try it out. It's profound and the rate of improvement is rapid so – and we've now turned that on |
7,029 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | this, I strongly urge you to try it out. It's profound and the rate of improvement is rapid so – and we've now turned that on for all cars with the cameras and inference computer and everything from Hardware 3 on in North America. And so it's been pushed out to, I think, around 1.8 million vehicles and we're seeing about half of people use it so far and that percentage is increasing with each passing week. So we now have over 300 billion miles that have been driven with FSD V12. Since the launch of full self-driving, supervised full self-driving, it's become very clear that the vision-based approach with end to end neural networks is the right solution for scalable autonomy. It's really how humans drive. Our entire road network is designed for biological neural nets and eyes. So naturally cameras and digital neural nets are the solution to our current road system. To make it more accessible, we've reduced the subscription price to $99 a month, so it's easy to try out. And as we've announced, we'll be showcasing our purpose-built robotaxi, or Cybercab, in August. Yes. Regarding AI compute, over the past few months, we've been actively working on expanding Tesla's core AI infrastructure. For a while there, we were training constrained in our progress. We are, at this point, no longer training constrained and so we're making rapid progress. We've installed and commissioned, meaning they're actually working 35,000 H100 computers or GPUs, GPU is wrong word, they need a new word. I always feel like a wince when I say GPU because it's not – GPU stands – G stands for graphics, and it doesn't do graphics. But anyway roughly 35,000 H100s are active, and we expect that to be probably 85,000 or thereabouts by the end of this year and training, just for training. We are making sure that we're being as efficient as possible in our training. It's not just about the number of H100s, but how efficiently they're used. So in conclusion, we're super excited about our autonomy road map. I think it should be obvious to anyone who's |
7,030 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | they're used. So in conclusion, we're super excited about our autonomy road map. I think it should be obvious to anyone who's driving Version 12 and it tells that that it is only a matter of time before we exceed the reliability of humans and not much time with that. And we're really headed for an electric vehicle, an autonomous future. And I'll go back to something I said several years ago that in the future, gasoline cars that are not autonomous will be like riding a horse and using a flip phone. And that will become very obvious in hindsight. We continue to make the necessary investments that will drive growth and profits for Tesla in the future, and I wanted to thank the Tesla team for incredible execution during this period and look forward to everything that we have planned ahead. Thanks. |
7,031 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Martin Viecha: Thank you very much, and Vaibhav has some comments as well. |
7,032 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Thanks. It's important to acknowledge what Elon said, from our auto business perspective. We did see a seasonal decline in revenues quarter-over-quarter and those were primarily because of seasonality, uncertain macroeconomic environment and the other reasons, which Elon had mentioned earlier. Auto margins declined from 18.9% to 18.5%. Excluding the impact of Cybertruck, the impact of pricing actions was largely offset by reductions in per unit costs and the recognition of revenue from Autopark feature for certain vehicles in the U.S. that previously did not have that functionality. Additionally, while we did experience higher cost due to the ramp of Model 3 in Fremont and disruptions in Berlin, these costs were largely offset by cost reduction initiatives. In fact, if we exclude Cybertruck and Fremont Model 3 ramp costs, the revenue from Autopark, auto margins improved slightly. Currently normalized Model Y cost per vehicle in Austin and Berlin are already very close to that of Fremont. Our ability to reduce costs without sacrificing on quality was due to the amazing efforts of the team, in executing Tesla's relentless pursuit of efficiency across the business. We've also witnessed that as other OEMs are pulling back on their investments in EV, there is increasing appetite for credits, and that means a steady stream of revenue for us. Obviously, seeing others pull back from EV is not the future we want. We would prefer it the whole industry went all in. On the demand front, we've undertaken a variety of initiatives, including lowering the price of both the purchase and subscription options for FSD launching extremely attractive leasing specials for the Model 3 in the U.S. for $299 a month and offering attractive financing options in certain markets. We believe that our awareness activities, paired with attractive financing, will go a long way in expanding our reach and driving demand for our products. Our Energy business continues to make meaningful progress with margins reaching a record of |
7,033 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | driving demand for our products. Our Energy business continues to make meaningful progress with margins reaching a record of 24.6%. We expect the energy storage deployments for 2024 to grow at least 75% higher from 2023. And accordingly, this business will begin contributing significantly to our overall profitability. Note that there is a bit of lumpiness in our storage deployments due to a variety of factors that are outside of our control, so deployments may fluctuate quarter-over-quarter. On the operating expense front, we saw a sequential increase from our AI initiatives, continued investment in future projects, marketing and other activities. We had negative free cash flow of $2.5 billion in the first quarter. The primary driver of this was an increase in inventory from a mismatch between builds and deliveries as discussed before, and our elevated spend on CapEx across various initiatives, including AI compute. We expect the inventory build to reverse in the second quarter and free cash flow to return to positive again. As we prepare the company for the next phase of growth, we had to make the hard but necessary decision to reduce our head count by over 10%. The savings generated are expected to be well in excess of $1 billion on an annual run rate basis. We are also getting hyper focused on CapEx efficiency and utilizing our installed capacity in a more efficient manner. The savings from these initiatives, including our cost reductions will help improve our overall profitability and ultimately enable us to increase the scale of our investments in AI. In conclusion, the future is extremely bright and the journey to get there while challenging will be extremely rewarding. Once again, I would like to thank the whole Tesla team for delivering great results. And we can open it up to Q&A. |
7,034 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | A - Martin Viecha: Okay. Let's start with investor Q&A. The first question is, what is the status of 4680. What is the current output? Lars?
Lars Moravy : Sure. 4680 production increased about 18% to 20% from Q4 reaching greater than 1K a week for Cybertruck, which is about 7 gigawatt hours per year as we posted on X. We expect to stay ahead of the Cybertruck ramp with the cell production throughout Q2 as we ramp the third of four lines in Phase 1, while maintaining multiple weeks of cell inventory to make sure we're ahead of the ramp. Because we're ramping, COGS continues to drop rapidly week-over-week driven by yield improvements throughout the lines and production volume increases. So our goal, and we expect to do this is to beat supplier cost of nickel-based cells by the end of the year.
Martin Viecha: Thank you. The second question is on Optimus. So what is the current status of Optimus? Are they currently performing any factory tasks? When do you expect to start mass production? |
7,035 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: We are able to do simple factory tasks or at least, I should say, factory tasks in the lab. In terms of – we do think we will have Optimus in limited production in the natural factory itself, doing useful tasks before the end of this year. And then I think we may be able to sell it externally by the end of next year. These are just guesses. As I've said before, I think Optimus will be more valuable than everything else combined. Because if you've got a sentient humanoid robots that is able to navigate reality and do tasks at request, there is no meaningful limit to the size of the economy. So that's what is going to happen. And I think Tesla is best positioned of any humanoid robot maker to be able to reach volume production with efficient inference on the robot itself. I mean this perhaps is a point that is worth emphasizing Tesla's AI inference efficiency is vastly better than any other company. There is no company even close to the inference efficiency of Tesla. We've had to do that because we were constrained by the inference hardware in the car, we didn't have a choice. But that will pay dividends in many ways.
Martin Viecha: Thank you. The third question is, what is the current assessment of the pathway towards regulatory approval for unsupervised FSD in the U.S. And how should we think about the appropriate safety threshold compared to human drivers?
Elon Musk: Sure.
Lars Moravy: I can start. There are a handful of states that already have adopted autonomous vehicle laws. These states are paving the way for operations, while the data for such operations guides a broader adoption of driver-less vehicles. I think Ashok can talk a little bit about our safety methodology, but we expect that these states and the work ongoing as well as the data that we're providing will pave a way for a broad-based regulatory approval in the U.S. at least and then in other countries as well? |
7,036 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: Yes. It's actually been pretty helpful that other autonomous car companies have been cutting a path through the regulatory jungle, which is absurd. That's actually quite helpful. And they have obviously been operating in San Francisco for a while. I think they got approval for City of LA. So these approvals are happening rapidly. I think if you've got at scale, a statistically significant amount of data that shows conclusively that the autonomous car has, let's say, half the accident rate of a human-driven car, I think, that's difficult to ignore because at that point, stopping autonomy means killing people. So I actually do not think that there will be significant regulatory barriers provided there was conclusive data that the autonomous car is safer than a human-driven car. And in my view, this will be much like elevators. Elevators used to be operated by a guy with relay switch. But sometimes that guy would get tired or drunk or just make a mistake, and shatter somebody in half between floors. So we just get an elevator and press button, we don't think about it. In fact, it's kind of weird if somebody is standing there with a relay switch. And that will be how cars work. You just summon the car using your phone, you get in, it takes you to a destination, you get out.
