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Shit Elon Says - Transcript - Tesla Q1 2015 Earnings call

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Umm.. sure. Yeah, that's about right. Obviously with Model X production ramping up quite heavily in Q4, depending on how that ramp goes, and obviously it's difficult to predict that with clarity, but our volume essentially doubles in Q4. Depending on how the ramp goes - I want to emphasize that because what people don't entirely appreciate is that there's several thousand unique parts in a car and if even one of those parts is not available - for any reason - then you can not scale production. So, ya know. Essentially the production ramp goes according to the unluckiest worst performing supplier, or part of Tesla, but that said we do expect to see a significant ramp in Q4 for the X and have something that may be as much as two times other quarters in Q4. As far as demand for that, we do not see that being a problem. Obviously there are huge advance orders for the X and we see a steady climb in demand for the S.

[Question about speed of moving resources.] Yeah, in the case of the X, it ended up being a lot different than the S than we originally anticipated. So the development took a lot longer and we were distracted solving all sorts of issues with the S during that time, which made it difficult for us to allocate engineering resources to the X when there were issues to be solved with the S. I think we'll do a lot better with the X and we're paying close attention to some of the things that are different about the X to ensure that they're not an issue. Particularly the falcon wing door and the second row seats. So I'm feeling pretty good about things, but because that production ramp just scales exponentially, depending on where that exponential curve falls across a quarterly boundary can make quite a significant effect on the production deliveries in that quarter. So that's why - it's quite easy to predict if it's continuous but quite hard if it's discrete with arbitrary quarterly cut offs. I really think the X is going to be a great car. I just drove the latest prototype today and it's like, wow. This is by far the best SUV.

The Z credits thing is not like - it moves things by like 2%. Ya know, it's not super-material. I'm still not sure what the point of your question is. You realize Z credits don't sell for 100 cents on the dollar, they sell for like 50 cents or sometimes less, and there are not always customers for the Z credits. It's not a big deal. As more of our production goes overseas, obviously there are no Z credits overseas and as our sales increase outside of California, or Canada, those are not Z states. The Z stuff is an increasingly small part of the picture, over time. [There's hundreds of vehicles in the battery swap program.] Yeah. Yeah. We've steadily increased the invitation list. We've just found there's not a lot of interest in people doing pack swaps. So we make the invitations and we get a small percentage of them that actually take us up on the invitations.

[Question about Solar City using the Powerpack.] Yeah, let me just talk more broadly about the response to the Powerwall and Powerpack, because I think that's really the question you should be asking. The response has been overwhelming, okay, like crazy. In the course of less than a week we've had 38,000 reservations for the Powerwall, 2500 reservations for Powerpack. The Powerpack, it should be noted, typically this is bought by utilities or large industrial companies - for heavy industrial work - so typically Powerpack is at least ten Powerpacks per installation. So if there's 2500 reservations, that's actually 25,000 Powerpacks. Powerwall, also, we suspect is probably an average of 1.5 to 2 per installation. So 38,000 reservations is more like 50 or 60,000 actual Powerwalls. So that - I mean there's no way that we could possibility satisfy this demand this year. I mean we're basically sold out until next year, in the middle of the first week, it's crazy. We had 2500 requests from companies that want to distribute and install the Powerwall and Powerpack. We can't even respond to them. This is - we have to, like, triage our response to those who what to be a distributor. So, it's like crazy off-the-hook. Yeah, and it seems to have gone super viral. For the specific case of Solar City, what they're referring to is that there's two versions of the Powerwall - there's the daily cycling version and there's the power backup version. One's energy optimized and one's daily cycling optimized. For the daily cycling optimized one, the economics - it is true in the US, with rare exception - are more expensive than utility. So, if somebody wants to do a daily cycling - basically go off-grid, it's going to be more expensive than being on-grid. This doesn't mean that people won't buy it, because there are people who want to go off-grid on principle or they just want to be independent. That's what the Solar City comment is about.

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