1. # 特斯拉

Elon Musk:Model Y 或将在 2022 年成为全球最畅销车型

特斯拉 2021Q1 财报电话会议纪要总结,附英文原文

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  • 特斯拉 2021Q1 表现创下新纪录,需求前所未有的强劲。Q1 特斯拉经历了有史以来最大的供应链挑战,芯片短缺。
  • Elon Musk:Model 3 上市 3 年半,已超过 BMW 3 系成为全球同级别轿车销量最高车型。同时,Model Y 大概率将在 2022 年成为全球销量最好的车型,不仅仅是电动车或 SUV 细分市场,而是所有车型里最畅销的。
  • 团队正在推进 FSD beta,FSD 的发展需要大量数据。全自动驾驶所需要的是全视觉方案而非雷达。
  • Model S/X 改款有挑战,五月或将提升产能。
  • 按照计划,新 Model X 将在 2021Q3 提产,预计每周 Model S/X 产能可达 2,000 台。经过调控,Model S/X 成本不高。柏林超级工厂和得州超级工厂明年有望规模投产。
  • 特斯拉削减了其比特币投资 10% 的头寸,盈利 2.72 亿美元。

散户提问:

关于 Dojo

Musk 表示:「在硬件和能源使用成本方面,Dojo 都是我们能够采取的最优解。如果其他人也想使用 Dojo,特斯拉可以公开使用权限。」

关于太阳能屋顶:

太阳能电池板和太阳能屋顶须与 Powerwall 绑定,安装确实存在一定难度,需要根据用户实际情况调整电池板和太阳能屋顶的安装。Musk 重申太阳能屋顶相关产品对于电动车家用充电的重要性。

关于虚拟货币:

Zachary Kirkhorn 回答了问题,重申特斯拉对于比特币投资持乐观态度,并将继续支持比特币支付购买特斯拉。Kirkhorn 表示,对于特斯拉而言,比特币是绝佳的现金储备方式。

关于美国得州车祸

Musk 表示主流媒体的报道多有不实。据车辆工程副总裁 Lars Moravy 称,特斯拉正在与得克萨斯州当局合作处理这一事故,并与当局合作进行研究调查,发现事故车的方向盘发生了变形,在事故发生时有人坐在驾驶座上,且当时车上所有安全带都为解开状态。

机构提问:

关于产能

Musk 表示人们依旧无法理解量产有多难,「原型车是像过家家,量产可太难了。(Prototype is child play, production is haaaaard.)」。

分析师提问:

关于 4680 电池及其产能

Musk 回答道特斯拉有一个小型的 4680 电池实验工厂,年产能 10 GWh,但目前特斯拉认为现在产出的 4680 还不足以直接应用在车上,但距离目标已不远,大约还需一年或一年半可量产。特斯拉已经为柏林和奥斯汀工厂订购了相关设备。同时也希望能够与现有供应商(宁德时代、LG 和松下)一起提升 4680 产能。

以下为电话会议英文原文:

Tesla, Inc. (NASDAQ:TSLA) Q1 2021 Earnings Conference Call April 26, 2021 5:30 PM ET

Company Participants

Martin Viecha - Senior Director, Investor Relations

Elon Musk - Chief Executive Officer

Zachary Kirkhorn - Chief Financial Officer

Lars Moravy - Vice President, Vehicle Engineering

Andrew Baglino - Senior Vice President, Powertrain and Energy Engineering

Conference Call Participants

Pierre Ferragu - New Street Research

Rod Lache - Wolfe Research

Dan Levy - Credit Suisse

Operator

Good day, ladies and gentlemen, and thank you for standing by. And welcome to the Tesla First Quarter 2021 Results and Q&A Webcast. At this time, all participants are in a listen-only mode. After the presentation, there will be a question-and-answer session. Please be advised that today’s conference is being recorded. (Operator Instructions)

I would now hand the conference over to your speaker today, Martin Viecha, Senior Director of Investor Relations.

Martin Viecha

Thank you, Carmen, and good afternoon, everyone. And welcome to Tesla’s first quarter 2021 Q&A webcast. I am joined today by Elon Musk; Zachary Kirkhorn and a number of other executives. Our Q1 results were announced at about 1 p.m. Pacific Time and the update deck we published at the same link as this webcast.