Vaibhav Taneja: You don't even think about it? |
7,037 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: You don't even think about it. Just like an elevator, it takes you to your floor. That's it. Don't think about how the elevator is working or anything like that. And something I should clarify is that Tesla will be operating the fleet. So you can think of like how Tesla, think of it’s like some combination of Airbnb and Uber, meaning that there will be some number of cars that Tesla owns itself and operates in the fleet. There will be some number of cars and then there'll be a bunch of cars where they're owned by the end user. That end user can add or subtract their car to the fleet whenever they want, and they can decide if they want to only let the car be used by friends and family or only by 5-star users or by anyone at any time they could have the car come back to them and be exclusively theirs, like an Airbnb. You could rent out your guest room or not, any time you want. So as our fleet grows, we have 7 million cars going to – 9 million cars going to, eventually tens of millions of cars worldwide. With a constant feedback loop, every time something goes wrong, that gets added to the training data and you get this training flywheel happening in the same way that Google Search has the sort of flywheel, it's very difficult to compete with Google because people are constantly doing searches and clicking and Google is getting that feedback loop. It’s the same with Tesla. But at a scale that is maybe difficult to comprehend, but ultimately, it will be tens of millions. I think there's also some potential here for an AWS element down the road where if we've got very powerful inference because we've got a Hardware 3 in the cars, but now all cars are being made with Hardware 4. Hardware 5 is pretty much designed and should be in cars, hopefully towards the end of next year. And there's a potential to run – when the car is not moving to actually run distributed inference. So kind of like AWS, but distributed inference. Like it takes a lot of computers to train an AI model, but many orders of magnitude less |
7,038 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | like AWS, but distributed inference. Like it takes a lot of computers to train an AI model, but many orders of magnitude less compute to run it. So if you can imagine future, perhaps where there's a fleet of 100 million Teslas, and on average, they've got like maybe a kilowatt of inference compute. That's 100 gigawatts of inference compute distributed all around the world. It's pretty hard to put together 100 gigawatts of AI compute. And even in an autonomous future where the car is, perhaps, used instead of being used 10 hours a week, it is used 50 hours a week. That still leaves over 100 hours a week where the car inference computer could be doing something else. And it seems like it will be a waste not to use it. |
7,039 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Martin Viecha: Ashok, do you want to chime in on the air process and safety? |
7,040 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: Yes, we have multiple tiers of validating the safety in any given week, we train hundreds of neural networks that can produce different trajectories for how to drive the car, we replay them through the millions of clips that we have already collected from our users and our own QA. Those are like critical events, like someone jumping out in front or like other critical events that we have gathered database over many, many years, and we replay through all of them to make sure that we are net improving safety. And on top of it, we have simulation systems that also try to recreate this and test this in closed loop fashion. And some of this is validated, we give it to our own QA drivers. We have hundreds of them in different cities, in San Francisco, Los Angeles, Austin, New York, a lot of different locations. They are also driving this and collecting real-world miles, and we have an estimate of what are the critical events, are they a net improvement compared to the previous week’s builds. And once we have confidence that the build is a net improvement, then we start shipping to early users, like 2,000 employees initially that they would like it to build, they will give feedback on like if it's an improvement there or they're noting some new issues that we did not capture in our own QA process. And only after all of this is validated, then we go to external customers. And even when we go external, we have like live dashboards of monitoring every critical event that's happening in the fleet sorted by the criticality of it. So we are having a constant pulse on the build quality and the safety improvement along the way. And then any failures like Elon alluded to, we get the data back, add it to the training and that improves the model in the next cycle. So we have this like constant feedback loop of issues, fixes, evaluations and then rinse and repeat. And especially with the new V12 architecture, all of this is automatically improving without requiring much engineering interventions in the sense that |
7,041 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | new V12 architecture, all of this is automatically improving without requiring much engineering interventions in the sense that engineers don't have to be creative in like how they code the algorithms. It's mostly learning on its own based on data. So you see that, okay, every failure or like this is how a person shows, this is how you drive this intersection or something like that, they get the data back. We add it to the neural network, and it learns from that trained data automatically instead of some engineers saying that, oh, here, you must rotate the steering wheel by this much or something like that. There's no hard inference conditions, it's everything is neural network, it's very soft, it's probabilistic. So it will adapt its probability distribution based on the new data that it's getting. |
7,042 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. We do have some insight into how good the things will be in like, let's say, three or four months because we have advanced models that are far more capable than what is in the car, but have some issues with them that we need to fix. So they are like there'll be a step change improvement in the capabilities of the car, but it will have some quirks that are – that need to be addressed in order to release it. As Ashok was saying, we have to be very careful in what we release the fleet or to customers in general. So like – if we look at say 12.4 and 12.5, which are really could arguably even be Version 13, Version 14 because it's pretty close to a total retrain of the neural nets in each case are substantially different. So we have good insight into where the model is, how well the car will perform, in, say, three or four months. |
7,043 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: Yes. In terms of scaling laws, people in the AI community generally talk about model scaling laws where they increase the model size a lot and then their corresponding gains in performance, but we have also figured out scaling laws and other access in addition to the model side scaling, making also data scaling. You can increase the amount of data you use to train the neural network and that also gives similar gains and you can also scale up by training compute, you can train it for much longer or make more GPUs or more Dojo nodes and that also gives better performance, and you can also have architecture scaling where you count with better architectures that for the same amount of compute for produce better results. So a combination of model size scaling, data scaling, training compute scaling and the architecture scaling, we can basically extract like, okay, with the continue scaling based on this – at this ratio, we can sort of predict future performance. Obviously, it takes time to do the experiments because it takes a few weeks to train, it takes a few weeks to collect tens of millions of video clips and process all of them, but you can estimate what’s going to be the future progress based on the trends that we have seen in the past, and they’re generally held true based on past data.
Martin Viecha: Okay. Thank you very much. I’ll go to the next question, which is, can we get an official announcement of the time line for the $25,000 vehicle?
Lars Moravy: I think we – Elon mentioned it in the opening remarks. But as you mentioned, we’re updating our future vehicle lineup to accelerate the launch of our low-cost vehicles in a more CapEx efficient way. That’s our mission to get the most affordable cars to customers as fast as possible. These new vehicles we built on our existing lines and open capacity, and that’s a major shift to utilize all our capacity with marginal CapEx before we go spend high CapEx to do anything. |
7,044 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. We’ll talk about this more on August 8. But really, the way to think of Tesla is almost entirely in terms of solving autonomy and being able to turn on that autonomy for a gigantic fleet. And I think it might be the biggest asset value appreciation history when that day happens when you can do unsupervised full self-driving.
Lars Moravy: 5 million cars?
Elon Musk: Yes.
Lars Moravy: A little less?
Elon Musk: Yes. It will be 7 million cars in a year or so and then 10 million and then eventually, we’re talking about tens of millions of cars. Not eventually, it’s like, yes, for the end of the decade, its several tens of millions of cars I think.
Martin Viecha: Thank you. The next question is, what is the progress of Cybertruck ramp?
Lars Moravy: I can take that one too. Cybertruck had 1K a week just a couple of weeks ago. This happened in the first four to five months since we SOP [ph] late last year. Of course, volume production is what matters. That’s what drives costs and so our costs are dropping, but the ramp still faces like a lot of challenges with so many new technologies, some supplier limitations, et cetera, and continue to ramp this year, just focusing on cost efficiency and quality.
Martin Viecha: Okay. Thank you. The next question, have any of the legacy automakers contacted Tesla about possibly licensing FSD in the future?
Elon Musk: We’re in conversations with one major automaker regarding licensing FSD.
Martin Viecha: Thank you. The next question is about the robotaxi unveil. Elon already talked about that. So we’ll have to wait till August. The following question is about the next-generation vehicle. We already talked about that. So let’s go to the semi. What is the time line for scaling semi?
Elon Musk: I think… |
7,045 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I think…
Lars Moravy: So we’re finalizing the engineering of the semi to enable like a super cost-effective high-volume production with our learnings from our fleet and our pilot fleet and Pepsi’s fleet, which we are expanding this year marginally. In parallel, as we showed in the shareholders’ deck, we have started construction on the factory in Reno. Our first vehicles are planned for late 2025 with external customers starting in 2026.
Martin Viecha: Okay. A couple more questions. So our favorite, can we make FSD transfer permanent until FSD is fully delivered with Level 5 autonomy?
Lars Moravy: Yes.
Martin Viecha: Okay. Next question, what is the getting the production ramp at Lathrop, where do you see the Megapack run rate at the end of the year. Mike?
Unidentified Company Representative: Yes. Yes, Lathrop is ramping as planned. We have our second GA line allowing us to increase our exit rate from 20 gigawatt hours per year to – at the start of this year to 40 gigawatt hours per year by the end of the year, that lines commissioned. There’s really nothing limiting the ramp. Its given the longer sales cycles for these large projects, we typically have order visibility 12 months to 24 months prior to ship dates. So we’re able to plan – the build plan several quarters in advance. So this allows us to ramp the factory to align with the business and order growth. Lastly, we’d like to thank our customers globally for their trust in Tesla as a partner for these incredible projects.
Martin Viecha: Okay. Thank you very much. Let’s go to analyst questions. The first question comes from Tony Sacconaghi from Bernstein. Tony, please go ahead and unmute. |
7,046 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Tony Sacconaghi: Thank you for taking the question. I was just wondering if you can elaborate a little bit more on kind of the new vehicles that you talked about today. Are these like tweaks on existing models, given that they’re going to be running on the same lines? Are these like new models? And how should we think about them in the context of like the Model 3 Highland update, what will these models be like relative to that? And given the quick time frame, Model 3 Highland has required a lot of work and a lot of retooling. Maybe you can help put that all in context. Thank you, and I have a follow-up, please.
Elon Musk: I think we've said, we were on that front. So what’s your follow-up?
Tony Sacconaghi: It’s a more personal one for you, Elon, which is that you’re leading many important companies right now. Maybe you can just talk about where your heart is at in terms of your interests and do you expect to lessen your involvement with Tesla at any point over the next three years?
Elon Musk: Tesla constitutes a majority of my work time and I work pretty much every day of the week. It’s rare for me to take a Sunday afternoon. So I’m going to make sure Tesla is quite prosperous. And it is – like it is prosperous and it will be very much so in the future.
Martin Viecha: Okay. Thank you. Let’s go to Adam Jonas from Morgan Stanley. Adam, please go ahead and unmute.
Adam Jonas: Okay. Great. Hey, Elon. So you and your team on volume expect a 2024 growth rate, notably lower than that achieved in 2023. But what's your team's degree of confidence on growth above 0%? Or in other words, does that statement leave room for potentially lower sales year-on-year?
Elon Musk: No, I think we'll have higher sales this year than last year. |
7,047 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: No, I think we'll have higher sales this year than last year.
Adam Jonas: Okay. My follow-up, Elon, on future product. If you had nailed execution, assuming that you nail execution on your next-gen cheaper vehicles, more aggressive giga castings, I don't want to say one piece, but getting closer to one piece, structural pack, unboxed, 300-mile range, $25,000 price point, putting aside robotaxi, those features unique to you. How long would it take your best Chinese competitors to copy a cheaper and better vehicle that you could offer a couple of years from now? How long would it take your best Chinese competitors to copy that? Thanks.
Elon Musk: I mean, I don't know what our competitors could do, except we've done relatively better than they have. If you look at the drop in our competitors in China sales versus our drop in sales, our drop was less than theirs. So we're doing well. But I think Cathy Wood said it best, like really, we should be thought of as an AI or robotics company. If you value Tesla as just like an auto company, you just have to – fundamentally, it's just the wrong framework and it will come to be. If you ask the wrong question, then the right answer is impossible. So I mean, if somebody doesn't believe Tesla is going to solve autonomy, I think they should not be an investor in the company. Like, that is – but we will and we are. And then you have a car that goes from 10 hours of use a week, like 1.5 hours a day to probably 50%, but it costs the same.
Vaibhav Taneja: I think that's the key thing to remember, right, especially if you look at FSD Supervised, if you didn't believe in autonomy, this should give you a review that this is coming. It's actually getting better day by day.
Elon Musk: Yes. If you've not tried the FSD 12.3, and like I said, 12.4 is going to be significantly better and 12.5 even better than that. And we have visibility into those things. Then you really don't understand what's going on. It's not possible. |
7,048 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Yes. And that's why we can't just look at just as a car company because a car company would just have a car. But here, we have more than a car company because the cars can be autonomous. And like I said, it's happening.
Ashok Elluswamy: Yes. This is all in addition to Tesla – the overall AI community is just like increasing – like, improving rapidly.
Elon Musk: Yes. I mean we're putting the actual auto in automobile. So sort of – we go like, well, sort of like tell us about future horse carriages you're making. I'm like, well, actually, it doesn't need a horse that's the whole point. That's really the whole point.
Martin Viecha: Okay, thank you. The next question comes from Alex Potter from Piper Sandler. Alex, please go ahead and unmute.
