Tesla Model 3 Delay Insights from Earnings Call – Are We Still in Production Hell?

– Hello and welcome to Teslanomics live, everyone I’m your host Ben Sullins This is a live show where we break down the latest news from Tesla, from the week that has passed We do it live because, well, things change rapidly here and I don’t want to miss any big stuff that comes out If you are not on the email list and you want to join in the conversation, you need to go get on it at teslanomics.co/join That’s where I will send out the invites to join me on Crowdcast Crowdcast is more of an intimate community It’s still free to join and all that There’s really nothing, you don’t have to pay for anything or buy anything, it’s just a different place that we do it, and it’s more for the folks that are really into this and want to join the community, not just kind of browse and be in view only mode If you’re on YouTube, I won’t be paying attention to any of the comments or any of that, so if you have questions, go hop over to Crowdcast, that’s my message to you And I send those out, usually kind of Sunday afternoon or Monday morning Lately, I’ve been sending the wrong link, but typically, you get a link there, you hop in, and then you’re registered And I do limit it to a certain number of people because otherwise, it just gets completely out of hand and the questions and all that don’t really make sense Also, if you’re watching this after the fact, and don’t want to hear me blab about this or a bunch of the other stuff, I’ll put timestamps with all the different stories in a pinned comment down below so you can go search for that and then just find a specific story that you’re interested in And the first story that we’re going to start out with today has to do with the model 3 delay Let me bring that up on the screen for you and we can kind of talk through some of the stuff here Tesla just had an earnings call and we’ll go over a lot about that in detail here, but there were some interesting tea leaves out of there In addition to that, a lot of folks, myself included, just recently received an update, an email, saying that our model 3 delivery is delayed Now, I already have my first model 3, but my second one was the one they were talking about For most people, they delayed it over to late 2018 for the standard battery I’m going to talk about my thoughts on that a little bit later, but let me just go through the basics of it here Late 2018 for the standard battery That’s pretty much everywhere All wheel drive in Canada is coming out mid 2018 for some reason, so they’re actually getting bumped up and maybe that’s to do with bringing in the higher profit, the more revenue up front, and I think I have an article from electronic on that as well Really interesting that they’re expanding into Canada sooner than originally planned, and Elon on the earnings call alluded to a little bit of this as the modules in the production line were, two of them specifically, were problematic So two of the four were giving them, kind of creating a bottleneck, and that is actually why we’ve seen delays, and he said it was a bit of complacency that they thought they were really good at making batteries for cars and it turns out that because of whatever the circumstances are with the model 3, that posed many more challenges than they had anticipated They have a company in Germany that has actually built a completely automated system that will solve this However, as you may have just guessed, the problems is that this stuff is in Germany, and I have an article for that explaining that as well The battery assembly and all these things that were the issue, they’ve figured out, they believe that they’ve figured out, but they need to disassemble them and then bring them over to the United States, reassemble them, and hope there aren’t any problems And as Elon, there’s a quote here on this, Elon said on the earnings call, that’s got to be disassembled, brought over to the Gigafactory, and reassembled, and then brought into operation at the Gigafactory So, there’s definitely some opportunity for problems to arise there But there you have it This is kind of what’s going on It has been delayed, pushed back, I’m sure a lot of your with reservations know that And it’s kind of an interesting story but one that is continuing to develop As more comes out, we’ll continue to cover this story There’s some other pieces on the earnings call that Elon alluded to about this One in particular was that they’re still on track for 2,000 to 2,500 cars per week by the end of March To me, that was interesting because they’re softening it It was 2,500, now it’s 2,000 to 2,500, okay What’s next, 1,500 to 2,000, and then 1,000? I’m not sure if they’re just kind of speaking generally and not being specific which doesn’t sound like Elon, but that was one little tidbit I picked up on was that there may be even further delays,

which would be pretty bad The thing about that is they’re still confident in the 2,000, 2,500 by the end of March and that depending on these new systems, these automated systems, how they get installed and how quickly and successfully they do on that, that may affect their 5,000 per week target which they are now reporting at the end of Q2 That’ll be interesting, because that could, once they get that going, that fixes the bottleneck, and that really changes the whole delivery ramp I think that these are things that we’re going to hear more of, and this story’s going to continue to develop In the meantime, thousands of people are getting the model 3s, and it’s happening, and as the delivery S curve or the delivery ramp suggests, it’s very slow in the beginning and then it takes off and goes linear and then it eventually kind of caps out We’ll see what is left of this story It sounds like the next big thing that we’ll be waiting