During this call, we will discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC.

During the question-and-answer portion of today’s call, please limit yourself to one question and one follow up. (Operator Instructions)

But before we jump into Q&A, Elon has some opening remarks. Elon?

Elon Musk

Great. Thank you. So Q1 2021 was a record quarter on many levels. Tesla achieved record production, deliveries and surpassed $1 billion in non-GAAP net income for the first time. We have seen a real shift in customer acceptance of electric vehicles and our demand is the best we have ever seen. So this is -- we are used to seeing a reduction in demand in the first quarter and we saw an increase in demand that exceeded the normal seasonal reduction in demand in Q1.

So Model 3 became the best-selling mid-sized premier sedan in the world. In fact, I should say, the best-selling luxury sedan of any kind in the world. The BMW 3 Series was for the longest time best-selling premium sedan. It’s been exceeded by the Tesla Model 3 and this is only three-and-a half years into production and with just two factories.

For Model 3 to be out selling its combustion engine competitors, I think, this is quite remarkable. In the past couple of quarters, we delivered roughly $0.25 million Model 3s, so -- which translates in an annualized rate of $0.5 million per year.

When it comes to Model Y, we think Model Y will be the best-selling car or vehicle of any kind in the world, and probably, next year. So I am not 100% certain of next year, but I think that it’s quite likely. I’d say more likely than not that in 2022 Model Y is the best-selling car or truck of any kind in the world.

Then with regard to Full Self-Driving, Full Self-Driving is great and its make great progress. This is definitely one of the -- I think, one of the hardest technical problems that exists that has maybe ever existed.

And really, in order to solve it, we basically need to solve a pretty significant part of artificial intelligence, simply real-world artificial intelligence. And that I -- that sort of AI, no necessary to compressed into a fairly small computer, a very efficient computer that we have designed but nonetheless, a small computer that’s using on the order of 70 watts or 80 watts.

So this is a much harder than if you were to use, say, 10,000 computers in a server or something like that. This is going to fit into a smaller screen. And this -- I think with the elimination of radar, we are finally getting rid of one of the last questions.

Radar was really -- it was making up for some of the shortfalls in vision, but this is not good. You actually just need vision to work and when it works, it works better than the best human because it’s like having eight cameras. It’s like having eyes in the back of your head the size of your head and three eyes at different focal distances looking forward. This is -- yeah -- and processing it at a speed that is super human.

There’s no question on my mind with a pure vision solution. We can make a car that is dramatically safer than the average person. So, but this is a hard problem because we are actually solving something quite fundamental about artificial intelligence. We basically have to solve real-world vision AI.

And yeah, so, and the key to solving this is also having some massive dataset. So, just having well over a million cars on the road that are collecting data from very sort of corner-case rare situations, sort of like data so many weird things in the world like a truck carrying a truck or a car with a -- one example is a car. This is an actual example.

A car with a kayak on the roof where the kayak has a little weight dangling from the front of the kayak in front of the car, and yet the car must ignore this and just look at the road. So it’s really quite tricky. But I am highly confident that we will get this done.

So, yes, this quarter I think we will continue to see that a little bit in Q2 and Q3. So Q1 was -- had some of the most difficult supply chain challenges that we have ever experienced in the life of Tesla.

Insane difficulties with the supply chains with parts -- over the whole range of parts. Obviously, we were upset about the chip shortage. This is a huge problem. But then in addition to that, for example, we had quite a difficulty scaling -- driving production in China, because we are unable to get critical engineers there because of COVID quarantine restrictions.

So which meant that Tesla worldwide was dependent on drive units made in our factory in Nevada taking that. And so I thought that was a very challenging situation. I think we are mostly out of that particular problem. But those are just two of many challenges. So the team did an incredible job of dealing with really severe supply chain shortages.

So with respect to Model S and X, there were more challenges than expected in developing the Plaid Model S or call it the Paladium program, which got the new version of the Model S and X, which has a revised interior and new battery pack and new drive units and new internal electronics and has resembled a high-station level infotainment system.

There are just a lot of issues encountered ensuring that the new factory was as more super safe that was quite hard, it was little more actually (inaudible). So it took quite a bit of development to ensure that the battery of the new S/X is safe.