Alex Potter: Great, thanks. Yes, so I couldn't agree more. The thesis hinges completely on AI, the future of AI, full self-driving neural net training, all of these things. In that context, Elon, you've spoken about your desire to obtain 25% voting control of the company. And I understand completely why that would be. So I'm not necessarily asking about that. I'm asking if you've come up with any mechanism by which you can ensure that you'll obtain that level of voting control. Because if not, then the core part of the thesis could potentially be at risk. So any additional commentary you might have on that topic. |
7,049 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Well, I think no matter what Tesla, even if I got kidnapped by aliens tomorrow, Tesla will solve autonomy, maybe a little slower, but it would solve autonomy for vehicles at least. I don't know if it would winon with respect to Optimus or with respect to future products, but it would that there's enough momentum for Tesla to solve autonomy even if I disappeared for vehicles. Yes, there's a whole range of things we can do in the future beyond that. I'll be more reticent with respect to Optimus, if we have a super-sentient humanoid robot that can follow you indoors and that you can escape, we're talking terminator-level risk. And yes, I'd be uncomfortable with. If there's not some meaningful level of influence over how that is deployed. And if there's shareholders have an opportunity to ratify or reratify the sort of competition because I can't say that. That is a fact. They have an opportunity. And yes, we'll see. If the company generates a lot of positive cash flow, we could obviously buy back shares.
Alex Potter: All right. That's actually all very helpful context. Thank you. Maybe one final question and I'll pass it on. OpEx reductions, thank you for quantifying the impact there. I'd be interested also in potentially more qualitative discussion of what the implications are for these headcount reductions. What are the types of activities that you're presumably sacrificing as a result of parting ways with these folks? Thanks very much. |
7,050 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: So like we said, we've done these headcount reductions across the board. And as companies grow over time, there are certain redundancies. There's some duplication of efforts, which happens in certain areas. So you need to go back and look at where all these pockets are, get rid of it. So we're basically going through that exercise wherein we're like, hey, how do we set this company right for the next phase of growth. And the way to think about it is any tree which grows, it needs pruning. This is the pruning exercise which we went through. And at the end of it, we'll be much stronger and much more resilient to deal with the future because the future is really bright. Like I said in my opening remarks, we just have to get through this period and get there.
Elon Musk: Yes, we're not giving up anything that is significant that I'm aware of. So we've had a long period of prosperity from 2019 to now. And so if a company sort of organizationally is 5% wrong per year, that accumulates to 25%, 30% of inefficiency. We've made some corrections along the way. But it is time to reorganize the company for the next phase of growth and you really need to reorganize it, just like a human when we start off with one cell and kind of zygote, blastocyst and you start growing arms and legs and briefly, you have a tail. And so…
Alex Potter: But you shed the tail. |
7,051 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Alex Potter: But you shed the tail.
Elon Musk: You shed the tail, hopefully. And then you're baby, you basically, you have to be the organism – a company is kind of like creature growing. And if you don't reorganize it for different phases of growth, it will fail. You can't have the same organizational structure if you're 10 cells versus 100 cells versus 1 million cells versus 1 billion cells versus 1 trillion cells. Humans are around 35 trillion cells, doesn't feel like it feels like, like one person. But you're basically a walking cell colony of roughly 35 trillion depending on your body mass and about three times that number in bacteria. So anyway, you've got to reorganize the company for a new phase of growth or will fail to achieve that growth.
Martin Viecha: Thank you. Let's go to Mark Delaney from Goldman Sachs. Mark please go ahead and unmute.
Mark Delaney: Yes. Good afternoon. Thanks very much for taking the question. The company previously characterized potential FSD licensing discussions in the early phase and some OEMs had not really been believing in it. Can you elaborate on how much the licensing business opportunity you mentioned today has progressed? And is there anything Tesla needs to achieve with the technology in terms of product milestones in order to be successful at reaching a licensing agreement in your view?
Elon Musk: Well, I think we just need to – it just needs to be obvious that our approach is the right approach. And I think it is. I think we've now with 12.3, if you just have the car drive you around; it is obvious that our solution with a relatively low-cost inference computer and standard cameras can achieve self-driving. No LiDARs, no radars, no ultrasonic nothing.
Vaibhav Taneja: No heavy integration work for vehicle manufacturers. |
7,052 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: No heavy integration work for vehicle manufacturers.
Elon Musk: Yes. So it really just be a case of having them use the same cameras and inference computer and licensing our software. But once it becomes obvious that if you don't have this in a car, nobody wants your car. It's a smart car. I still remember in, back when Nokia was king of the hill, Yes, crushing. And they certainly come out with a smartphone that was basically a break with limited functionality. And then the iPhone and Android, people still do not understand that all the phones are going to be that way. There's not going to be any flip [ph] phones. If there will be a niche product.
Lars Moravy: Or home phones.
Elon Musk: Yes, no even exactly. When is the last time you saw a home phone.
Lars Moravy: No idea in a hotel, sometimes in hotels.
Elon Musk: Yes, the hotels have them. Yes. So the people don't understand all cars will need to be smart cars, or you will not sell or the car will not – nobody would buy it. Once that becomes obvious, I think licensing becomes not optional.
Mark Delaney: It becomes a method of survival?
Elon Musk: Yes, absolutely, it is. License it or nobody will buy your car.
Vaibhav Taneja: I mean one other thing which I'll add is in the conversations, which we've had with some of these OEMs, I just want to also point out that they take a lot of time in their product life cycle.
Elon Musk: Yes.
Vaibhav Taneja: They're talking about years before they will put it in their product. We might have a licensing deal earlier than that, but it takes a while. So this is where the big difference between us and them is, right?
Elon Musk: Yes, I mean, really a deal signed now would result in it being in a car probably three years.
Vaibhav Taneja: That would be early.
Elon Musk: Yes. That's like lightening basically.
Lars Moravy: That's in eager [ph] OEM. |
7,053 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: That would be early.
Elon Musk: Yes. That's like lightening basically.
Lars Moravy: That's in eager [ph] OEM.
Elon Musk: Yes. So I wouldn't be surprise if we do sign a deal. I think we have a good chance we do sign a deal this year, maybe more than one. But yes, it would be probably three years before it's integrated with a car. Even though all you need is cameras and our inference computer. So just talking about a massive design change.
Vaibhav Taneja: Yes. And again, just to clarify, it's not the work which we have to do. It's the work which they have to do, which will take the time.
Elon Musk: Yes.
Vaibhav Taneja: Mark, is it helpful?
Mark Delaney: Yes, very helpful. Thank you. My follow-up was to better understand Tesla's approach to pricing going forward. Previously, the company had said that the price reductions were driving incremental demand with how affordable the cars have become, especially for vehicles that have access to IRA credits and some of the leasing offers that Tesla has in place. Do you still see meaningful incremental price reductions as making sense from here for the existing products? And can the company meaningfully lower prices from here and also stay free cash flow positive on an annual basis with the current product set? Thanks.
Elon Musk: Yes. I think we can be free cash flow positive meaningfully.
Lars Moravy: I think Vaibhav said it in his opening remarks, like our cost down efforts, we basically were offsetting the price cut like we’re trying to give it back to the customers. |
7,054 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes. I mean the end of the day, like for any given company, if you sell a great product at a great price – if you have a great product at a great price, the sales will be excellent. That’s true of any area. So over time, we do need to keep making sure that we’re – that it’s a great product at a great price. And moreover, that price is accessible to people. So it’s not – you have to solve both the value for money and the fundamental affordability question. The fundamental affordability question is sometimes overlooked. If somebody is earning several hundred thousand dollars a year, they don’t think of a car from a fundamental affordability standpoint. But from vast majority of people are living paycheck to paycheck. So it actually makes a difference if the cost per month for lease refinancing is $10 one way or the other. So it is important to keep improving the affordability and to keep making the price.
Lars Moravy: More accessible.
Elon Musk: Yes, exactly. Make the price more accessible, the value for money better, and to keep improving that over time.
Lars Moravy: But also make kick as cost that people want to buy.
Elon Musk: Yes, it’s going to be a great product and at a great price. And the standards for what constitutes great product at a great price keep increasing. So there’s like – you can’t just be static. You have to keep making the car better, improving the price, but improving the cost of production, and that’s what we’re doing.
Vaibhav Taneja: Yes. And in fact, like I said in my opening remarks also, like the revised – the updated Model 3 is a fantastic car. I don’t think people fully even understand that lot of engineering effort which has gone and Lars and team have actually put out videos explaining how much the car is different. I mean it looks and feels different. Not only it looks and feels different. We’ve added so much value to it, but you can lease it for like as low as $299 a month.
Lars Moravy: Without gas.
Vaibhav Taneja: Yes. |
7,055 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Without gas.
Vaibhav Taneja: Yes.
Martin Viecha: All right. The next question comes from George from Canaccord. George, please go ahead and unmute.
Unidentified Analyst: Hi, thank you for taking my question. First, could you please help us understand some of the timing of launching FSD in additional geographies, including maybe clarifying your recent comment about China? Thank you.
Elon Musk: I mean like new markets, yes, we are – there are a bunch of markets where we don’t currently sell cars that we should be selling cars in. We’ll see some acceleration of that.
Unidentified Analyst: And FSD new markets?
Elon Musk: Yes. So think about the end-to-end neural net-based autonomy is that just like a human, it actually works pretty well without modification in almost any market. So we plan on – with the approval of the regulators, releasing it as a supervised autonomy system in any market that – where we can get regulatory approval for that, which we think includes China. So yes, it’s – just like a human, you can go rent a car in a foreign country and you can drive pretty well. Obviously, if you live in that country, you’ll drive better. And so we’ll make the car drive better in these other countries with country-specific training. But it can drive quite well almost everywhere.
Vaibhav Taneja: The basics of driving are basically same everywhere like car is a car, the traffic lights, road is the road. Yes.
Elon Musk: It understands that it shouldn’t hit things, no matter what the road rules are.
Vaibhav Taneja: Exactly. There are some road rules that you need to follow. And in China, you shouldn’t cross over a solid line to do a lane change. In U.S. it’s a recommendation I think. In China, you get fined heavily if you do that. We have to do some more actions, but it’s mostly smaller reduction. It’s not like the entire change or type or something.
Elon Musk: Yes.
Martin Viecha: Hey, George, do you have a follow-up? |
7,056 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yes.
Martin Viecha: Hey, George, do you have a follow-up?
Unidentified Analyst: Yes. So my follow-up has to do with the first quarter deliveries and I’m curious as to whether or not you feel that supply constraints that you mentioned throughout the release impacted the results and maybe can you help us quantify that? And is that why you have some confidence in unit growth in 2024?
Vaibhav Taneja: Yes. I think we did cover this a little bit in the opening remarks to you. Q1 had a lot of different things which are happening. Seasonality was a big one, continued pressure from the macroeconomic environment. We had attacks at our factory. We had Red Sea attacks, we are ramping Model 3, we’re ramping Cybertruck. All these things are happening. I mean, it almost feels like a culmination of all those activities in a constrained period. And that gives us that confidence that, hey, we don’t expect these things to recur.
Elon Musk: Yes. We think Q2 will be a lot better.
Vaibhav Taneja: Yes.
Lars Moravy: It’s just one thing after another. Our Cybertrucks are crazy. Thank you.