on is whether or not that machinery gets installed correctly I don’t anticipate we’ll hear any of that until the Q2 earnings call, if that, I’m sure somebody’ll be pressing them on that There you have that That is the major story here It’s a bummer I’m still really hopeful that 2018 is going to be a major year for Tesla, especially with the model 3 The original estimate that I had before, it still pretty much stands, if you guys saw my video where I did the S curve calculus on it, it still matches, ’cause they haven’t changed guidance yet I think that this isn’t really that big of a news story because we already knew this, but now, it’s actually hitting home for people because they’re seeing it change I did actually just meet somebody I’ll give you one little extra tidbit, and this is, it’s someone that told me that this worked for them Your mileage may vary, don’t quote me on this, but they said that they actually bought a used model S, and that jumped their place in line The Tesla sales had told them it would, but what happened was they bought their used model S and then their delivery estimate on the Tesla website changed to much sooner than it was before, and now, they’re kind of in a conundrum, because they bought the model S thinking that, all right, we’ll just get a model S It’s a better car overall, and it’s relatively the same price as they were gonna pay, so whatever, they’re just gonna do it They want to own a Tesla now But now that they can get their model 3 sooner, they’re kind of stuck in this position That’s something to consider out there is that, again, you can talk to a sales rep and ask and all that, but that could be a way to get a model 3 a bit sooner, because of course current Tesla owners get it faster So, there you go That’s kind of the main story here on the model 3 delay I’m curious what you guys think if you are in this boat Are you pissed? Are you disappointed? Are you kind of whatever and not really too upset Leave me a comment down below, especially if you’re watching this after the fact That’s the main story today The next one is kind of a fun one, and this was insane This was the Roadster that went to Mars or that’s on its way to Mars I believe it’s not going to actually make it to Mars because they missed the orbit a little bit, but in any event, if you guys didn’t watch the Falcon Heavy launch, you gotta go do that It’s pretty incredible You can see it on YouTube or all kinds of different websites, and I would just go to a few seconds, maybe 15, 20 seconds before the actual launch and check it out And then, of course, these photos here are just absolutely mind blowing That’s actually Zuma, that’s a different one, but there you go, the Falcon Heavy with the three rockets and then the two coming down at the same time, and the photos of the Roadster in space It’s yeah, that’s absolutely insane Super cool, definitely go check that out if you guys didn’t I’m sure you guys saw something That was all over the news The reason I love this, and this is why I really love Tesla is because they are one of the few companies that are really pushing the boundaries of technology I know that there are some companies out there making really fantastic ways to take selfies and share those with people but, you know, on the important side of what technology is doing for humanity, these guys are at the forefront SpaceX and Tesla are really doing stuff that no one else is, and so it’s really fascinating I shouldn’t say, there are other companies doing it, but they seem to be winning at it, and really giving all of us hope As a young kid, I wanted to be an astronaut and I couldn’t even imagine if I saw stuff like this I would be cemented that that was my future

I just really am hopeful that this inspires so many other people to kind of dig into space and follow that because it’s so exciting and I’m just a big geek, so there you have it Okay, now on to the earnings call highlights My friend Ryan McCaffery, who has a podcast here called Ride The Lightning, the Tesla motors unofficial podcast I absolutely recommend this It’s a great show, but he also does a fantastic job going through the earnings call and actually playing back all of the little bits from Elon and J.B. and everyone else, so I’ll just kind of run through these quickly, some things that popped out to me I’ll put a link to his podcast in the actual show notes for today’s video First is they pretty much confirmed that there will not be 2170 cells in the model S and X, that they’re going to stick with 18650 If you have no clue what that means, don’t worry It just means that the Tesla model 3 has a newer battery technology, and everyone was kind of saying hey, how come you’re not going to put that in the S and X? It turns out they would need to reconfigure the entire supply chain and the manufacturing line would need to be updated, which means they would have to stop production on pretty much their only solid revenue stream at this point So, it didn’t sound, from Elon and J.B. talking about it, it did not sound like this was something that they’re going to do And that leads me into the speculation we’ve had about a refresh and potentially bigger, newer battery tech for the S and X I think we’re all very hopeful that we’ll see 130 kilowatt hour battery with 400 miles of range and stuff like that, there’s been a lot of chatter about it, but this really puts that into question for me whether or not we will see a bigger battery in these cars until much further down the road A lot of people I think are speculating that we’ll see it this year And I just don’t know They really made it sound like it’s almost impossible to do this, so they don’t want to That’s a big question Now, whether or not we see an interior refresh, I could definitely see that The model S specifically has some interior elements that I think