Click-bait. Tesla revenue for 2020 was $31.5 billion. The credits were $1.6 billion. Significant, but only 5% of the total. Plus these credits come from selling cars.

You’re missing costs in this equation. Without the sale of the credits they would not have been able to post a profit for the quarter. They may have had $31.5B in revenue but the cost of that revenue was greater.

If I sold a $1 can of coke for $0.70. I can report $0.70 of revenue but i still lost $0.30 on the transaction.

Related thread: https://news.ycombinator.com/item?id=25981497

The consensus over there seems to be that they have decent unit economics and the impact of subsidy removal is that they'd probably have to convince the market to accept negative net income, or grow slower.

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Here we go again: building factories does not come off the income line. They are selling cars at a loss. Whether they manage to change that with increased scale is yet to be seen, but they are selling more cars and making less money.

That's why the Credits are there to help increase the viability of electric Car/Truck production! That's just not good reporting to try and spin that as a negative and Ignore the needed viability of that EV market.

The Air Pollution impact on the health of the population and a reduction in the respiratory illness/other heath impacts must be figured in as part of the equation regardless of who is helped by the credits. The Credits will indirectly help to reduce pollution especially in crowded urban areas and reduce the overall rates of sickness related to ICE Pollution! That ICE pollution also takes its toll on Building facades and statuary and even has an affect on roads and bridges so that's another reason to have the credits until the EV production can become viable on its own without the need of any credits/assistance.

>hat's just not good reporting to try and spin that as a negative and Ignore the needed viability of that EV market.

There's nothing wrong with Tesla receiving credits, or even "counting" the credit dollars as profit. It's real cash coming in.

But when you are trying to analyze the financials of the company to determine a valuation, noticing that without the credits (whose accounting is opaque and which won't last forever) they lose money, is important.

But the energy Credits where not Hidden in the Tesla Filing so what was Nefarious. There's no Secret there and that's why the credits are there to Help Tesla/Other EV makers become Viable and reduce pollution that's very costly to society in the form of health related costs related to Air Pollution!

Thanks for the correction.

Tesla has many avenues of action available to them and many goals. One goal recently, I think, was to get 4 quarters of profitability to get listed on the S&P 500, among other reasons. These credits exist, so they factored that in to what they needed to do to show a profit. If they did not exist then Tesla (Elon Musk) could have altered what they were doing some to get to profitability. Maybe get there a quarter later, push up short term production trading off R&D, etc. I am not a CEO but this is what they do.

They are stapling $2500 to every $50,000 car they sell -- $2,500 they are only getting through a government subsidy (regulatory requirement rather than direct payment in this case).

This is why the GM announcement is significant: Tesla will have to learn to up the quality and reduce cost so they can survive without the subsidy.

I’ve been trying to buy a tesla roof and powerwalls for over a year. That whole side of the company was missing in action for all of 2020, yet they post record profits. Their reliance on credits explains the discrepancy.

Having said that, sign me up for multiple vehicles once I’m energy independent! I see no problem with them using credits to bootstrap carbon neutral transportation.

What's the general view on the warranty on the solar panel or roof or powerwalls sold by Tesla? Is Tesla still around well capitalized in 25 years to honor the warranty?

When you buy a Tesla, it doesn’t decrease pollution, it just allows another automaker to pollute more. Tesla sells these to stall competitors’ electric vehicle programs.

Maybe but that's the method that Tesla is using and something has to be done to get the EV industry jump started no matter if that's Tesla or Others that get that EV market made feasible!

But the ICE automakers are all going to be offering EVs and on their Own to make their own credits usable but Tesla/others are eventually going to be viable without the credits needed.

This is ridiculous. Other automakers aren’t being forced to buy Tesla’s credits.

Seems like another instance of straight lines on graphs driving reality: https://slatestarcodex.com/2019/03/13/does-reality-drive-str....

If the author doesn't care about poor people not getting food and dying from climate change, at least think about the billionaires who bought private islands whose value can lose hundreds of millions of dollars if the climate change continues. They will be the reason CO2 emissions will be taken seriously.