Connect with us

News

Tesla posts ‘first positive surprise of year’ as Morgan Stanley breaks down Q2

Published

on

Tesla posted what Morgan Stanley called its “first positive surprise of the year” as it beat delivery expectations for Q2 by around 6,000 units.

On Tuesday, Tesla reported its quarterly deliveries at 443,956, beating what Wall Street expected with its consensus figures at 438,019.

Tesla reports Q2 delivery and production figures, beating estimates

The beat was a big step in the right direction for Tesla, which has struggled to post any positive news so far in 2024 in terms of the grand scale. The automaker has struggled with growth, an expected bottleneck in its trek for EV sector domination as it finds itself in between two growth periods.

However, the Q2 numbers were labeled the “first positive surprise of the year” by Morgan Stanley analyst Adam Jonas, who said there were a few things to be happy about.

Advertisement

Delivery Beat

Tesla beat delivery expectations, but there is still a long way to go before bulls can truly be pleased with what they see. Although they increased deliveries quarter-over-quarter, the Q2 figures are lower than what Tesla reported in Q2 last year.

In order to keep things flat in terms of the annual growth rate and report 0 percent instead of a loss, Tesla will need to grow deliveries in the second half of next year by roughly 6 percent.

Inventory Reduction

Tesla delivered 33,000 more units than it produced, which means its inventory is starting to thin out.

This is a good thing from a consumer perspective because, in theory, it means that Tesla cannot keep up with consumer interest. It basically means demand for its vehicles is healthy, and people are willing to buy an inventory vehicle.

Jonas writes:

Advertisement

“Tesla delivered 33k units more than it produced in 2Q, driving a 7-day reduction in days’ supply of inventory (on a full calendar day basis) in the quarter. The 2Q inventory reduction substantially (but not fully) offsets the incresae in inventory seen in 1Q. At an ATP of $45k/unit this, by itself, drives a $1.5bn working capital inflow during the quarter — higher than the $600mm tailwind we have expected. Our 2Q forecast for $0.9bn FCF burn looks incrementally more conservative following this print.”

Energy Storage Deployments

Perhaps the biggest piece of information from the delivery report had nothing to do with cars in the slightest.

Tesla reported that it deployed 9.4 GWh of energy storage products in Q2, its biggest in history by a wide margin.

This was a 132 percent increase from Q1 2024, which was previously its largest deployment. Tesla rolled out 4.053 GWh of energy during this three-month span.

Tesla Energy posts record 9.4 GWh of battery storage deployed in Q2 2024

Advertisement

Jonas said the news was a “show stealer” and was nearly two-times what Morgan Stanley predicted for the calendar year.

The firm believes this could be something Tesla investors should pay attention to in the coming months:

“As Gen AI acceleration spurs a multigenerational increase in energy demand, electricity generation, and data center investment, we believe investors will begin to pay more attention to Tesla Energy, which we value at $36 per Tesla share ($130bn) as the business uniquely positioned to benefit from investment in the U.S. electric grid accelerated by the AI boom.”

Tesla Mojo

Jonas said that two weeks ago, clients were preparing for a rejection in ratification of Musk’s 2018 pay package. Now, they’re asking about “positive catalysts for 2Q and beyond.”

Investors were also asked this interesting question:

Advertisement

“Is this the same Tesla from early June?”

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on X @KlenderJoey. If you're looking for great Tesla accessories, check out shop.teslarati.com

Comments

News

Tesla rolls out most aggressive Model Y lease deal in the US yet

With the promotion in place, customers would be able to take home a Model Y at a very low cost.

Published

on

(Credit: Tesla)

Tesla has rolled out what could very well be its most aggressive promotion for Model Y leases in the United States yet. With the promotion in place, customers would be able to take home a Model Y at a very low cost.

Zero downpayment leases

The new Model Y lease promotion was initially reported on X, with industry watcher Sawyer Merritt stating that while the vehicles’ monthly payments are still similar to before, the cars can now be ordered with a $0 downpayment. 

Tesla community members noted that this promotion would cut the full payment cost of Model Y leases by several thousand dollars, though prices were still a bit better when the $7,500 federal tax credit was still in effect. Despite this, a $0 downpayment would likely be appreciated by customers, as it lowers the entry point to the Tesla ecosystem by a notable margin.

Premium freebies included

Apart from a $0 downpayment, customers of Model Y leases are also provided one free upgrade for their vehicles. These upgrades could be premium paint, such as Pearl White Multi-Coat, Deep Blue Metallic, Diamond Black, Quicksilver or Ultra Red, or 20″ Helix 2.0 Wheels. Customers could also opt for a White Interior or a Tow Hitch free of charge.