could be updated I think the exterior is still gorgeous and still stands the test of time Maybe slight tweaks here and there, but overall I think it’s a fantastic vehicle, so I wouldn’t really change much on the outside I don’t see them, based on Elon and J.B.’s comments on the earnings call, I don’t see them changing the battery technology any time soon, but maybe the interior bits, some of the styling with some of the bezels around the screen and stuff like that could change I don’t know if the X would get any of that Maybe, again, some very minor things So yeah, that really stood out to me, ’cause I know a lot of us are really hopeful for that, but they made it sound like it’s definitely not a done deal and if anything, it’s leaning towards not happening for the foreseeable future All right, next was the coast to coast road trip that Elon touched on If you guys don’t recall, I forget when he did this, it was an interview at Ted Talk, I think, where they asked him about this and he said that a Tesla model 3 should be able to go from a parking lot in Los Angeles to a parking lot in New York City without a person touching the wheel at all And he said he could do it in November to December of last year It’s Elon time, so we’ll put that at maybe late this year And so, he basically addressed it and said yeah, they could have done it, but they would have had to manually code a lot of the routes and things and deal with that, so it wouldn’t have been something that was actually commercially viable, it would have just been kind of for show And that didn’t make sense That’d be kind of a waste of resources And also, that everything is going into the production of the model 3 and so they kind of diverted all resources towards it Yeah, he said we may see it, and it will be available to customers at some point Yeah, we’ll see Very curious if and when that comes to market I think it’d be fascinating, but again, it’s actually not something I really care about that much It’s kind of low on the list Next, he talked about model Y, and if you’re unfamiliar, model Y is the cheaper version of the model X is the way to think of it It’s kind of like what the model 3 is to the model S It’s like a watered down version of the model X If you’ve been in a model X, you know there’s a lot to water down You could simplify that car 100 times and it would still be a beautiful, amazing, fantastic vehicle The model Y is that It’s the cheaper version of the crossover SUV, and they look at this as the catalyst that will get them to one million cars per year, which I think the original timeline was 2020 for that There’s just no way they’re going to hit that, I’m just going to say, it’s not gonna happen

But, they will get there, it’ll just be longer than that Maybe 2025 or something The news was that Elon did address that they are going to make some capital investments later this year, which means probably a factory, lots of equipment for the factory, things like that And that, I think Deepak mentioned, the CFO mentioned that they could be profitable late in Q3 of this year but what they’re more likely going to do is take all that money and invest it into the model Y, which makes a lot of sense because the crossover SUV market is huge, and they stand to make a ginormous splash Model Y is coming I hope that we get to see an unveiling, maybe take reservations this year I, of course, will be putting one down and hope to go to the event and share that experience with you guys Now, there’s some interesting notes These don’t fall under a single theme here, but just some things that Elon touched on during the call that I want to mention One was that the factory will be the product, and J.B. talked about this as well that the real thing that Tesla’s doing isn’t the cars themselves Yes, those are beautiful and they’re fantastic and all that, but the factory, the design of the Gigafactory and the advancements in manufacturing are the things that will be their competitive advantage long into the future, and Elon gave an example of the model T, the actual car, the original Ford model T, that the car itself wasn’t the thing I mean, a lot of people look at that as an amazing feat, but really the assembly line and what they were able to do in the factory was the achievement He kind of looked at it similarly with the Gigafactory, and I think that’s interesting because the Gigafactory has so many applications that it could be for Cars is one, but home batteries is obviously another There’s so many applications, so many things in our world that can be transitioned over to battery technology, and with the Gigafactory, with that being the main focus, I think that that will really propel them into kind of probably one of the world’s largest energy companies down the road So, there you go Another interesting bit of this was that John McNeill, who’s the head of sales, is leaving and sales and service will now report directly to Elon And there is no intent of searching for a replacement That confuses the hell out of me because Elon obviously already has more than he can handle on his plate, although he’s a pretty amazing guy and he’s able to do a lot, there is a limit to human capacity, and so I’m really surprised by this I’m not quite sure why they wouldn’t find someone else But, anyway, wishing John McNeill the best of luck in his future endeavors, so there you have it I have one more update to my video on Friday, and if you guys didn’t see this, go check it out Okay, 1,000 likes, about 300 dislikes, that’s lower than normal I knew this was going to be a controversial video What the video was about was me having, after having my model 3 for a month and having a model S for two years, basically advocating for buying a model S over a model 3 You’ll get it obviously a lot faster, and it’s a better car It’s better in many, many ways