We dug our own grave. Elon Musk.
Elon Musk addressed investors with the following message: "The Cybertruck, we have to admit, has created challenges that are of our own making. It's a rare gem, a product that comes along once in a blue moon. However, bringing such unique products to market and ensuring their profitability at scale is an extraordinarily complex endeavor."
While the initial Cybertruck deliveries are slated for November 30, Musk cautioned that it might be up to 18 months before the vehicle generates a positive cash flow. He stated, "I want to stress that achieving mass production and profitability with the Cybertruck will present formidable challenges, but this is a part of the normal process."
Despite these challenges, Musk emphasized that demand for the Cybertruck remains exceptionally high, with over 1 million potential buyers reserving one with a $100 deposit.
Additionally, Musk expressed concerns that elevated interest rates could diminish the demand for electric vehicles. This shift in tone marked a departure from Musk's earlier assertion that Tesla was "recession-resilient." Even though the company missed revenue estimates by a significant margin, Musk remains confident in Tesla's future.
Tesla plans to further reduce prices in the current quarter to meet its annual goal of delivering 1.8 million vehicles, even though its gross margin decreased to 17.9% between July and September from 25.1% the previous year. Analyst Toni Sacconaghi of Bernstein noted, "We continue to view Tesla as an automotive company, and the competitive nature of the industry could pose challenges to sustaining a profitability advantage."
Did they or are the current designs getting SO long in the tooth that Cybertruck will save current customers from defecting to other brands?