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      06-16-2017, 05:51 PM   #29
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Drives: 335i, i3
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This is in response to afadeev, and as required, without the emotions. There is a seekingalpha article that went through the math. Tesla reports gross margin without R&D which is different than most other car companies. They went through four years worth of annual reports for other companies and calculated margins with and without R&D and found Tesla was near the top in that category, but not at it. Once R&D was considered the comparison looks pretty bad for Tesla; margin drops to 10% and was lower than all eight other companies in the comparison. Even more damning is the sales, general and administrative expenses which were so high they alone wiped out all the profit not even accounting for R&D. Even worse, the SG&A has scaled up linearly with volume so Tesla has not been able to take advantage of economies of scale. They cannot be profitable, or even begin to compete with the profitability of established OEMs, even if they weren't spending money in other areas.

Cheap cars get to be cheap by removing content. Unfortunately for EVs a cheap car still needs a big battery, motor and drive system to get the range, so it's not like an entry level Model 3 can suddenly be so much cheaper than a Model S at the same range. It will end up meaning even worse margins.

As far as the autonomous stuff, it's hard to argue since data is not available. I have seen the autonomous tech from the OEMs and suppliers and it is every bit as good and likely better than Tesla's; however, there is no way in hell that any OEMS will roll out tech that kills people. They would get sued to no end by every two-bit lawyer in the country. Tesla can get by without the scrutiny because they don't have the deep pockets. Right now car accidents are the fault of the driver. If autonomous they are the fault of the manufacturer and that is a massive liability to accept. For now they are choosing to let things mature.
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