In fact, Tesla also states this I’m surprised that that was very controversial, but a lot of people really seemed to take offense to that But maybe they have their little fiefdom or whatever, they’re little belief system and I’m encroaching on it But, from personal experience, from first hand knowledge, I can tell you that the model S is definitely a better car Now, the big thing that, I was talking to some friends about this, the thing, the addition or the addendum that I want to make to those statements and the video was that if you could get a model 3 for $35,000 or maybe $40,000 with autopilot or even the $44,000, and compare that to an $80,000 model S, I can completely understand why the model 3 is a better choice for a lot of people, why that makes sense My argument was basically that I would rather pay $60,000 for a low end, used model S versus a high end model 3, so that’s the comparison there The addendum is, look, if you can’t, I was arguing that the price doesn’t matter, but the price doesn’t matter when you have the high end model 3 and the low end model S, so if you take the low end model 3, yeah, that’s going to be quite a bit cheaper and I think that I agree with that sentiment If you’re not interested in autopilot or premium features or long range battery or basically any of the upgrades on the model 3 and you want the black aerorims, standard model,

no dual motor, no white interior, none of that, and you literally get it for $35,000, which, at this point, you’ll be missing out on most of the tax credit by doing so, so it’ll be really close to $35,000, you won’t get much of a federal tax credit here in the U.S., then yeah, I agree I think the price difference matters But if you’re adding any of those features and you’re comparing it to a used model S, I would take the used model S every day of the week I like it a lot And, in fact, I think I’m giving my model 3 to my wife and I’m going to start driving my model S again Not to say it’s bad, but for somebody that’s coming from an S, there is a lot to like about an S That was the point of this video I just wanted to add that for anybody that watched it and was really upset or anything like that Which, I knew people would, because they have their belief systems and they’re very strong about those Couple more items, then we’ll get it over to Q and A Thanks to everyone that came out to the model 3 meetup in San Clemente this past Saturday I had a blast sharing the car with you guys Except for the guy, the Bob Lutz fan that came out from GM or whatever who wasn’t really interested in having a conversation with us But anyway, for everyone else that was there, I’m glad you guys got to check it out I hope it was helpful to you and if you guys didn’t know about that, I intentionally didn’t want to publicize it a lot, follow me on Twitter because that’s where I post those little kind of things I didn’t want to create a big stir and have a hundred people show up and have security and all that, so I kept it pretty small I only sent out one tweet about it, I believe And so there you go Thanks for everyone that came out, and also thanks to Rob and Brenda Mosher, is that how I’m saying it, yeah, Mosher, Mosher, sorry, for sending me the birthday card Thanks, guys If you guys want to send me stuff, you can check out my about page on my YouTube channel, and I don’t know if the address is there I have a P.O. box where you guys can send stuff And so thanks, guys I read that and I really appreciate it My birthday was a couple weeks ago And then also, holy cow, congratulations to my friend Kim and her husband for winning a P100D Here you go, and I successfully jumped to the right spot Last year, there were the annual awards for the referral program, and they had a lot of different things and one of them was the first person to 20 referrals in each region, North America being a region, got a free P100D of their choosing, model S or X Of course, you’d get the X They had a little video here, they’re selling their model X, and they’re going to be, I think they’re getting a long range model 3, and then they’re going to hold out for the model S or another model X free from the program So congrats, guys, I’m super stoked for you, and we’re all in the same boat and it’s nice to see that Tesla’s actually following up on some of these prizes because, believe it or not, it’s a fantastic thing, the referral program, but the communication has a lot to be desired So many things that we’re stil just kind of completely in the dark about In any event, congratulations, Kim, and definitely go check out their channel if you guys haven’t heard of them Now let’s hop over to Q and A And on YouTube, let me see what I can do Yep, I’m going to leave it there, I’m going to leave it there All right, so if you are in Crowdcast, (whistles) if you are in Crowdcast, please make sure to go check out the questions there and I will hop over I’m going to go full screen so the people on YouTube can just see the one Okay, cool What can I do with that? No, oh okay, that’s interesting Look at that Okay, and the way that this works for those of you that don’t know, and I’m actually just going to cut off my camera for the guys on Crowdcast If you guys want, you’ll have to see me on YouTube, but you’ll still be able to hear me, so that way it doesn’t create a weird kind of double effect Okay, cool, so here we go Just make sure everything looks good there Yeah, let me bump it up just a little bit Cool And the way this works, guys, is that I’ll click this button here, start answering, and then what’ll happen is it’ll time stamp it, so if you guys are in Crowdcast now or later, you can go to the ask a question section and view my answer directly You don’t have to actually skip around and find it, you can just jump straight to it And I’ll also usually share these out on social media with direct links back That’s kind of the thing behind that So, there you have it, let me see if I can do this over In fact, you know what, I’m going to turn my camera on because it’s not fair because in the replay it won’t be there So there you have it Cool, cool, cool