Then, we are trying to get (Audio Gap) in the car slowly for the past few months. But we are just stacking them up in the yard and just making refinements to the cars that we have built. But we do expect to ramp Model S production and start delivering them probably next month. So -- and then to be in sort of fairly high volume production for the S in Q3 and to start delivering the Model X in Q3 as well.

So I think as we ramp up I think probably the demand for the new S/X will be quite high. So surely it’s going to be a question of ramping supply chain and internal production processes. So probably we are -- like we are going to aim to produce over 2,000 S/X per week, perhaps, if we get lucky, upwards of 2,400 or 2,500.

This again is contingent on global supply chain issues, which just a lot of factors outside of our control here. But I do think we -- this will get solve, it’s just a matter of time, and then we will be doing well over 2,000 S/X per week. It actually costs us less to produce, a little bit less to produce. But it is a superior product.

So in conclusion, there’s a lot to be excited about in 2021 and 2022. We are building factories as quickly as we can. Both Texas and Berlin are progressing well and we expect to have initial limited production from those factories this year and volume production from Texas and Berlin next year.

And at this time, we will continue to ramp production of Model Y in three months in Shanghai. In the background, we are continuing work -- development work on the Semi, Cybertruck, on the Roadster and other products.

Thanks to everyone at Tesla who have made this year a huge success.

Now on to questions.

Martin Viecha

Thank you very much. We have some remarks from Zachary Kirkhorn as well.

Elon Musk

Okay.

Zachary Kirkhorn

Yeah. Thanks, Martin. Thanks, Elon. So congratulations to the Tesla team on breaking multiple records in the first quarter of 2021, as Elon had mentioned, which is typically the most difficult of the year for many reasons.

To summarize the quarter, I think, it’s best understood by three key items. First, we successfully launched and began the ramp of Model Y in Shanghai, achieving positive gross margin in the first quarter of production and receiving a great reception from the market.

Second, as Elon mentioned, although we began the production process for the Model S during the quarter, we had not yet begun customer deliveries. The reduction in Model S and X deliveries from Q4 to Q1 were a meaningful headwind to free cash flows and profit generation.

For example, we incurred an estimated $200 million of direct P&L impact relating to this program in Q1, the majority of which is reflected in COGS and that’s before even considering the impact of lost revenue and profits as a result of the transition. And as Elon mentioned, we expect the first deliveries to begin shortly.

Third, as we continue to work through the instability of the global supply chain, particularly around semiconductors and port capacities. While the Tesla team in partnership with our suppliers did tremendous work keeping our factories running, we did experience high expedite costs in the quarter and they were also higher than they were in Q4, with some minor interruptions to production over the course of the quarter. We believe that this landscape is improving, but it does remain difficult and it’s an evolving situation.

If we double click within net income, auto gross margin excluding credits improved sequentially and year-over-year. This is in spite of the costs mentioned for SNX and expedites and a reduction in global ASPs as our cost structure as a company is reducing at an even faster pace. So as we look out over the course of the year, we feel optimistic about our gross margin strength, particularly as some of these headwinds we are experiencing start to be resolved.

On Services and other margins, these have recovered and are trending towards profitability, aided by strength in the used car business, operational improvements in service and additional service revenue opportunities that help absorb fixed overheads.

On energy gross margins, these remained negative for a second quarter. This was driven by Solar Roof-related ramp costs and winter seasonality in the lease BPA business. We continue to manage through a multi-quarter backlog on Powerwall. We are working as fast as we can to increase production and this will aid in profitability of this business as those volumes increase.

On operating expenses, these increased for Q1, which was driven by our investments in technology and growth. In particular for R&D, this includes the structural battery pack and 4680 cells, investments in the new SNX, and our neural net and silicon investments.

On the SG&A side, we are setting up infrastructure and support for both China and EMEA in anticipation of volume to come there. And as I have said before, our plans show that we remain on track for sustained industry-leading operating margins.

Double clicking on cash flows, we continue to generate positive free cash flows and this was despite the significant working capital headwinds from SNX. Additionally, we are making progress reducing various forms of debt.