A look at Tesla’s Model Y order page shows that the promotion is available for all the Model Y Premium Rear-Wheel Drive and the Model Y Premium All-Wheel Drive. The Model Y Standard and the Model Y Performance are not eligible for the $0 downpayment or free premium upgrade promotion as of writing. 

Advertisement
@teslarati 🚨 Tesla Full Self-Driving v14.1.7 is here and here’s some things it did extremely well! #tesla #teslafsd #fullselfdriving ♬ You Have It – Marscott
Continue Reading

News

Tesla is looking to phase out China-made parts at US factories: report

Tesla has reportedly swapped out several China-made components already, aiming to complete the transition within the next two years.

Published

on

tesla-full-self-driving-unsupervised
(Source: Tesla)

Tesla has reportedly started directing its suppliers to eliminate China-made components from vehicles built in the United States. This would make Tesla’s US-produced vehicles even more American-made.

The update was initially reported by The Wall Street Journal.

Accelerating North American sourcing

As per the WSJ report, the shift reportedly came amidst escalating tariff uncertainties between Washington and Beijing. Citing people reportedly familiar with the matter, the publication claimed that Tesla has already swapped out several China-made components, aiming to complete the transition within the next two years. The publication also claimed that Tesla has been reducing its reliance on China-based suppliers since the pandemic disrupted supply chains.

The company has quietly increased North American sourcing over the past two years as tariff concerns have intensified. If accurate, Tesla would likely end up with vehicles that are even more locally sourced than they are today. It would remain to be seen, however, if a change in suppliers for its US-made vehicles would result in price adjustments for cars like the Model 3 and Model Y.

Industry-wide reassessments

Tesla is not alone in reevaluating its dependence on China. Auto executives across the automotive industry have been in rapid-response mode amid shifting trade policies, chip supply anxiety, and concerns over rare-earth materials. Fluctuating tariffs between the United States and China during President Donald Trump’s current term have made pricing strategies quite unpredictable as well, as noted in a Reuters report. 

Advertisement

General Motors this week issued a similar directive to thousands of suppliers, instructing them to remove China-origin components from their supply chains. The same is true for Stellantis, which also announced earlier this year that it was implementing several strategies to avoid tariffs that were placed by the Trump administration. 

@teslarati 🚨 Tesla Full Self-Driving v14.1.7 is here and here’s some things it did extremely well! #tesla #teslafsd #fullselfdriving ♬ You Have It – Marscott
Continue Reading

News

Tesla owners propose interesting theory about Apple CarPlay and EV tax credit

“100%. It’s needed for sales because for many prospective buyers, CarPlay is a nonnegotiable must-have. If they knew how good the Tesla UI is, they wouldn’t think they need CarPlay,” one owner said.

Published

on

apple-music-tesla-demo
Credit: Tesla Raj/YouTube

Tesla is reportedly bracing for the integration of Apple’s well-known iOS automotive platform, CarPlay, into its vehicles after the company had avoided it for years.

However, now that it’s here, owners are more than clear that they do not want it, and they have their theories about why it’s on its way. Some believe it might have to do with the EV tax credit, or rather, the loss of it.

Owners are more interested in why Tesla is doing this now, especially considering that so many have been outspoken about the fact that they would not use it in favor of the company’s user interface (UI), which is extremely well done.

After Bloomberg reported that Tesla was working on Apple CarPlay integration, the reactions immediately started pouring in. From my perspective, having used both Apple CarPlay in two previous vehicles and going to Tesla’s in-house UI in my Model Y, both platforms definitely have their advantages.

However, Tesla’s UI just works with its vehicles, as it is intuitive and well-engineered for its cars specifically. Apple CarPlay was always good, but it was buggy at times, which could be attributed to the vehicle and not the software, and not as user-friendly, but that is subjective.

Nevertheless, upon the release of Bloomberg’s report, people immediately challenged the need for it:

Some fans proposed an interesting point: What if Tesla is using CarPlay as a counter to losing the $7,500 EV tax credit? Perhaps it is an interesting way to attract customers who have not owned a Tesla before but are more interested in having a vehicle equipped with CarPlay?

“100%. It’s needed for sales because for many prospective buyers, CarPlay is a nonnegotiable must-have. If they knew how good the Tesla UI is, they wouldn’t think they need CarPlay,” one owner said.

Tesla has made a handful of moves to attract people to its cars after losing the tax credit. This could be a small but potentially mighty strategy that will pull some carbuyers to Tesla, especially now that the Apple CarPlay box is checked.

@teslarati :rotating_light: This is why you need to use off-peak rates at Tesla Superchargers! #tesla #evcharging #fyp ♬ Blue Moon – Muspace Lofi

Continue Reading

Trending