All right, so first question from Walt Walt asks, do you feel buying the upgraded interior and expanded battery mileage and the autopilot will greatly enhance the re-sale value or sell ability of the car? I’m not sure about the second question there But what you’re getting at, I believe, is whether or not it makes sense to get those things in terms of re-sale I don’t think so It certainly will If you’re buying a truck and you want the four by four version, well yeah, that’s gonna be more expensive that the non, so it certainly will help, but in any event, it’s not going to be something that I would personally buy just to have for re-sale I think a lot of people are going to be interested in the car regardless of that And I do know lots of folks that really don’t care about the premium interior Some people that are really overzealous about it The mileage is probably the big one The autopilot can be added later, so I wouldn’t worry too much if you’re really not interested in that I personally wouldn’t buy a Tesla without it nowadays, but hey, whatever The extended mileage is the one I would absolutely buy, because I think that will be a big differentiator here Thanks for the question, Walt Max asks, what do you know about the model Y? I just shared that, hopefully that was helpful to you Devin asks, hey Ben, I recently saw an article about a former GM employee that specializes in tearing down cars for fit and finish he recently began work on the model 3 My concern is that he mentioned that in the event of an accident or fire, the rear passengers could not get out using the driver’s side due to the emergency release Yeah, yeah, yeah, yeah Well, having a baby might be hard to get them out anyways, right? I don’t think the baby’s going to make their way out Certainly, my toddler couldn’t do it anyways Here’s the deal, and I’m not sure, I mean the official answer I heard on this is crazy So, here it is In the front seats, the front doors have emergency release handles, that being manual, not electronic, because if you’re in an accident and the electronics in the car fail, which can happen, or if the battery dies eventually, you can’t get out In the back seat, there’s no manual way to get out of the back seat I’ve heard that the answer is to pull down the seat and crawl out through the trunk which has a latch, but jeez, that’s kind of ridiculous So yeah, the front seats do have them, but the back seats do not The front seats have the manual ones and the back seats do not Something that definitely is concerning I don’t know about the baby situation, I bring my toddler in it and stuff, but yeah, it is kind of concerning and I’m not sure if there’s any kind of official answer on that yet It is true, though, for sure So yeah, thanks for the question Devin Carlo asks, being from Canada, our winters are pretty unpredictable I understand that the car is made of both aluminum and metal I believe aluminum is a type of metal I think you meant steel I also have been told that the model S and X don’t need to be rust proofed Do you know what parts of the model 3 are metal and do you recommend rust proofing? It’s yeah, it’s not something I have any experience with, but I do recall Trevor at model 3 owners club doing a breakdown of the components because I think it was one of the help manuals or something of the car actually listed it out and they had some diagrams in there, or maybe it was the fire thing where you know where to cut and that kind of stuff So yeah, go check out model 3 owner’s club He lives in Toronto and I understand that it snows there and this is an issue for him Check that out I can’t really speak to it otherwise Probably rust proofing makes sense I have no clue how expensive that is but yeah, it’s not 100% aluminum, so yeah, there you go Thanks for the question, Carlo Joey asks, I know the model 3 battery indicator has the rated miles on it, but is there a section to see suggested range based on driving and weather similar to the model S? And you take delivery this week Hey, congrats No, that section does not exist It doesn’t have any of the battery energy consumption charts and graphs and projections or anything in there If you’re using navigation, I believe it will take that into account, but it’s not like the model S and X where it shows you that There’s nothing in it as of this morning when I drove mine that shows that So yeah, to come, I’m sure that it’ll be there, and I believe it does include that in the navigation,

but it doesn’t show it to you So yeah, something that I was pretty bummed on because I’m a data guy and I want to see that stuff Thanks for the question, Joey, and congrats Michael asks, hi Ben, please research how many Tesla cars has sold in the USA and project if they will hit 200,000 cars sold Yeah, Q2, going with it, still going with it Here’s the deal I believe, when was the last time I actually looked at this? Mid December or late November I think I looked at it and they had 140,000 in the U.S You throw in a pretty solid 25,000 a quarter from the S and X alone, you add in a few thousand for the model 3, yeah, Q2 I would imagine that, so if you add in, we’ll be at like 175,000, 180,000 by the end of Q1 is a rough guess based on the last time I looked at it Go over to insideevs.com, they have the monthly score card and they probably have a blog post on this, I’m not sure I’m not going to do a video on it, but all signs still point to Q2 for them hitting the 200,000 mark Now some people speculate that that’s why they’re planning on pushing the model 3s to Canada, but I still