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"No Demand Problem": Musk Doubles Down On Whoppers During Tesla Meeting
06-12-2019, 08:06 AM,
#1
"No Demand Problem": Musk Doubles Down On Whoppers During Tesla Meeting
"No Demand Problem": Musk Doubles Down On Whoppers During Tesla Meeting

<p>Just weeks ahead of having to <s>face reality</s> report his company's Q2 numbers, Elon Musk went on the record yesterday during Tesla's annual general meeting and told the world that there was "not a demand problem" for Tesla vehicles, according to <a href="https://arstechnica.com/cars/2019/06/at-tesla-shareholder-meeting-musk-assures-there-is-not-a-demand-problem/">ARS Technica</a>. </p>

<p>As a reminder, this is the same CEO that once promised profitable quarters going forward from Q2 2018 - and who just posted a more than $700 million loss to start off 2019. But the market <em>once again</em> appeared to take Musk's <s>pump</s> guidance at its word, and Tesla stock shot up in Tuesday's after-hours session and Wednesday's pre-market session.</p>

<p> </p>

<p><a data-image-external-href="" data-image-href="/s3/files/inline-images/ramp.png?itok=7QgRsh87" data-link-option="0" href="https://www.zerohedge.com/s3/files/inline-images/ramp.png?itok=7QgRsh87"><picture><!--[if IE 9]><video style="display: none;"><![endif]--><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/ramp.png?itok=jpSs56Aa 1x" media="all and (min-width: 1280px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/ramp.png?itok=jpSs56Aa 1x" media="all and (min-width: 480px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/ramp.png?itok=jpSs56Aa 1x, https://zh-prod-1cc738ca-7d3b-4a72-b792-...k=jpSs56Aa 2x" media="all and (min-width: 1024px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/ramp.png?itok=jpSs56Aa 1x" media="all and (min-width: 768px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_mobile/public/inline-images/ramp.png?itok=7QgRsh87 1x" type="image/png"></source><!--[if IE 9]></video><![endif]--><img data-entity-type="file" data-entity-uuid="66f05d42-100e-4dba-a9e9-c91488c2989e" data-responsive-image-style="inline_images" height="282" width="500" src="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/inline-images/ramp.png" alt="" typeof="foaf:Image" /></picture></a></p>

<p>In his initial statement to the audience, Musk reiterated what he said in a conveniently leaked email weeks ago: that there was a chance that Q2 2019 could be a "record quarter". </p>

<p>Musk said: "I want to be clear that there is not a demand problem... Sales have far exceeded production, and production has been pretty good.<strong> We have a decent shot at a record quarter... if not, it's going to be very close.</strong>"</p>

<p>But when asked about profitability, a metric that Musk had already guided for on a consistent basis, his tone was less optimistic. He said: <strong>"Profitability is always challenging when you're a fast-growing company</strong>. Last year, we doubled our fleet. It's hard to be profitable for that level of growth."</p>

<p>And then, as if to fulfill some double-talk requirement, Musk added: "I think we can be cash-flow positive despite having a very fast growth rate." </p>

<p>For good measure, he then pivoted to telling the audience he didn't think it would "be long before we have a 400-mile-range car."</p>

<p>Musk then continued, discussing battery availability and full self driving. As a reminder, Consumer Reports <a href="https://www.zerohedge.com/news/2019-05-22/far-less-competent-human-consumer-reports-slams-teslas-autopilot">called</a> the latest version of Autopilot "less competent than a human." At the general meeting, Musk more than likely did the right thing by not promising any specific dates and timelines for full-self driving, but he did reiterate that the feature "should be able to go from your garage to your parking space at work" without assistance.</p>

<p>He told the audience that <em>his </em>prototype for FSD could "can take me from my house to the office." </p>

<p>But then Musk admitted that there were ongoing challenges with perfecting the "summon" feature that is supposed to allow your car to find its way to you autonomously in a parking lot.</p>

<p><a data-image-external-href="" data-image-href="/s3/files/inline-images/mining.png?itok=qFYX-HO0" data-link-option="0" href="https://www.zerohedge.com/s3/files/inline-images/mining.png?itok=qFYX-HO0"><picture><!--[if IE 9]><video style="display: none;"><![endif]--><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/mining.png?itok=ucaGJK26 1x" media="all and (min-width: 1280px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/mining.png?itok=ucaGJK26 1x" media="all and (min-width: 480px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/mining.png?itok=ucaGJK26 1x, https://zh-prod-1cc738ca-7d3b-4a72-b792-...k=ucaGJK26 2x" media="all and (min-width: 1024px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/mining.png?itok=ucaGJK26 1x" media="all and (min-width: 768px)" type="image/png"></source><source srcset="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_mobile/public/inline-images/mining.png?itok=qFYX-HO0 1x" type="image/png"></source><!--[if IE 9]></video><![endif]--><img data-entity-type="file" data-entity-uuid="e03c350d-eb25-4d63-b374-9ce33e3abfbb" data-responsive-image-style="inline_images" height="277" width="500" src="https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/inline-images/mining.png" alt="" typeof="foaf:Image" /></picture></a></p>

<p>Musk also said at the meeting that one of the primary constraints for the company was availability of batteries. But how to solve that issue?<strong> Get into the mining business, of course, Musk said. </strong>Robotaxis are <em>so last month.</em></p>

<p>Musk said: <strong>"We might get into the mining business, I don't know</strong>—we'll do whatever we have to make sure we can scale at the fastest rate possible."</p>

<p>Finally, Musk commented that he expects demand for the Model Y to eventually be greater than the S, the X, and the 3 combined. This stands at odds with Morgan Stanely's Adam Jonas, <a href="https://www.zerohedge.com/news/2019-05-22/morgan-stanley-wednesday-call-tesla-now-distressed-credit-and-restructuring-story">who dryly said</a> on an investor call last month that <strong>"nobody cares about the Model Y".  </strong></p>

<p>Musk was once again incoherent when trying to pin down a timeline for the Model Y: "We expect to hit volume production towards the end of next year," he said, before saying, "internally, we're shooting for sooner than that."</p>

<p>Finally, Musk made two more pivots. First, telling the crowd he hoped to announce a pick-up truck sometime this summer. And second, that the solar roof tiles that investors were promised years ago and has yet to materialize is currently on "full version three" - <em>whatever the hell that means</em> - and that, when finished, it would last 30 years, would be easy to install, and would be low cost.</p><img src="http://feeds.feedburner.com/~r/zerohedge/feed/~4/tuxRTjBUxO0" height="1" width="1" alt=""/>


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