Tesla Must Be Doing Something Right, Still Out Selling Peers

Tesla 

Tesla (TSLA) fell by almost 7 percent today after the company reported second-quarter deliveries, bringing the total for the first half of 2017 to around 47,100, on the low end of the company’s guidance.
Tesla Stock Price TSLA

TSLA Price data by YCharts

Behind the fall was news of a call from Goldman that Model S & X production has stalled out around 24,000 cars per quarter.

Tesla Total Deliveries

Kind of hard to say it stalled, with the company showing some solid growth rates year-over-year.

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Tesla’s Competition

Additionally, Tesla delivered in one-quarter, what Porsche North America’s total production in 2017 has been, which is about 27,000 cars.

Model

June Sales

Year-to-Date

2017

2016

2017

2016

ALL 911

686

852

4,395

5,027

ALL BOXSTER/CAYMAN

431

687

2,474

3,362

ALL PANAMERA

518

506

3,001

2,198

ALL CAYENNE

1,010

1,215

7,060

7,991

ALL MACAN

1,871

1,222

10,638

8,129

GRAND TOTALS*

4,516

4,482

27,568

26,708

*918 Spyder sales are reflected in 2016 grand total figures.

Porsche PR

Then, of course, you can compare that to Audi’s America’s A6, A7, and A8 which year to date have deliveries of a total of 11,860, which is down from nearly 11 percent from a year ago.

AUDI US SNAPSHOT –MTD– –YTD–
Model Line June ’17
Actual
June ’16
Actual
Yr/Yr %
change
June ’17 YTD
Actual
June ’16 YTD
Actual
Yr/Yr %
change
A3 1,904 2,818 -32.4% 10,417 14,642 -28.8%
A3 e-tron 324 353 -8.2% 2,120 1,942 9.2%
A4 3,022 2,802 7.9% 17,269 14,919 15.8%
A5 2,374 802 196% 6,739 4,334 55.5%
A6 1,425 1,690 -15.7% 7,969 8,328 -4.3%
A7 224 487 -54% 2,290 3,056 -25.1%
A8 301 303 -0.7% 1,601 1,941 -17.5%
allroad 251 134 87.3% 1,383 837 65.2%
Q3 1,741 1,719 1.3% 9,086 8,468 7.3%
Q5 4,498 4,419 1.8% 25,747 21,986 17.1%
Q7 3,114 2,613 19.2% 16,732 14,741 13.5%
R8 75 72 4.2% 481 262 83.6%
TT 163 233 -30% 1,137 1,478 -23.1%
Total Audi Sales 19,416 18,445 5.3% 102,971 96,934 6.2%
Total CPO Sales 3,290 3,842 -14.4% 22,236 23,064 -3.6%

 

Audi PR

BMW is seeing the same with North American Sales of its 7 series down by 24 for 2017 YTD, its 6 series down 21.1 percent year to date, and the 5 series down 13 percent year to date.

Say what you want about Tesla quarterly deliveries, the company seems to be doing something right, in what looks like a challenging luxury market.  These companies like it or not, are currently Tesla’s peer group.

Tesla Production

Tesla has said it will update guidance for the second half closer to the official launch of the Model 3. Based on the current production the company has already done this year, and what Tesla has said so far regarding the model 3, 140-150k cars in 2017 seems do-able, in my opinion. The big focus will be on how much production the company ramps up for the Model 3, and of course any news on the Model Y.

Interestingly today, Volvo also said it would it would begin to phase out combustion engines and offer only hybrid or electric starting 2019.

Additionally, as Tesla ramps up production and the Gigafactory starts running to full functionality, my expectation is for the cost of the battery to be reduced over time. Thus helping to increase the company’s profitably.

Biotech

Biotech moved higher again, after last week’s retracement. The Biotech SPDR (XBI) jumped roughly 1.66 percent, outpacing the Technology (XLK) and the Nasdaq (QQQ). Shares of Energy Stocks fell on the day with the Energy SPDR ETF (XLE) down by nearly 2 percent.
Biotech has strong day

XBI Price data by YCharts

Biotech is now the leading sector once again in 2017, with the XBI up nearly 34 percent.
Biotech Leading ALl Major Sectors and Technology

XBI data by YCharts

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Disclaimer:

Michael Kramer and the clients of Mott Capital own shares of Tesla (TSLA)

Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendation made during the past twelve months. Past performance is not indicative of future performance.

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