just, I think they would have to stop S and X production (laughing), which doesn’t seem like a smart thing to do If they can, man, if they could stretch it out and hit it first thing Q3, that would be an amazing feat I don’t see them doing it, though So, Q2 is still kind of where it’s landing on And you know, this is how these things work, right? We do this projection a year and a half ago and it’s like wildly all over the place Then, as we get closer and closer and closer that error bars get smaller and smaller and right now everything is pointed to Q2 There you go, thanks for the question, Michael Vic asks, why do you think the all wheel drive for Canada got bumped ahead of the all wheel drive in the USA? Yeah, that was it right there In theory, it’s so that the tax credit can be extended, but maybe it’s just because they want to start selling them sooner so that that way, they can have a higher profit In any event, we’re all speculating, but yeah, that’s a guess Carlo asks, Ben I understand the Tesla app has recently been updated Oh, has the model 3 software been updated as well? No, no updates to the model 3 stuff Let me just see right now, actually, I’ll just check I want summon in my, that’s the one thing that I, ’cause I don’t have it in my model S, I really want to be able to summon my model 3, I think that’s a cool, even though it’s kind of like a dumb party trick, I won’t really use it, it’s still pretty cool I’ve had all kinds of software updates from my model 3 recently Let me see, controls No, no heated steering wheel Yeah, nothing new, nothing looks new to me on that, but I’m just checking right now Yeah, obviously more to come Thanks for the question Jacob asks about any Tesla’s ability to avoid accident if the car stops by itself because something is happening in front will it start driving a little bit forward again to prevent an accident I don’t think so, I don’t think it’s that smart You’re talking about the, actually no, someone told me that if you’re stopped and it detects somebody’s going to rear end you it will actually come forward I’ve not seen that I know Marques talked about it in a video, an interview he recently did on the H3 podcast, but I’ve not seen it Yeah, in theory, it’s supposed to do that Yeah, I have a lot less faith in autopilot than a lot of other people, but that said, I don’t have the most amount of experience with it, either Yeah, interesting question I think as time goes on these features will roll out and it’ll be, but it’s supposed to do it, but we’ll see Thanks for the question, Jacob Let’s see here, Carlos asks, I just read this article, cool According to the study by Navigant, Tesla is currently dead last in the self-driving race Yeah (chuckles), yeah, yeah Someone brought this up, I don’t know Self-driving is not the thing that I’m most excited about with Teslas I still very, very rarely use autopilot I think driver assisted are there Yeah, they could be right, they could be wrong Who cares? Not something I’m concerned with Thanks for the question, Carlos Max asks, does the zero to 60 of the model 3 feel like 75D or 100D? Definitely not the 100D Yeah, it’s pretty powerful Definitely not close to 100D a model S I’m going to go race my buddy, there’s actually a place here in San Diego that does it, I think it’s every Friday, but we need race helmets, so we need to go get those Yeah, the model 3 is quick,

but that quickness very quickly dies out I’m very curious to see the performance version of the model 3, which I’ll be getting later this year, or hopefully later this year Thanks for the question, Max It’s fast You don’t have to worry about it, but yeah, compared to a model S, definitely not as fast Trevor asks, whatever happened to the trans-America self-driving Tesla by the end of 2017 Yeah, there you go, so hopefully you caught it earlier and on their earnings call, I talked about it Hoping to do it, but wasn’t a priority Probably still isn’t a priority, honestly I don’t see why it would be a priority in my view Jorge asks, since the model 3 and Semi are going to share the same power train, do you think the drive units will be relatively cheap due to the mass production? Hm, also if you could talk about the repair pricing throughout the models as the info becomes available Yeah, so repair pricing is interesting I mean, everything is pretty much still under warranty Well, except for the parts on the older ones Yeah, so it’s interesting, I do think the Semi’s going to be a huge hit and be an incredibly profitable unit model for them The question is where they can manufacture it, because there’s absolutely nowhere they can do it in Fremont, unless they’re hiding something that we don’t know about, but when I visited and everything that Elon has said, they need a new place to do it That would be the big question And then if they’re able to successfully use the model and the factory as a product blueprint that they’ve been developing, then hopefully they’ll be able to spin up new factories quickly and that will be kind of the major success of them Yeah, we’ll see, lots to come And of course, yeah, repair pricing and stuff, I’ll talk about it when it makes sense Thanks for the question, Jorge Andre asks, do we have any info about the model 3 towing capability? Yeah, nothing for the gift, I’ve heard, and it doesn’t have a tow rack or anything like that, so no Zero, I guess Thanks for the question I’m going to run through these kind of quick, we still have a lot of them left, I think Ben, I see my updated model 3 delivery estimate Yep, delayed by three months and the Dual version will be available before the Base version Huh, yeah, talked about it already Thanks for the question, Jim Are any rumors, updates on when Teslas will get revamped and improved mapping and routing Man, I am dying for that because it sucks It’s bad I