We also invested $1.5 billion in Bitcoin during the quarter, then trimmed our position by 10%, which contributed to a small gain in our Q1 financials. Taking a step back, we have generated $8 billion in operating cash flows and $4 billion in free cash flows over the past four quarters.

As we look forward, our plans remain unchanged for long-term growth of 50% annually and we believe we are on track to exceed that this year as we guided to last quarter. Global demand remains meaningfully higher than production levels, and so we are driving as fast as we can to increase our production rates.

As we think about Q2 and Q3, these quarters should largely be driven by execution on SNX, as we have discussed, continued ramp of Model Y in Shanghai and the associated cost reductions of these programs, and we expect profitability and cash generation to evolve over the course of the year in line with those improvements.

And then as we get towards the end of the year, our story will pivot towards the launch and ramp of our newest factories in Austin and Berlin. So there’s certainly no shortage of exciting things for us to work on and look forward to.

Thank you and we will open it up for questions.

Q&A Session

A - Martin Viecha

Thank you very much. And we will first take a retail questions from, say, our website. The first question is, how is how is Dojo coming along? Could Dojo unlock an AWS-like business line for Tesla over the next few years?

Zachary Kirkhorn

I will jump in here. So with respect to…

Elon Musk

Sorry about that. My apologies. I was on mute.

Zachary Kirkhorn

Go ahead, Elon.

Elon Musk

So, yeah, so it’s basically saying that the, like, right now people think of Tesla has -- a lot of people think Tesla is a car company or perhaps an energy company. I think long-term people will think of Tesla as much as an AI robotics company as we are a car company or an energy company.

I think we are developing one of the strongest hardware and software AI teams in the world and so we appear to be able to do things with Self-Driving that others cannot. So and if you look at the evolution of what technologies we have developed, we developed them in order to solve the problem of Self-Driving.

So we couldn’t find a powerful enough neural net computer, so we designed and built our own. The software out there was really quite primitive for this task and so we built a team from scratch and have been developing what we think is probably the most advanced real-world AI in the world.

And then it sort of makes sense that this is kind of what needs to happen because the road system is designed for a neural net computer, our brain. Our brain is a neural net computer. And it’s -- the entire system is designed for vision with a neural net computer, which is because it’s designed for eyes and a brain.

And so if you have a system which has very good eyes, you can see in all directions at once and see three focal points forward, it never gets tired. It’s never texting, it has redundancy and its reaction time is super-human. Then it seems pretty obvious that that such a system would achieve an extremely high level of safety, far in excess of the average person. So that’s what we are doing.

Then Dojo is kind of the training part of that. So because we have over a million cars and perhaps next year we will have 2 million cars in active use providing vast amounts of video training data that then needs to be digested by a very powerful training system.

And currently, we use Tesla training software. We drew up a lot of training software, a lot of labeling software to do -- be able to do surround video labeling, which is quite tricky. This means all eight cameras simultaneously at 36 frames per second per camera labeling video over time. It wasn’t any tool that existed for this. So we developed our own labeling tool.

Then taking it a step further, obviously, the Holy Grail is order labeling. So now we are getting quite good at order labeling where the trainers train the training system and then the system order labels the data and the label -- the human laborers just need to look at the labeling to confirm that it is correct and perhaps make edits. And then every time an edit is made, that further trains the system. So that’s kind of like a flywheel that’s just sort of spinning up and really the only way to do this is with vast amounts of video data.

So then we need to train this efficiently. So Dojo is really -- it is a supercomputer optimized for neural net training. We think Dojo will be probably in order of magnitude more efficient on, say, show what the exact right metric is, but say per frame of video, we think it will be an order of magnitude more cost efficient in hardware and in energy usage per frame of video compared to a DPU-based solution or compared to the next best solution that we are aware of.

So then possibly that could be used by others. It does seem as though over time, I mean, just an observation, I think, I will basically step back that neural net-based computing or AI-based computing is more and more of the compute stack.

We are -- conventional computing is called perhaps (inaudible) based computing. It’s still going to be important, it’s still going to be very important, but it will become -- but neural net will become a bigger and bigger portion of compute. So anyway, long story, but I think, probably, others will want to use it too and we will make it available.

