Tesla investor day: Elon Musk disappointed by masterplan, affordable EV


Tesla Inc will slash assembly costs in half for future generations of vehicles, engineers told investors on Wednesday, but Chief Executive Elon Musk is holding back on a long-awaited small, affordable electric car. Shares were down more than 5 percent in after-hours trading after the presentation at the company’s investor day at its Texas headquarters. The question-and-answer program is continuing.

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Updated on:
March 2, 2023 at 08:18 am

Tesla Chief Executive Elon Musk is expected to share key details about the electric automaker's upcoming affordable electric car during its investor day event on March 1.  (File photo) (Reuters)
Tesla Chief Executive Elon Musk is expected to share key details about the electric carmaker’s forthcoming affordable electric vehicle at its investor day event on March 1. (file photo) (Reuters)

During the first three hours of the webcast, Tesla executives led by Musk discussed everything from a white paper plan for a global embrace of sustainable energy to the company’s innovations in managing operations from manufacturing to service.

The presentation featured a series of engineers, a nod to Tesla’s attempt to show the depth of its executive seat beyond the face of the company, Musk. The new head of global production, Tom Zhu, took the stage and said that Tesla’s global production capacity is 2 million vehicles per year.

Musk had been expected to lay out a plan to build an affordable small electric vehicle (EV) to broaden the appeal of his brand and fend off competition, but late in the presentation executives did not elaborate on plans for the new model Or new financial goals for that year.

Musk declined to comment on a slide showing two hidden vehicles, though an executive said the next-gen platform is not a car.

Tesla Chief Financial Officer Zach Kirkhorn estimates the company needs six times the investment it has made so far to meet its long-term goal of increasing annual production to 20 million vehicles, or 10 times its current capacity. He said the bill could be $175 billion.

Musk began the question-and-answer session by announcing that a new Tesla factory would be built in northern Mexico. On Tuesday, Mexican officials announced that Tesla would build a factory in the northern state of Nuevo Leon. This will be the company’s first plant outside of the US, Germany and China.

Tesla shares have fallen by about half from their peak in November 2021, but have rebounded more than 60% this year.

mass market

Capturing the mass market is critical to Tesla’s goal of producing 20 million vehicles a year by 2030.

The automaker has just four models, all of which are priced towards the premium segment. Executives say the Cybertruck pickup will arrive this year.

Musk said Tesla may only need 10 models to achieve annual sales of 20 million vehicles. This would be an average of 2 million units sold per year per model line. By comparison, Japan’s Toyota, the world’s largest automaker by sales, sells just over 1 million vehicles a year globally.

Tesla is already far ahead of its rivals in profitable electric vehicle manufacturing. Chief engineer Lars Moravy said the company hopes to build the next-generation car at half the cost of the current Model 3 or Model Y.

Moravy described the production process for future electric vehicles, which he calls an “unboxed” model that reduces costs by stitching subassemblies together and reducing the complexity and time of assembly.

Tesla executive Peter Bannon gave an example of how the company is using data to cut costs. Customer data showed Tesla owners weren’t using the sunroof, he said, “so we removed it.”

High-profile Tesla investor Ross Gerber said on Twitter that the presentation amounted to a “huge tease” of the next-generation car. “It’s coming. They’re going all out. 50% cheaper to build. Will get you a $250,000 to $30,000 EV!”

Tesla has outperformed the industry in recent years, with deliveries ramping up rapidly despite the impact of the pandemic and supply chain disruptions.

But Tesla has cut prices in recent months to boost sales amid a weakening economy and the growing threat from U.S. and Chinese rivals.

Tesla must also improve its battery technology, which Musk called a “fundamental limiting factor” in the transition to sustainable energy.

In 2020, Musk unveiled plans to develop batteries in-house that he said would enable a $25,000 self-driving electric car by 2023, but Tesla has struggled to expand the so-called 4680 battery. Production scale.

Tesla plans to start producing battery materials this year at a plant with a lithium refinery and a cathode plant in Texas, executives said on Wednesday. They did not update their 4680 cell production numbers.

First published date: March 2, 2023 at 08:18 AM CST


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