Elon Musk: Yes, exactly. It’s just – if you’ve got cars that are sitting on ships, they obviously cannot delivered to people. And if you’ve got the excess demand for Model 3 and Model Y in one market, but you don’t have it there. It’s quite a – it’s extremely complex logistics situation. So I’d say also the – we did overcomplicate the sales process, which we’ve just in the past week or so have greatly simplified. So it became far too complex to buy a Tesla, whereas it should just be you can buy the car in under a minute. So we’re getting back to that you can buy a Tesla in under an minute interface from what was quite complex.
Martin Viecha: Okay, thank you. Let’s go to Colin Rusch from Oppenheimer. Colin, go ahead and unmute, please. |
7,057 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Martin Viecha: Okay, thank you. Let’s go to Colin Rusch from Oppenheimer. Colin, go ahead and unmute, please.
Colin Rusch: Thanks so much, guys. Given the pursuit of Tesla really as a leader in AI for the physical world, in your comments around distributed inference, can you talk about what that approach is unlocking beyond what’s happening in the vehicle right now?
Elon Musk: Do you want to say something?
Ashok Elluswamy: Yes. Like Elon mentioned like the car even when it's a full robotaxi it's probably going to be used 150 hours a week.
Elon Musk: That's my guess like a third of the hours of the week.
Ashok Elluswamy: Yes. It could be more or less, but then there's certainly going to be some hours left for charging and cleaning and maintenance in that world, you can do a lot of other workloads, even right now we are seeing, for example, these LLM companies have these like batch workloads where they send a bunch of documents and those run through pretty large neural networks and take a lot of compute to chunk through those workloads. And now that we have already paid for this compute in these cars, it might be wise to use them and not let them be idle, be like buying a lot of expensive machinery and leaving to them idle. Like we don't want that, we want to use the computer as much as possible and close to like basically 100% of the time to make it a use of it.
Elon Musk: That’s right. I think it's analogous to Amazon Web Services, where people didn't expect that AWS would be the most valuable part of Amazon when it started out as a bookstore. So that was on nobody's radar. But they found that they had excess compute because the compute needs would spike to extreme levels for brief periods of the year and then they had idle compute for the rest of the year. So then what should they do to pull that excess compute for the rest of the year? That's kind of...
Ashok Elluswamy: Monetize it |
7,058 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: Monetize it
Elon Musk: Yes, monetize it. So, it seems like kind of a no-brainer to say, okay, if we've got millions and then tens of millions of vehicles out there where the computers are idle most of the time that we might well have them do something useful.
Ashok Elluswamy: Exactly.
Elon Musk: And then, I mean, if you get like to the 100 million vehicle level, which I think we will, at some point, get to, then – and you've got a kilowatt of useable compute and maybe your own hardware 6 or 7 by that time. Then you really – I think you could have on the order of 100 gigawatts of useful compute, which might be more than anyone more than any company, probably more than a company.
Ashok Elluswamy: Yes, probably because it takes a lot of intelligence to drive the car anyway. And when it's not driving the car, you just put this intelligence to other uses, solving scientific problems or answer in terms of someone else.
Elon Musk: It's like a human, ideally. We've already learned about deploying workloads to these nodes
Ashok Elluswamy: Yes. And unlike laptops and our cell phones, it is totally under Tesla's control. So it's easier to distribute the workload across different nodes as opposed to asking users for permission on their own cell phones to be very tedious.
Elon Musk: Well, you're just draining the battery on the phone.
Ashok Elluswamy: Yes, exactly. The battery is also...
Elon Musk: So like technically, I suppose like Apple would have the most amount of distributed compute, but you can't use it because you can't get the – you can't just run the phone at full power and drain the battery.
Ashok Elluswamy: Yes.
Elon Musk: So, whereas for the car, even if you're a kilowatt level inference computer, which is crazy power compared to a phone. If you've got 50 or 60 kilowatt hour pack, it's still not a big deal to run if you are plugged it – whether you plugged it or not – you could be plugged in or not like you could run for 10 hours and use 10-kilowatt hours of your kilowatt of compute power. |
7,059 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Yes. We got built in like liquid cold thermal management.
Elon Musk: Yes, exactly.
Lars Moravy: Exactly for data centers, it's already there in the car.
Elon Musk: Exactly. Yes. Its distributed power generation – distributed access to power and distributed cooling, that was already paid for.
Ashok Elluswamy: Yes. I mean that distributed power and cooling, people underestimate that costs a lot of money.
Vaibhav Taneja: Yes. And the CapEx is shared by the entire world sort of everyone wants a small chunk, and they get a small profit out of it, maybe.
Elon Musk: Yes.
Colin Rusch: Thanks so much guys. And just my follow-up is a little bit more mundane. Looking at the 4680 ramp, can you talk about how close you were to target yields and when you might start to accelerate incremental capacity expansions on that technology?
Elon Musk: We're making good progress on that. But I don't think it's super important for at least in the near term. As Lars said, we think it will be exceed the competitiveness of suppliers by the end of this year and then we'll continue to improve.
Lars Moravy: Yes. I mean, I think it's important to note also that like the ramp right now is relevant to the Cybertruck ramp.
Elon Musk: Yes.
Lars Moravy: And so like we're not going to just randomly build 4680s unless we have a place to put them and so we're going to make sure we're prudent about that. But we also have a lot of investments with all our cell suppliers and vendors. They're great partners, and they've done great development work with us and a lot of the advancements in technologies and chemistry we found 4680, they're also putting into their cells.
Elon Musk: Yes. I mean a big part of the 4680, Tesla doing internal cells was a hedge against what would happen with our suppliers because for a while they are it was very difficult because every big carmaker put in massive battery orders, and so the price per kilowatt hour of lithium-ion batteries went to crazy numbers, crazy levels.
Vaibhav Taneja: Bonkers. |
7,060 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Bonkers.
Elon Musk: Yes, just bonkers. So like, okay, we've got to have some hedge here to deal with cost per kilowatt hours of numbers that were double what we anticipated. If we have an internal cell production, then we have that hedge against demand shocks, we have too much demand. That's really the way to think about it. It's not like we want to take on a whole bunch of problems just for the hell of it. We did the cell program in order to address the crazy increase in cost per kilowatt hour from our suppliers due to gigantic orders placed by every carmaker on earth.
Martin Viecha: Okay. Thank you. And the last question comes from Ben Kallo from Baird. Ben, go ahead and unmute. Ben, you're still muted.
Elon Musk: Well, I want to say again, we'd just like to strongly recommend that anyone who is, I guess, thinking about the Tesla stock should really drive FSD 12.3. It really – you can't – it's impossible to understand the company if you do not do this.
Martin Viecha: All right. So since Ben is not unmuting. Let's try Shreyas Patil from Wolfe Research. Final question.
Shreyas Patil: Thanks so much. Just Elon, during the Investor Day last year, you mentioned that auto COGS per unit for the next-gen vehicle would decline by 50% versus the current three and Y. I think that was implying something around $20,000 of COGS. About one-third of that was coming from the on-box manufacturing process. But I'm curious if you see an opportunity that the – some of the other drivers around powertrain cost reduction or material cost savings, would those be largely transferable to some of the new products that you're now talking about introducing? |
7,061 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Yes, sure. I mean, in short, yes, I mean, like the on-box manufacturing method is certainly great and revolutionary, but with it comes some risks because new production lines and not, but all the subsystems we developed, whether it was powertrains, drive units, battery improvements in manufacturing and automation, thermal systems, seating, integration of interior components and reduction of LV controllers, all that's transferable, and that's what we're doing, trying to get it in their products as fast as possible. And so yes, that engineering work, we're not trying to just throw it away and put a cars and we're going to take it and utilize it and utilize it to the best advantage of the cars we make and the future cars make.
Shreyas Patil: Okay. Great. And then just on that topic of 4680 cells, I know you mentioned it, you really thought of it more as like a hedge against rising battery costs from other OEMs. But it seems even today, it seems like you would have a cost advantage against some of those other automakers. And I'm wondering, given the rationalizing of your vehicle manufacturing plans that you're talking about now, if there's an opportunity to maybe convert the 4680 cells and maybe sell those to other automakers and really generate an additional revenue stream. I'm just curious if you have any thoughts about that.
Elon Musk: Great. What seems to be happening is that the I'm missing something, the orders for batteries from other automakers have declined dramatically. So we're seeing much more competitive prices for sales from our suppliers, dramatically more competitive than in the past. It is clear that a lot of our suppliers have excess capacity. |
7,062 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Yes. In addition to what Elon, this is kind of in addition to what Elon said, about 4680, what 4680 did for us from a supply chain perspective was help us understand the supply chain that's upstream of our cell suppliers. So a lot of the deals that we had struck for 4680, we can also supply those materials to our partners, help reducing the overall cost back to Tesla. So we're basically inserting ourselves in the upstream supply chain by doing that. So that's also been beneficial in reducing the overall pricing in addition to the excess capacity that these suppliers have.
Elon Musk: Yes. No, I mean this is going to wax and wane, obviously. So there's going to be a boom and bust in battery cell production where production exceeds supply and then supply exceeds production and back and forth kind of like, I don't know, DRAM or something. But Yes. So it's like what is true today will not be true in the future, there's going to be somewhat of a boom and bust cycle here. And then there are additional complications with government incentives like the Inflation Reduction Act, the IRA, Joe [ph] has found like a funny name.
Vaibhav Taneja: Comical name.
Elon Musk: Yes, it is like Irish Republican Army, The Internet Research Agency from Russia.
Vaibhav Taneja: Independent retirement account.
Elon Musk: Yes, exactly. Roth IRA. It's like Spider-Man situation, which IRA wins. So but it is complicate the incentive structure. So that is there's the stronger demand for cells that are produced in the U.S. than outside the U.S. But then how long is that the IRA last, I don't know.
Vaibhav Taneja: Which is why it's important that we have both internet [ph] cells and vendor cells that hedge against all of this. |
7,063 | TSLA | 1 | 2,024 | 2024-04-23 17:30:00 | Tesla, Inc. | 27,444,752 | Martin Viecha: Okay. Thank you very much. That's all the time we have today. But at the same time, I would like to make a short announcement. And I wanted to let the investment community know that about a month ago, I met up with Elon and Vaibhav and announced that I'll be moving on from the world of Investor Relations. I'll be hanging around for another couple of months or so. So feel free to reach out at any time. But after the seven year sprint, I'm going to be taking a break and spending some good quality time with my family. And I wanted to say that these seven years have been the greatest privilege of my professional life. I'll never forget the memories from I started literally at the beginning of production hell and just watching the company from the inside to see what it's become today. And especially super thankful to the people in this room and dozens of people outside of this room that I've worked for over the years. I think the team's strength and teamwork at Tesla is unlike anything else I've seen in my career. Elon, thank you very much for this opportunity that I got back in 2017. Thank you for seeking investor feedback and regularly and debating it with me.
Elon Musk: Yes. Well, I mean the reason I reached out to you was because I thought your analysis of Tesla was the best that I had seen.