mean, I can’t tell you how many times I try to navigate somewhere and it takes forever to do it and then it gives me some really, really bizarre route that doesn’t make any sense Fire open Waze and it has the quickest, fastest way by far So, yeah, yeah, I don’t know, I hope so soon I know Elon tweeted about it, but there’s nothing that I’ve actually seen Hey Devin (chuckles) What should be a fair price after the depreciation of an EV? I don’t know, that’s a loaded question Um, yeah, I can’t speak to that, I don’t know What should be a fair price? It really, really depends on a lot of things, so I would say check out autolist.com, they’ve actually done some studies on this Thanks for the question Franz asks, the possibility of being trapped in the back seat of the model 3 due to no way to open the rear doors if power off was a turn off to my wife Don’t blame her If having children in the back car seats, how can adult alongside get out in a hurry? Well, if you can open it from the outside, that’s one thing, but I’m not sure about from the inside Yeah, no I agree, that was something I learned after the fact, and it was like, oof, that’s kind of interesting And just to be clear, the reason I got my model 3 is to share that experience with you guys We wanted to go all electric Me and my wife developed this thing a couple years ago called our family sustainability plan, and a big part of that was having all electric cars and then solar and then home batteries I’m waiting on my home battery, it should be here this March Other than that, we’re there, so we have all electric cars, solar, and now we’re just waiting on the home battery, so for us, that was a thing Likely, what we’ll end up doing, again because this is now my full time job is making videos and sharing those experiences with you, we’ll get another model 3, the performance one when it comes out, we’ll get a model Y, et cetera, et cetera, but for the ones we’re actually going to keep, this could be a deal breaker for me as well because that’s pretty scary Obviously it’s not something that, I don’t want to live my life in fear, but this seems like something that could have been easy to add, but for whatever reason wasn’t Yeah, and with my two and a half year old, I can’t really teach him how to grab a center punch and break the window or something, it doesn’t make sense

I agree, I agree Definitely confusing why it is the way it is Carlos asks, I’ve been waiting on the base model 3, waiting time second quarter, yeah, yeah, yeah Is there a question here? Pretty clear they’re holding the production-based model, I understand Yeah, it’s all about, nope, that is the business practice Yeah, as far as the tax credit goes, you’re definitely not going to get the full credit Anybody that’s getting the base model 3 will not get the full credit Just flat out, that’s just how it is You have to buy the more expensive one first, and that’s exactly how they did the model S and model X I don’t think it’s any surprise I think a lot of people that are unfamiliar with Tesla, that this is their first kind of introduction to them, as you’re pointing out, are upset about it, but really, I mean I guess it’s just how it is Which is why, again, for somebody that’s getting a free Roadster, I predict I’ll get it five years after they start making them, because why are you going to give the guys that didn’t pay a dollar for it first? Right, doesn’t make any sense Yeah, yeah, it’s a bummer, but they, that’s economics, that’s how it works Wendell asks, truly appreciate all the info you provide us for EVs You’re welcome Disappointed in the delay, yep, understandable Which is better, opening the windows and increasing the drag on the car or running the air conditioner? Huh, that’s a really good question Well, the air conditioner doesn’t use the motor, so it just uses a different motor essentially, and I don’t think it even uses the car battery, I think it uses the 12 volt battery Yeah, I would have to go that Well, obviously, the AC shouldn’t affect the drag on the car at all, but yeah, I would go in terms of efficiency, I would go running the AC with the windows closed would probably, but again I’m not an engineer in that sense, so yeah Thanks for the support and thanks for the question Let me just double check if there’s any down here with, okay, we’ve got like a hundred questions coming in We’re going to limit it to just about three more questions here Jeremiah asks, supply chain issues seem to be a huge problem for Tesla I don’t think it’s the supply chain, it’s the battery modules at the Gigafactory The model X was a manufacturing nightmare, yep Why aren’t there weekly updates? Yeah, I don’t think, there were some issues for suppliers, but I believe that they’ve solved those Really, the main thing is the battery assembly at the Gigafactory according to Elon from today’s statement Why? I don’t know Because each car is different and they’re trying to do something that’s not been done before It’d be one thing if they just copied the template from before, but each time they do this, they’re trying to push the limits and make something even better Even the model Y, if you’re unfamiliar, has something called a flex circuit, which should significantly reduce the amount of wiring needed in the car, which again, could make it simpler to manufacture There’s so many things Every time they do something, they’re trying to push it to the next level, instead of just kind of doing what they did before I mean, you have to kind of respect that The model X and model 3 are completely different things in terms of the issues they had The model 3, they’ll figure out for sure, but it’s just a little bit later, and it has to do with the automation of the battery assembly which Elon said that they felt that they knew how to do, but they were a little bit complacent in Yeah, thanks