04.04.24
Tesla just sold the 6m-th car globally.
280k of them were sold until the end of 2017 and are not equipped with any FSD hardware (although around 240k of the 280k are equipped with the Single camera, MobileEye Autopilot).
FSD Hardware includes 8 Cameras and Computer Hardware V2-4.
It is included in every car Tesla produces since August 2017.
Between August 2017 and March 2019 when HW3 was introduced, Tesla sold around 300k cars with HW 2-2.5, which require a Computer swap to run current FSD (included in FSD price for those paying customers).
Other than 600k cars sold globally until March 2019, Any of these 5.4m Tesla cars in the global roads right now are FSD capable with HW 3.0-4.0 with a simple Software Over the air activation.
Tesla currently sell at a 1m per 6 month rate globally.
This puts Tesla global FSD capable fleet at around 7m by the end of 2024.
At this time, Tesla FSD is activated only in US and Canada.
The Total HW3-4 vehicles in the US/Canada today is at around 1.9m, expected to reach 2.4m by end of 2024.
400k cars in the US/Canada are already subscribed to FSD, mostly by purchase.
FSD is currently sold for $12k or $199 per month on a subscription.
Due to Accounting regulations, Tesla cannot recognize all paid FSD as Earnings, since it has not provided the full capability that was promised (deferred revenue).
It is estimated that Tesla still does not recognize up to 25% of current new FSD revenue.
Due to the introduction and wide Us/Canada distribution of FSD 12.3 And out of Beta mode, Tesla might reach 90% or higher of those new FSD revenues.
However, Tesla still has $2.86B of deferred revenue mostly from previous FSD revenue although some also from Semi, Roadster and Cybertruck deposits.
Deferred revenue is considered a liability since the company still needs to provide the product.
However, Tesla is probably sitting on a near $1.5-$2B of deferred revenue that could turn to an asset since it could convert to a product at no cost over night.
After all said and done about the 400k cars already sold with FSD.
There are 2m more cars potential pure profit by end of 2024 in the US and Canada.
There are also 4.6m cars presenting additional potential pure profit globally by the end of 2024 as soon as FSD will begin activating in other countries.
Currently, the FSD take is only around 20% in the US,
Representing only 6% of total global sales annually.
FSD has the potential to earn a net profit margin of $2400 per year by subscription, a nearly pure SaaS profit.
Just to put this into perspective...
Tesla can make from FSD $2400 net profit, per car per year! On top of the net profit of around $5.5k it currently makes for every car sold (down from $9.5k in 2022, which is the lowest for Tesla since 2021, a year after it crossed into profitability).
Comparing to the Auto industry average of 7.5% net profit margin per car... Which is anywhere from $1500 for Toyota, to $2500-$3000 for Ford and GM per car sold once in the cars life time.
Tesla is creating a complete different industry here.
A product that could earn Tesla net profit of $5k-9k at sale, and another potential net profit of $12k in 5 years, or $24k in 10 years...
Out of an average cost of $36k currently to produce an average Tesla.
Are we missing the Forest for the trees?
If it looks like a Car and it drives like a car? Is it just a car? Or perhaps it is a completely new concept?
No other company is including "useless" expensive hardware in all their cars since 2017 while developing the Software that could earn them literally a new car profit every year for the life of the car.
Maybe comparing cars sold is not the proper matrix?
Comments