Martin Viecha: Thank you.
Elon Musk: So, thank you for helping Tesla to get to where it is today over seven years. It's been a pleasure working with you.
Martin Viecha: Thank you so much. And yes, thank you for all the thousands of shareholders that we've met over the years and walked around factories and loved all the interactions, even the tough ones. And yes, looking forward to the call in the next three months, but I'll be on the other side, listening in. Thank you very much.
Vaibhav Taneja: Thanks. |
7,064 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Operator: Good afternoon, everyone, and welcome to Tesla's First Quarter 2025 Q&A Webcast. My name is Travis Axelrod, Head of Investor Relations, and I'm joined today by Elon Musk, Vaibhav Taneja, and a number of other executives. Our Q1 results were announced at about 3 p.m. Central Time in the update deck we published at the same link as this webcast. During this call, we will discuss our business outlook and make forward looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC. During the question-and-answer portion of today's call, please limit yourself to one question and one follow-up. Please use the raise hand button to join the question queue. Before we jump into Q&A, Elon will be providing an update. Elon? |
7,065 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Hello, everyone. Well, there’s never a dull moment these days. Thanks for sure. Every day is going to be exciting. As some people know, there's been some blowback for the time that I've been spending in government with the Department of Government Efficiency or DOGE. I think the work that we're doing there is actually very important for trying to sprain in the insane deficit that is leading our country, the United States, to destruction. And the DOGE team has made a lot of progress in addressing waste and fraud. The natural blowback from that is those who were receiving the wasteful dollars and the fortunate dollars will try to attack me and DOGE team and anything associated with me. So, but then I'm really left with two choices. Should we just let the waste and fraud continue? And it was continuing at a -- to grow at a really unsustainable pace that was bankrupting the country or to fight the waste and fraud and try to get the country back on the right track. And I believe the right thing to do is to just fight the waste and fraud and get the country back on the right track and working together with President Trump and his administration. Because if the ship of America goes down, we all go down with it, including Tesla and everyone else. So, I think this is critical work. Now, the protests that you'll see out there, they're very organized, they're paid for. They're obviously not going to say, admit that the reason that they're protesting is because they're receiving fraudulent money or that they are the recipients of wasteful largesse, but they're going to come up with some other reason. But that is - the real reason for the protests, the actual reason is that those receiving the waste and fraud wish to continue receiving it. That is the real thing that's going on here, obviously. So, now that said, I do think there's the large slug of work necessary to get the DOGE team in place and working in the government to get the financial house in order is mostly done. And I think starting probably next |
7,066 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | in place and working in the government to get the financial house in order is mostly done. And I think starting probably next month, May, my time allocation to DOGE will drop significantly. I'll have to continue doing it for, I think, probably the remainder of the President's term, just to make sure that the waste and fraud that we stop does not come roaring back, which will do if it has the chance. So, I think I'll continue to spend a day or two per week on government matters for as long as the President would like me to do so and as long as it is useful. But starting next month, I'll be allocating probably more of my time to Tesla and now that the major work of establishing the Department of Government Efficiency is done. So, at Tesla, we've gone through many, many crises over the years and actually been through many near-death experiences. We were probably on the ragged edge of death at least on maybe a dozen times. It's been so many times. This is not one of those times. We're not on the ragged edge of death, not even close. So -- but there are some challenges, and I expect that this year will be, there will probably be some unexpected bumps this year. But I remain extremely optimistic about the future of the company. The future of the company is fundamentally based on large-scale autonomous cars and large-scale, large volume, vast numbers of autonomous humanoid robots. So the value of a company that makes truly useful autonomous humanoid robots and autonomous useful vehicles at scale at low cost, which is what Tesla is going to do, is staggering. I continue to believe that Tesla, with excellent execution, will be the most valuable company in the world by far. But that's an important if, we must execute well. But if we do execute well, I think Tesla will be the most valuable company in the world by far. It may be as valuable as the next five companies combined. So, but there'll be a few bumps along the road before that happens. I said I think on the last earnings call that we'll start to see the prosperity |
7,067 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | a few bumps along the road before that happens. I said I think on the last earnings call that we'll start to see the prosperity of autonomy take effect in a material way around the middle of next year. We expect to have these -- be selling fully autonomous rides in June in Austin, as we've been saying for now several months. So that's continued, but the real question from financial standpoint is when does it really become material and affect bottom line of the company and start to be a fundamental part of the -- when does it move the financial needle in a significant way? That's probably around the middle of next year, second half of next year. And then once it does start to move the financial needle in a significant way, it will really go exponential from there. So that's, I'd encourage people to look beyond like the, some sort of bumps and bundles of each road immediately ahead of us. But left your gaze to the bright shining sort of down the hill, I don't know, some Reagan-esque imagery. And that's where we're headed and not too distant future. Like I said, kind of next year or two. So, let's see. With respect to supply chain risk, something that Tesla has been working on for several years is to localize supply chains. This actually makes sense from a cost standpoint and from a logistics risk standpoint, is to have the supply chains be at least located on the continent in which the car is built. And so we are, I think the least, a company, the least affected car company with respect to tariffs, at least in most respects, I mean, it remains to be seen. Now, tariffs are still tough on a company when margins are still low. But we do have localized supply chains in North America, Europe, and China. So that puts us in a stronger position than any of our competitors. And undoubtedly, I'm going to get a lot of questions about tariffs, and I just want to emphasize that the tariff decision is entirely up to the President of the United States. I will weigh in with my advice with the President, which he will listen to my |
7,068 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | up to the President of the United States. I will weigh in with my advice with the President, which he will listen to my advice, but then it's up to him, of course, to make his decision. I've been on the record many times saying that I believe lower tariffs are generally a good idea for prosperity, but this decision is fundamentally up to the elected representative of the people being the President of the United States. So, you know, I'll continue to advocate for lower tariffs rather than higher tariffs, but that's all I can do. So, now let me walk you through why I'm so excited about the future of Tesla. So, first of all, autonomy. The team and I are laser focused on bringing robotaxi to Austin in June. Unsupervised autonomy will first be solved for the Model Y in Austin. And then -- actually you should parse out the terms robotic taxi or robotaxi and just generally like what's the Cybercab because we've got a product called the Cybercab and then any Tesla which could be an S3 extra wide that is autonomous is a robotic taxi or robotaxi. It's very confusing. So the vast majority of the Tesla fleet that we've made is capable of being a robotaxi or robotic taxi. And as we're going from -- once we can make the whole system work where you can have paid rides fully autonomously with no one in the car in one city, that is a very scalable thing for us to go broadly within whatever jurisdiction allows us to operate. So, because we're solving for is a general solution to autonomy, not a city specific solution for autonomy. Once we make it work in a few cities, we can basically make it work in all cities in that legal jurisdiction. So, if it’s -- once we can make it based to work in a few cities in America, we can make it work anywhere in America. Once we can make it work in a few cities in China, we can make it work anywhere in China, likewise in Europe, limited only by regulatory approvals. So, this is the advantage of having a generalized solution using artificial intelligence. And the -- an AI chip that Tesla designed |
7,069 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | this is the advantage of having a generalized solution using artificial intelligence. And the -- an AI chip that Tesla designed specifically for this purpose as opposed to very expensive sensors and high precision maps of a particular neighborhood where that neighborhood may change or often changes and then the car stops working. So, we have a general solution instead of a specific solution. Then, with regards to Optimus, we’re making good progress in Optimus. We expect to have thousands of Optimus robots working in Tesla factories by the end of this year, 10 years forward. And we expect to scale Optimus up faster than any product, I think, in history, to get to millions of units per year as soon as possible. I think I feel confident in getting to a million units per year in less than five years, maybe five years. So, by 2030, I feel confident in predicting a million Optimus units per year, it might be 2029. So, let's see with respect to energy, energy business is doing very well. The Megapack is -- enables utility companies to output far more total energy than would otherwise be the case. When you think of the energy capability of a grid, it's much more than, say, total energy output per year. If the powerplants could operate at peak power for all 24 hours, as opposed to being at half power, sometimes a quarter power at night, then you could double the energy output of existing power plants. But in order to do that, you need to buffer the energy, so that you can charge up something like a battery pack at night and then discharge into the grid during the day. So, this is a massive unlock on total energy output of any given grid over the course of a year. And utility companies are beginning to realize this and are buying in our Megapacks at scale. So, at this point, a gigawatt class battery is quite a common thing. So, we have many orders and offer for gigawatt and beyond batteries. And we expect the energy -- the stationary energy storage business to scale ultimately to terawatts per year. So very, very good |
7,070 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | we expect the energy -- the stationary energy storage business to scale ultimately to terawatts per year. So very, very good numbers. Now, Q1, first quarters of a year are usually pretty tricky. Because it's usually the worst quarter of the year because people don't want to go buy a car in the middle of winter during the blizzard. So we picked Q1 as a good quarter to do a cutover to the new version of the Model Y and we changed production of the world's best selling cars with -- remember the Model Y is the best selling car of any kind on earth with a 1.1 billion unit per year output of a single model. And we did this changeover at the same time in factories all across the world. So congratulations to the Tesla team on an amazing job in pulling off what is a very difficult transition. So yeah, it's really very impressive work. So, yeah. In conclusion, while there are many near-term headwinds for us and the border industry, the future for Tesla is brighter than ever. The value of the company is delivering sustainable abundance with our affordable AI powered robots. So this, I like this phrase, sustainable abundance for all. If you say, like, what's the ideal future that you can imagine? That's what you'd want. You'd want abundance for all in a way that's sustainable. It's good for the environment. Basically, this is the happy future. If you say what's the happiest future you can imagine. One which is that would be a future where there's sustainable abundance for all. Closest thing to heaven we can get on Earth, basically. So, thank you again to the test team for all their efforts of the challenging time. I look forward to continuing to lead the team to great success in the future. |
7,071 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Great. Thank you very much, Elon. Before we move on, Vaibhav has some opening remarks as well. |
7,072 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: Thanks, Elon. As Elon mentioned, in Q1, we achieved something which has never been undertaken in the automotive industry of updating all our factories for the best-selling car in the world, all at the same time. And this is, people don't understand, this was not a small feat. We're not aware of anybody else being able to do the best-selling car all at once within a quarter. And that too hitting all the timelines which we had established at the beginning. So, big kudos to the team for making this happen. Additionally, we also hit record gross profit for energy storage business in the quarter. Now, getting back into the business, there has been a lot of speculation as to the reasons for decline of our vehicle deliveries in the first quarter. We had previously guided that we will be updating all factories and this will lead to several weeks of lost production, which did happen as planned. The ripple effect of the change is not having enough new Model Y available in most markets for people to see and experience till the last few weeks of the quarter. Additionally, the negative impact of vandalism and unwanted hostility towards our brand and our people had an impact in certain markets. Despite this, we were able to sell out legacy Model Y in US, China, and a few other markets within the world. And again, just so that people understand, we were producing the legacy Model Y till middle to end of February. And we switched over and we were able to still sell out within that period. So, again, big achievement by all the people at Tesla to make it happen. We've been extremely -- we have a very extremely competitive vehicle lineup, which with most vehicles going through a recent update, and add to that, if it wants an FSD, you have a personal chauffeur which can take you almost anywhere under supervision. There are numerous stories shared by customers ranging from how it has improved their daily commute, to providing mobility to customers with disabilities, to giving older customers the ability to travel |