for the question, Jeremiah, it’s a good one If the model S and model X are supposed to be Tesla’s flagship cars, why does the model 3 user interface have so many features that the flagships do not? I don’t know what you’re talking about The model 3 user interface is garbage right now compared to the S and the X It’ll make it better Namable trip meters, speed adjustable volume Yeah, no, no, the UI on the 3 is garbage compared to the S and the X, sorry I completely disagree Tyler asks, hey Tyler Your estimate is, was 15 years on Elon time, estimate three to six months Yeah, full self driving, yeah, yeah, yeah, yeah No, definitely not revising that I’ve sat with and talked to several engineers that work on self driving for major auto manufacturers They all agree, level five autonomy is 15 years out at best And the thing is, is like we’re dealing with, I think people want to take something like the internet and how quickly those things developed and assume that the same thing will happen here but the problem is that we’re dealing with the physical world, and it is completely unreliable In fact, one of the teams that I sat with was from Mercedes, and they had this thing called the intelligent world drive, and what they did is they actually took their S class Mercedes, which is designed to be fully autonomous, and they took it to all the different continents, and they showed me some of the photos

and some of the data they collected, it is insane how many different types of roads and things that you have to interpret You can’t even fathom it And then, there’s stuff like in China, you may encounter pedestrians on the freeway And instead of stopping for a pedestrian, you swerve around them It’s really, really, the mountain to climb to get to level five autonomy is bigger than I think anyone is reporting That is why I am firm on that 15 years I think 15 years is even maybe a little aggressive I think it may be longer before we truly see complete autonomy Now, what we will see is, in the meantime, is things where we have known routes and good conditions where we see full autonomy in those specific use cases A good example is what Waymo is doing in Arizona We are dealing with, first off, in Arizona, the roads are fantastic They’re well maintained, and it’s going on specific routes, or in specific areas to be exact It’s not like this car is going off road, and figuring something out I just got back from Mexico, there’s not even road signs in a lot of the places I’m going to How the hell is a car going to know where to go? Doesn’t even have a clue on what it’s doing Kind of like what Elon alluded to with the coast to coast drive where they could have done it if they basically programmed in the specific route and everything that they knew they were going to encounter, but they didn’t want to do that In my estimate, we are miles and miles away from true full autonomy, and by that I mean no steering wheel in the car I know GM is kind of doing a funny stunt with the Bolt on that, but what I’m talking about is you can realistically, and it’s commonplace for us to just be like, why are people even allowed to drive? When is that question going to start, going to enter the public discussion? And I think that is so far out In the meantime, things like airport trams or things where it’s a known route and the conditions are good, easy, we can do that today, that does happen today, but that’s going to become very, very prevalent, I think The things like, I just hit a button and the car shows up and I hope in and it takes me out camping, yeah, that’s so far out, man I’m happy to be wrong Elon is definitely somebody that pushes the limits and I wish them all the best Don’t see it happening at all because there are so many factors that are not even close to being solved yet Not to mention if they’re doing it 100% with cameras instead of things like LIDAR, which Elon had a very good point about in the earnings call, they won’t be able to see through things like fog and rain and snow and stuff like that without those sensors Yeah, there’s so, so much to do here I love where we’re headed, I’m just, I’m happy for it to be slow progress, and I think people are just overemphasizing it because maybe the media or they assume it’s similar to how the internet developed which, the digital world is completely different than the physical world Sorry for the tangent there I’m sorry, you actually did have a question, my bad Will that make you rethink recommending holding off on getting it at purchase? Uh, no, no Again, I certainly won’t have the car I have now by the time it’s ready I wouldn’t worry about it I would not purchase full self driving at all I think you’re basically hedging a bet and you’re giving them $3,000 to play with I think you can do a lot better with that money on your own Thanks for the question, Tyler All right, guys, last one Tesla model 3 gets official EPA rating of 310 What’s the real rating after your use? You know, I haven’t tested it fully I am going to do a test like that to see, but there’s so many factors here I believe that the EPA actually rated it higher than 310, and 310 is what Tesla reports And inside of the API, it actually has some different things, there’s like the ideal range, the rated range, and then your actual range, and that’s how we measure efficiency Yeah, stay tuned, ’cause I’m going to be reporting on that very soon Okay, guys, thanks for joining me today on the broadcast (sneezes) Excuse me, live If I didn’t get to answer your question, I apologize I will be doing this again next week so you can get on the email list and make sure to get your question early, ask for votes, get people on there so that we make sure to cover it Lastly, don’t forget, when you free the data, your mind will follow Thanks for watching, guys, and I’ll see you back here next time Cheers