7,073 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | their daily commute, to providing mobility to customers with disabilities, to giving older customers the ability to travel comfortably and independently. Not only is FSD Supervised safer than a human driver, but it is also improving the lives of individuals who experience it. And again, this is something you have to experience, and anybody who has experience just knows it. And we've been doing a lot lately to try and get those stories out, at least on X, so that people can see how other people have benefited from this. Now, coming into some of the financial stuff, auto margins declined sequentially primarily due to a reduction in the total number of deliveries, lower fixed cost absorption due to factory change awards and lower regulatory credit revenues offset by a slight increase in pricing due to the launch of new Model Y despite incentives which we had to sell legacy Model Y. Our energy storage business, like I said before, has achieved yet another milestone of create highest gross profit in the quarter. This was despite sequential decline in deployments. The importance of this business, as Elon mentioned, is pretty profound, especially in this environment. Because, in order for our grid to work properly with the demands from AI and all this, you need some more stability. This is by far the simplest and best solution, which we are aware of, which can help do this. And we've also developed certain unique solutions to help our customers to achieve this. Additionally, on the Powerwall side, we've been selling the new Powerwall 3, and it's been received with very good reception from customers, and to the extent that we are currently supply constraint. On services and other margins, they were slightly down sequentially, primarily because of the pressure on our used car business and insurance business. Note that we continued our journey to improve profitability in our services and collision business through better labor productivity. As previously discussed, our operating expenses continue to increase sequentially, |
7,074 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | business through better labor productivity. As previously discussed, our operating expenses continue to increase sequentially, primarily due to our AI-related initiatives, including Optimus, and also cost of development for our vehicle programs, including Cybercabs, SEMA, and cheaper models. These expenses flow through R&D. We believe even in the current environment, it is the right strategy, in making investments in these areas to position us for the long term. These increases were offset by decreases in SG&A changes in our vertical effort program. Other income reduced significantly on a sequential basis. The primary reason was Bitcoin mark to market loss in Q1 versus gain in Q4, resulting in a $472 million drop. The remainder of the change is because of FX reimbursement. With the adoption of the new mark to market standard for Bitcoin, we expect increased volatility in other income in addition to the FX volatility. I know tariffs is the hottest topic which people talk about and it has various impacts to our business. And as Elon mentioned, on the vehicle business, we've been on this journey of regionalization for years. Specifically in the US, Model Y has been rated the most American model made car on Cars.com Made in America index three years ago. [This end product] (ph) of the all the work which team has been doing all the years and to the extent that today, if you look at our vehicle lineup in US, we're about approximately on a weighted average basis 85% USMCA compliant. So, like Elon said, this definitely gives us a bigger edge as compared to our other OEMs in terms of managing the tariffs, but we're not immune because when the Section 232 auto tests become effective in May, which includes Canada and Mexico, and Canada and Mexico has been part of our regionalization study. They will have an impact on profitability. And I know research modeling on this impact has been up about a couple of thousand units which is pretty much in line with what we've been forecasting. The impact of tariffs on the energy |
7,075 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | a couple of thousand units which is pretty much in line with what we've been forecasting. The impact of tariffs on the energy business will be outsized since we source LFP battery cells from China. We're in the process of commissioning equipment for the local manufacturing of LFP battery cells in the US. However, the equipment which we have can only service a fraction of our total installed capacity of late. We've also been working on securing additional supply chain from non-China based suppliers, but it will take time. Also note that, in spite of all the impact on US from energy -- from tariffs on the energy business, we do have a Megafactory China which just started operations in Q1, and that should take care of our business outside of the US. There's also an important impact of tariffs on our capital investments. I know this is going to sound counterintuitive since in order to launch manufacturing or expand lines, we have to bring equipment from outside the US because there is not that much capacity in the US. And the current trade environment, such equipment being brought in is subjective. |
7,076 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: The expense is bringing in from China right now.
Vaibhav Taneja: Exactly. And the reality is that China has the basic one, which has the most capacity to provide [indiscernible]. Our CapEx guidance inclusive of [tariffs] (ph), even with the optimization we have tried to do, it is forecasted to be still in excess of 10 billion this year. We're still evaluating what more to do on this one. To summarize, we have near-term challenges in our business due to tariffs and brand image. We think our strategy of providing the best product at a competitive price is going to be a winner, and this is the reason we're still focused on bringing cheaper models to market soon. The start of production is still planned for June. Additionally, the advancement in FSD related features, including pilot robotaxi launch in Austin later this year, should help create a new era of demand. I would like to thank everyone at Tesla and our customers.
Travis Axelrod: Fantastic. Thank you very much, Vaibhav.
A - Travis Axelrod: Now, we will move on to investor questions. We will start with questions from say.com. First question is, what are the highest risk items on the critical path to robotaxi launch and scaling?
Ashok Elluswamy: It is Ashok.
Travis Axelrod: Yeah, we've got Ashok on line. |
7,077 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Sure. Well, just to talk about the -- disambiguate Cybercab from robotaxi once again. So, the -- when will -- the Tesla's because the Tesla's that will be fully autonomous in June in Austin are probably Model Ys. So, that is currently on track to be able to do paid rides fully autonomously in Austin in June and then to be in many other cities in the US by the end of this year. It's very difficult to predict the exact ramp sort of week by week and month by month except that it will ramp up very quickly. So, it's going to be like some basically an S curve where it's very difficult to predict the intermediate slope of the S curve, but you kind of know where the S curve is going to end up, which is the vast majority of the Tesla fleet being autonomous. So, that's why I feel confident in predicting large scale autonomy around the middle of next year, but yeah. Certainly the second half of next year, meaning, I predict that there will be millions of Tesla's operating autonomously, fully autonomously in the second half of next year. Yeah. It does seem increasingly likely that there will be a localized parameter set, especially for places that have, say, very snowy weather, like, say, if you're in the northeast or something. Like this, you can think of it, it's kind of like a human. Like, if you, you can be a very good driver in California, but are you going to be also a good driver in a blizzard in Manhattan? You're not going to be as good. So there is actually some value in, you still drive, but you're probably, of an accident is higher. So it's increasingly obvious that there's some value to having a localized set of parameters for different regions and localities. But this is -- I’ll put that in the nice-to-have category, not -- it's not the required category. Again, it's -- really the car is, it's just very much like the human. It's digital neural nets and cameras and humans operate with biological neural nets and eyes. And so the same strengths and weaknesses will be present. Or, a digital neural net |
7,078 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | with biological neural nets and eyes. And so the same strengths and weaknesses will be present. Or, a digital neural net and cameras versus a biological neural net and eyes. Ashok, if you'd like to elaborate on that. |
7,079 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: Yeah, speaking to the location specific models, we still have a generalized approach and you can see that from deployment of FSD Supervised in China, with this very minimal data that's China specific, the models generalize quite well to completely different driving styles. That just shows that the AI-based solution that we have is the right one because if you have gone down the previous rule-based solutions or like more hard-coded HD map-based solutions, it would have taken many, many years to get China to work. You can see those in the videos that people post online themselves. So, the generalized solution that we are pursuing is the right one that's going to scale well. And you can think of this location specific parameters that you don't need to ask a mixture of experts. And if you are sort of like familiar with the AI models, the Grok and others, they all use this mixture of experts to sort of like specialize the parameters to specific tasks while still being general. This makes the model use limited amount of compute to solve for the diversity of tasks that it has to solve. In terms of addressing the question that asked for, what are the critical things that need to get right, one thing I would like to note is validation. Self-driving is a long-tail problem where there can be a lot of edge cases that only happen very, very rarely. Currently, we are driving around in Austin using our QA fleet, but then it's super rare to get interventions that are critical for robotaxi operation. And so you can go many days without getting any single intervention. So you can't easily know whether you are improving or regressing in your capacity. And we need to build out sophisticated simulations, including neural network based video generation. That's all happening in the background to make sure that we deliver a safe product and we are able to measure our safety even though we can't just exceed when we're driving around the block or something like that. |
7,080 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yeah, I mean, very basic terms. If that -- if we're seeing an accident every 10,000 miles, well, then you have to drive 10,000 miles of average before you get an accident or an intervention. So, it's like, okay, I mean, we must be really, you don’t have to be very worked out by the sheer number of Teslas doing [indiscernible] in Austin right now. We're like, it's going to look pretty bizarre.
Ashok Elluswamy: Some people are chasing us away.
Elon Musk: Yeah, there's just always a convoy of Teslas going. Well, just going all over to Austin in circles. But yeah, I just can't emphasize this enough, in order to get -- figure out long tail things, it was one in 10,000, that says one in 20,000 miles, well one in 30,000. The average person drives 10,000 miles in a year. So, now try to compress that test cycle into a matter of a few months. That means you need a lot of cars doing a lot of driving in order to compress that or to do in a matter of a month what would normally take someone a year.
Ashok Elluswamy: Yeah, and I would just also add that if you haven't looked at those videos coming out of China, people are really…
Elon Musk: Yeah, those videos are amazing.
Ashok Elluswamy: Yeah, they're putting it to real test. I mean, they're dark roads.
Elon Musk: Frankly, I think the Chinese consumer might be the most [American] (ph) consumer and, I actually, our customers in China are awesome. They have a lot of fun with the cars. I saw one guy take a Tesla on -- autonomous on a narrow road across like a mountain. And I'm like, very brave person. And the Tesla's driving along on a road with no barriers where he makes a mistake, he's going to plunge to his doom. But it worked.
Travis Axelrod: Great. Thank you. And the question was on Cybercab itself, we're in B sample validation now.
Elon Musk: Yeah, we should ask that question too. |
7,081 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yeah, we should ask that question too.
Travis Axelrod: Yeah, we have our first big builds coming at the end of this quarter in Q2. And then in the coming months, we start to large scale installation of all the equipment in Giga Texas with still on schedule for production next year.
Travis Axelrod: Yeah. And I just want to also to clarify because I think people don't understand the thing that there's no new building being built and where is Cybercab going to -- literally the same factory.
Lars Moravy: It's happening and people don't know it’s just happening upstairs all the long lines while we're still building the Model Ys and Cybertrucks every day.
Elon Musk: Yeah. So it's worth noting that the Tesla Gigafactory at Austin is three times the size of the Pentagon.
Lars Moravy: Including the garden.
Elon Musk: Yeah, including the ground zero garden. And I’d go visit Pentagon like, this building used to look big, but then you won’t.
Travis Axelrod: Great. Thank you very much. The next question is, when will FSD Unsupervised be available for personal use on personally-owned cars? |
7,082 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Before the end of this year. Not necessarily -- I say within the US, like we do want to test -- at Tesla, we're absolutely hardcore about safety. We go to great lengths to make the safest car in the world and have the lowest accidents per mile in. So -- and look, fewest lives lost. So we want to be very careful. So we want autonomy to be definitively safer than manual driving. So it's not enough that it just be as safe. It needs to be meaningfully safer than if it's cars mainly driven. And we want to confirm that there's not something -- we just want to be cautious with the rollout. We don't want to jump in at the deep end with an army. So with that said, I think we should -- people should -- we should be able to have it work in several cities later this year for personal use. So the acid test being you should be able to -- can you go to sleep in your car and wait until your destination? And I'm confident that it will be available in many cities in the US by the end of this year.
Travis Axelrod: Great. Thank you very much. The next question is, is Tesla still on track for releasing more affordable models this year? Or will you be focusing on simplifying versions to enhance affordability similar to the rear-wheel drive Cybertruck? |
7,083 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Yeah, we're still planning to release models this year. As with all launches, we're working through like the last-minute issues that pop up. We're not getting down one by one. At this point, I would say that ramp maybe -- might be a little slower than we had hoped initially, but there's nothing, just kind of given the turmoil that exists in the industry right now. But there's nothing blocking us from starting production within the next -- within the timeline laid out in the opening remarks. And I will say, it's important to emphasize that as we've said all along, the full utilization of our factories is the primary goal for these new products. And so flexibility of what we can do within the form factor and the design of it is really limited to what we can do in our existing lines rather than build new ones. But we've been targeting the low cost of ownership. Monthly payment is the biggest differentiator for our vehicles. And that's why we're focused on bringing these new models with the big, new lowest price to the market within the constraints of selling.
Travis Axelrod: Great. Thank you very much. The next question is, does Tesla see robotaxi as a winner-take-most market? And as you approach the Austin launch, how do you expect to compare against Waymo's offering, especially regarding pricing, geofencing and regulatory flexibility? |
7,084 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Well, okay. The issue with Waymo's cars is it costs way more money, but that is the issue. The car is very expensive, made in low volume. Teslas are probably cost 25% or 20% of what a Waymo costs and made in very high volume. So, ironically, like, we’re the ones to make the bet that a pure AI solution with cameras and what do you have? The car actually will listen for sirens and that kind of thing. It's the right move. And Waymo decided that an expensive sensor suite is the way to go, even though Google is very good at AI. So I'm wondering. And it is worth noting that Tesla has both an incredible AI software team and AI hardware chip design team, prospect [indiscernible]. So yeah, it's really -- I mean, I don't see anyone being able to compete with Tesla at present. I'm sure that'll change eventually, but at least as far as I'm aware, because we will have, I don't know, 99% market share or something ridiculous. That 90-something-percent, at least, I don't know, some of them might change, but if we have millions of cars deployed next year unless others have millions of cars deployed, like, we'll have -- unless we're blocked by regulatory situations, it won't be long. I mean, in a few years, we'll have 10 million autonomous cars on the roads and counting.
Ashok Elluswamy: The other thing which people forget is like we're not just developing the software solution, we are also manufacturing the cars. And like, Waymo has, they're taking cars and then trying to put...
Elon Musk: Waymo in it.
Ashok Elluswamy: We don't do that, so that definitely gives us a big leg-up. And like Elon said, we only have a big existing fleet which hopefully, with a software update could become autonomous.
Elon Musk: With software update, it will become autonomous. To be clear, the Model Y that we are talking about in being autonomous in Austin in June are the Model Ys we make currently, there's no change to it.
Ashok Elluswamy: I think people don't appreciate that the car they can buy today...
Elon Musk: The car that they have. |
7,085 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Ashok Elluswamy: I think people don't appreciate that the car they can buy today...
Elon Musk: The car that they have.
Ashok Elluswamy: Are the car they have is capable of these kind of things.
Vaibhav Taneja: In fact, it does drive autonomously from the factory to the end of line, every car nowadays.
Lars Moravy: That runs through the tunnel, the Model Y is everything.
Elon Musk: Right. Yes, exactly. We have -- it has been pointed to use -- it's doing useful work fully autonomously at the factories as Ashok was mentioning. The car is driving itself from end of line to where it was supposed to be picked up by a truck to be taken to a customer. And I'm confident also that later this year, the first Model Y will drive itself all the way to the customer. So, from our -- probably from our factory in Austin and one in here in Fremont, California, I'm confident that from both factories, we'll be able to drive directly to a customer on the factory.
Lars Moravy: Cool delivery.
Elon Musk: Yeah, literally goes from the end of line and drive themselves to your house.
Lars Moravy: It's important to note in the factories, we don't have dedicated lengths or anything. People are coming out every day, trucks delivering supplies, parts, construction.
Elon Musk: And people can film it. By the way, you can see this from the road. Like, it’s not covered. And there’s many people take videos online. And anyone who wants to see it and just drive past our Fremont factory and see the autonomous cars driving themselves. And they drive themselves and they put themselves in the exact right spot to be picked up.
Lars Moravy: Yeah, the logistics yard is right there in the open. We don't move it again to another lane.
Elon Musk: They go to a specific spot, parking spot. Yeah. So that's just a routine like everyday thing now.
Travis Axelrod: Great. Thank you very much. The next question is, can you please provide an update on the unboxed method and how that has progressed? |
7,086 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Sure. It's progressing, absolutely. As I mentioned just a minute ago, like it is the basis for our Cybercab manufacturing process. It's really what we changed in order to allow the low cost of production and also get the super high levels of automation. Really, levels of automation that are sort of unheard of in the vehicle manufacturing scale. This is like not something that when you see it be produced, you'll think of in terms of, like, wow, this car has been built for 100 years. It's really something we’ve changed. In the past year, we've been like focusing on a lot of key development areas like, marrying these large subassemblies together in a precise way, in an accurate way. We've also derisked things like corrosion of uncoated aluminum structures, the ceiling across the seams of the vehicle and when you marry several components. And we've even done early crash testing and improvement that like it's going to be just as safe as the other car we build. So like we're -- as with all that combined, we kind of go into the builds that we have in this quarter for the Cybercab product, and that's the next real big test of full-scale integration with the unboxed process. And that's kind of where we are. So you'll see them on the test roads in a couple of months.
Elon Musk: Yeah. Although the line won't be at this rate…
Lars Moravy: Initially.
Elon Musk: Initially, this is a revolutionary production system. I’m not sure what the right word is. Unboxing sounds like something when you get your phone.
Lars Moravy: And you open it up. |
7,087 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: And you open it up.
Elon Musk: You have like a pleasant experience when you take your phone out of the box, which of course is nice, but this is more revolutionary than that. This is a profound reimagining of how to make cars in the first place. No car is made like this anywhere in the world. The factory is the product as much as the car is the product. So, this really is the first principles approach to manufacturing that will ultimately allow us, I think, to -- I’m trying to think, I'm confident, ultimately allow us to achieve a cycle time, meaning a unit every five seconds or less, off a single line.
Ashok Elluswamy: And we want to incorporate some of these for testing into our existing production lines as well with the Cybertruck already.
Elon Musk: I mean, this is something I've been thinking about for a long time and sort of thinking about this a long time, and it's kind of -- it's not a crazy thing. Like a car every five seconds may sound like it's coming out like bullets, but actually it's coming out at walking speed.
Ashok Elluswamy: It's a meter a second.
Elon Musk: A meter a second. So this is like we're still far away from caring about the ergonomic drag of the manufacturing line because you're still at 3 miles an hour. Every five second sounds crazy but it's 3 miles an hour that we're talking about. So yeah, you can run away from it basically. But that's still, by far, and fastest line on Earth, and it's like half hour make, [indiscernible]
Lars Moravy: Shanghai phase 2. 33 seconds.
Elon Musk: We're the fastest, right?
Lars Moravy: I would think so. |
7,088 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Shanghai phase 2. 33 seconds.
Elon Musk: We're the fastest, right?
Lars Moravy: I would think so.
Elon Musk: We think we're the fastest at 33 seconds in our Shanghai factory, but this would be six times faster or seven times faster, thereabouts. I mean, it'll be slower than that but the point is that like when you fully optimize the design and you’ve got operation of the next-generation factory that we're building right now, the 5-second cycle time or less is, the design is capable of it. So if you -- when you go through like new architecture, you go from like being like in any -- I mean, probably China in particular is an A+ on a moderately, an advanced but still traditional car production system. So they're really in about as good as possible to do within in a conventional scenario. So trying to get much below, sort of below like 30 seconds, extremely difficult. But, and you start getting into sort of impossible where you just -- you have to be faster than a human could possibly move. So then the autonomous line, it really just needs to be robust moving really fast, and that's where you get to sub-5 seconds. But we'll start off with getting a C and a new architecture, but then the potential is there over time to move them up to an A+, within an A+ architecture.
Travis Axelrod: Great. Thank you very much. The next question is, how is Tesla positioning itself to flexibly adapt to global economic risks and form of tariffs, political biases, et cetera? |
7,089 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Vaibhav Taneja: As Elon said, we've been [indiscernible] team for a while. We continue to mitigate global economic risks like tariffs and political biases by regionalizing part supply factories in North America, Berlin and Shanghai. For example, in North America, our high-volume vehicle programs have over 85% North America content and Shanghai vehicles have over 95% local content. Berlin has similar levels of regionalization as North American when you exclude the battery, and we are working on regionalizing the battery as well. This is a pre-pandemic strategy that we accelerated post pandemic through supply diversification, dual-sourcing, vertical integration, advanced analytics, and local partnerships to ensure supply chain resilience and production stability. Having said that, we are not 100% insulated and these tariffs rates are higher on our low volume platforms than the high-volume ones.
Elon Musk: Yeah. There's no more vertically integrated car company than Tesla. I mean, we're taking -- we're most vertically integrated car company since Henry Ford back in the day when they're doing mining iron and stuff and growing rubber trees. Like we're not growing rubber trees and mining iron yet. But we are -- we have both a lithium refinery in South Texas. And it's -- I mean, the biggest lithium refinery outside of China, I think. Is that right?
Unidentified Company Representative: Yeah. I think so. |
7,090 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Unidentified Company Representative: Yeah. I think so.
Elon Musk: But it has -- its upward potential would be the biggest lithium refinery outside -- and we've got to expand and build more, right. And then we've got the catheter refinery in Austin next to Gigafactory. We've got to figure out what to do about the anode. This is an ongoing subject of discussion. The best of all possible would be figuring how to have no anode. Best part being no part. That's the dream of the lithium batteries to be not having anode. But either way, we better have the anode, the cathode and the lithium and the electrolytes, separator to make a cell. But there's no other car company that has both lithium refineries and cathode refineries. We're ridiculously vertically integrated, and thus are best positioned to protect against supply chain disruptions. You want to talk that progress?
Unidentified Company Representative: Yeah. Certainly, for our in-house cells, we've multi-sourced every component. We have every path coming from at least two different countries of origin, which is we started this -- the supply chain team and the engineering team worked together on this for the last couple of years to put that together. It's not something we did in a couple of months. This is years of work. So we're in a good position to take advantage of that and the in-sourcing of lithium and cathode, the two most critical parts that actually does run that backyard and we're totally insulated from.
Elon Musk: I think it need to be an operation.
Unidentified Company Representative: I think it need to be an operation. |
7,091 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I think it need to be an operation.
Unidentified Company Representative: I think it need to be an operation.
Elon Musk: We also make our own cells by the way. Cell production, if you took this -- you make the anode, the cathode, the lithium, the electrolyte separator, can and then you got to put all that together in the cell factory and there are entire companies that only do is produce cells but they don't do the other stuff, refine lithium or the cathode or. So, our cell production is going quite well. And I think we're, we’re a company sort of the lowest cost per kilowatt hour.
Unidentified Company Representative: All cells we purchase in North America.
Elon Musk: Yeah. So we have the lowest cost per kilowatt hour, all things considered. So the Tesla cell is the most competitive cell. Yeah, for a kilowatt hour bringing to a car, it's a Tesla cell, it's lower cost than a supplier cell.
Unidentified Company Representative: Yes. And the plan this year is to really build off that base. Getting to lowest cost is, it's the hardest challenge for so many entry. It's relatively easy to build a flashy product that does one thing well. To build something at high volume, low cost is super difficult, and we're kind of using that space to let go off and add performance in different areas for new products coming out. |
7,092 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Lars Moravy: Yeah. I mean, to Elon's point, there's a lot of advantages for regionalization. The most important thing is we're maximizing the working capital for six to eight weeks on the ocean. If there's a design change, then everything that's in transit basically has to be scrapped. Secondly, port disruptions, as we saw during COVID, can be very expensive because slide disconnects can shut down production. So then your only option is costly expedite. It also gives us resilience in supply chain. If one region is down, we can bridge with others. It's more to set up in the beginning, but it's critical to have when the need arises. Having said that, it's unrealistic there's 100% regionalization across the board for specialized areas such as semiconductors. In such cases, our teams works very closely with our partners to ensure we have strategic banks in place and disruption doesn't impact production while we stand up the regional manufacturing for that particular commodity.
Unidentified Company Representative: And I'll say like unless the vehicle, like Elon was talking about with cells, we’re also heavily integrated, important ingots, internal castings, we recycle those and melt some. There's the same thing with plastics, but it doesn't mean we're not exposed. We do have some areas where we use magnets and we've been working for years to find alternative sources and bring those up as well as we have machines. And as we've mentioned in the past, we're working on ferrite numbers for some time. So like, as Karn said, with our heavy regionalization percentages, we definitely like the lowest exposed to this, but we're not completely immune as Vaibhav mentioned.
Travis Axelrod: Great. Similarly related on the battery side. Is Tesla still battery supply constrained as noted on the Q4 call and does that change with tariffs? |
7,093 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Karn Budhiraj: This is Karn. We've been working very hard to expand battery cell production in the US, both with vendors and what Bonnie mentioned earlier with the 4680 program. And we're also working on moving the upstream supply chain for battery cells to the United States for several years. And that strategy is really starting to pay off now. As it stands right now, we're not constrained on battery cell supply for vehicles. The recent tariffs do pose some challenges to Tesla Energy, well, like our CFO mentioned earlier, but it's something we've been anticipating and we should be able to resolve in a timely fashion. We actually have a kind of place right going towards it. We also have some other sources coming online to supplement the shortfall. And then of course, we have the production that's happening in-house. We have a slight disconnect of aligning the right cells with the right path. So that's the little bit of puzzle that we have to solve internally. But as far as cells go, there's no shortage.
Travis Axelrod: Great. Thank you very much. The next question is, did Tesla experience any meaningful changes in order inflow rate in Q1 relating to all the rumors of brand damage?
Unidentified Company Representative: In Q1, as I mentioned earlier, we took the best-selling car over the last two years and ramped up all four of our global factories. And in less than eight weeks, we've already gone to the rate of our previous Model Ys in the factories. So, just kudos again to the team for the great job there. And despite the economic strain and negative articles, in California in Q1, Tesla remained the best-selling car, not just EV. And additionally, we had a record number of test drives globally in Q1 as well. So, interest remains high. And so right now, we continue to see good interest still on vehicle. |
7,094 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yeah. I mean, Tesla is immune to sort of the macro demand for cars. So when there is economic uncertainty, people generally want to pause on buying, doing a major capital purchase like a car. But as far as absent macro issues, we don't see any reduction in demand.
Unidentified Company Representative: Correct. And that's what we're continuing to focus on affordability. And it's fun to focus there.
Travis Axelrod: Fantastic. Thank you guys. The next question is regarding the Tesla Optimus pilot line, could you confirm if it is currently operational? If so, what is the current production rate of Optimus bots per week? Additionally, how might the recent tariffs impact the scalability of this production line moving forward? |
7,095 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: I want to emphasize Optimus is still very much a development program. It's not a large volume production. This year, we'll make a few -- we do expect to make thousands of Optimus robots, but most of that production is going to be at the end of the year. So the -- almost everything in Optimus is new. There's not like an existing supply chain for the motors, gearboxes, electronics, actuators, really anything in the Optimus apart from the AI for Tesla -- Tesla AI computer, which is the same as the one in the car. So when you have a new complex manufactured product, it will move as fast as the slowest and least lucky component in the entire thing. And as opposed to proximation, there's like 10,000 unique things. So, that's why anyone who tells you they can predict with precision the production ramp of the truly new product is -- doesn't know what they're talking about. It is totally impossible. So, you go through this like a series of constraints where I would think this part is a limiting factor, now that part is a limiting factor, and this part is a limiting factor and multiply that by 1,000 basically. And then the rate of the production is decided by how quickly you can solve each of those problems. Now, Optimus was affected by the magnet issue from China because the Optimus actuators in the arm do use permanent magnets. Now Tesla as a whole is not me to use permanent magnets. But when something is volume constrained, like an arm of the robot, then you want to try to make the motors as small as possible. And then so we did the design in permanent magnets for those motors, and those were affected by the supply chain, by basically China requiring an export license to send out anywhere with magnets. So, we’re working through that with China. Hopefully, we’ll get a license to use the rare earth magnets. China wants some assurances that these are not used for military purposes, which, obviously, they’re not. They’re just going into a humanoid robot. So that’s not a weapon system. But that that is certainly |
7,096 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | obviously, they’re not. They’re just going into a humanoid robot. So that’s not a weapon system. But that that is certainly an example of a challenge there. But I’m confident we’ll overcome these issues, and we’ll, by the end of this year, have thousands of populous robots. |
7,097 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Travis Axelrod: Great. Thank you very much. And the last question, we already covered earlier, whether Robotaxi was still on track for this year. So, with that, we can move on to analyst questions. The first question is going to come from Pierre at New Street. Pierre, please unmute yourself.
Pierre Ferragu: Hey, guys. Can you hear me?
Elon Musk: Yeah.
Pierre Ferragu: That's great. I'm super excited to hear robotaxi and Optimus becoming the very tangible future for Tesla. But I have actually a question on the legacy, not legacy, in the current like auto business. And when I look back to the ramp of Model 3 a few years ago, I really saw it as being the iPhone of cars, a new product, completely reinvented, very different user experience, vastly superior, impossible to match for traditional competitors. And for the iPhone, which resulted in the high end of the smartphone market quadrupling in size and actually Apple taking 60% market share. And so when you look at the Model 3 and the Model Y today, I think they are still actually vastly superior to any other cars. And I wonder why they've taken about 15% of their addressable market and not more actually? So, another way to put it is, why are there so many people still buying BMWs and Mercedes, knowing that Model 3 and the Model Ys are out there and available? And I wonder if you're trying to solve that internally. If you understand why -- what are these auto buyers buying a Model 3 or Model Y missing? And if you have ideas of things you could do to address that, maybe there is enormous value left on the table there. Yeah, that's what I'm wondering these days. |
7,098 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Elon Musk: Yeah. The reality is that, in the future, most people are not going to buy cars. So it’s kind of what, one could sort of say, look, if you think one to continue with your phone metaphor, I mean, you can remember the days of the flip phones when there was a hundred different flip phone designs. And I would, the mistake that lump manufacturers made was to try to make that many different variants of a flip bone, but which was a mistake. They should have made the iPhone. So, because obviously everyone’s going to want a smartphone. But in the beginning of when the iPhone came out, I was like, wow, I can’t believe these guys are not reacting as though this is death. But they didn’t, they kept making the variants of smartphones. Nokia, I think, at one point was the most valuable company in the world or close to it, but they kept making flip phones. Trying to find another market niche. Maybe somebody wants a phone of a different style, maybe this different color or whatever it is. Nope. They just want a super intelligent phone that can do everything. Just one. So I said this many years ago. But in the in the future, in the not too distant future, buying a gasoline car that is not autonomous will be like riding a horse while using a flip phone. Some people still do it, but it’s rare.
Travis Axelrod: Great. Thank you. The next question comes from Emmanuel Rosner at Wolfe. Emmanuel, please unmute yourself.
Emmanuel Rosner: So, Elon, the public version of the FSD software still has a decent amount of, I guess, intermittent human interventions that are required. So, what’s still required for the software on your end to get to a level where it doesn’t need to be supervised? And I’m asking that in the context of, obviously, the June launch being in the next couple of months. What still needs to happen?
Unidentified Company Representative: We’re working on a number of items too.
Elon Musk: Go ahead. |
7,099 | TSLA | 1 | 2,025 | 2025-04-22 17:30:00 | Tesla, Inc. | 27,444,752 | Unidentified Company Representative: We’re working on a number of items too.
Elon Musk: Go ahead.
Unidentified Company Representative: I mean, we are aware of the interventions that are happening in public bus, and that’s why we are hardcore burning it down. And really speaking, some initial launch city helped us focus on, like, solving all the issues that we face here. For example, like, we’re just focusing on Austin. We’re not, like, solving all the issues that customers in Boston or somewhere else might face. And then here, we just, like, have big list of all the issues, just burn it down, and that’s what the team is working on along with other sort of, like, redundancy issues. For example, if one of the computers goes down, right down the customer fleet, it would, like, throw the red hands and ask you to take over, but we don’t want that kind of situation. So you’re solving both, like, the reliability issues of the autonomy software and also the reliability issues of the system software, like, together for Austin.
Elon Musk: Yeah. It really just we just worked through a long tail of unusual interventions. So, and these are really very rare. Like, as a single intervention every 10,000 miles. I mean, that’s a lot of driving you got to do to even find one case within Athens.
Unidentified Company Representative: Yeah. And some interventions that have been due to systematic, like, missing functionality. For example, for handling emergency vehicles correctly, you don’t need to con consume audio as an input. But then the customer facing versions don’t have audio input, but the version that’s in -- that’s going to be in Austin will have audio input and so on.
Emmanuel Rosner: Okay. But would you have, like, remote operators, for example? |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.