Martin Viecha

Thank you very much. Let’s go to the second question from retail investors. The recent price changes on Solar Roof have been a bit discouraging for customers and investors. Could Tesla share more about Solar Roof challenges and if the outlook has changed at all, i.e. 1,000 roofs per week?

Elon Musk

Yeah. First of all, I should say, the demand for the Solar Roof remains strong. So despite raising the price, the demand is still significantly in excess of our ability to meet the demand to install the Solar Roofs. So production has gone fine, but we are choked at the installation point.

We did find that we basically made some significant mistakes in assessment of difficulty of certain roofs, but the complexity of roofs varies dramatically. Some roofs are literally two times or three times easier than other roofs. So, you just can’t have a one size fits all situation.

If a roof has a lot of protuberances or if the roof sort of the core structure of the roof is rotted out or is not strong enough to hold the Solar Roof, then the cost can be double, sometimes three times what our initial quotes were.

So in those cases, what we obviously have to do is to refund customers their deposit. What we cannot do is go and just lose a massive amount of money. We have just got to provide a refund of the deposit.

But what is I think most important about the Solar Roof situation, which I tweeted about this past week, is that we are shifting the whole solar situation, the solar power, basically the solar factory situation to, there’s only one product basically, there’s only one configuration every house, but we will not sell a house solar without a Powerwall.

That solar could either be solar retrofit with conventional panels put on the roof or it can be the Tesla Solar Glass Roof. But in all cases, it will have the Powerwall to temporary this -- and this is essentially the Powerwall to a plus if you will, the plus refers to a higher peak power capability. So basically, all Powerwalls made since roughly November of last year have a lot more peak power capability than the specification on the website.

They are about twice the power capability, roughly. It depends on how you count power, but about twice the peak power and about oddly twice the steady-state power of the specification on the website. The energy is the same but the power is roughly double.

And all installations will have a Powerwall and the difficult the installation will dramatically increase -- or the difficulty of the installation will be much less, it will be much easier, because the power from the Solar Roof, the Solar Glass Roof, or the solar panels, will only ever go directly into the Powerwall.

And the Powerwall will only ever go between the utility mains, right, between the utility and the main power panel of the house, which means you never need to touch the main circuit breakers of the house. You never need to touch the house circuit breakers.

Effectively almost every house, therefore, looks the same electrically instead of being a unique work of art and requiring exceptional ability to rewire the main panel. So this is extremely important for scalability. It’s the only way to do it, really.

And this also means that every solar Powerwall installation that the house or apartment or whatever the case may be, will be its own utility. And so even if all the lights go out in the neighborhood, you will still have power. So that gives people energy security. And we can also, in working with the utilities, use the Powerwalls to stabilize the overall grid.

So let’s say like if there was a -- like there was in Texas. There was a peak power demand and that peak power demand, because the grid lacked the ability to buffer the power, they had to shutdown power. There’s no power in storage. No good form of power storage.

However, with a whole bunch of Powerwalls at houses, we can actually buffer the power. So if the grid needs more power, we can actually then with the consent, obviously, of the homeowner and the partnership with the utility, we can then actually release power on to the grid to take care of peak power demand.

So, effectively, the Powerwalls can operate as a giant distributed utility. This is profound. I am not sure how many people will actually understand this. This is extremely profound and necessary, because we are headed towards a world where, as we just talked about earlier, where people are leaning towards electric vehicles. This will mean that the power needs in -- at homes and businesses will increase significantly. We will need -- there will need to be a bunch more electricity coming somewhere.

In fact, if you go full renewable electricity, we need about three times as much electricity as we currently have. So these are rough numbers, but you roughly need twice as much electricity if all transport goes electric and then you need three times as much electricity if all heating goes electric.

So basically, this is a prosperous future, I think, both for Tesla and for the utilities, because -- and in fact -- and this will be very -- if this is not done, utilities will fail to serve their customers. They won’t be able to do it. They won’t be able to react fast enough.

And we are going to see more and more of what we see in California and Texas of people seeing brown-outs and black-outs, and the utilities not being able to respond, because there’s a massive change going on with the transition to electric transport and we are seeing more extreme weather events. This is a recipe for disaster. So it is very important to have solar and batteries at the local level at the house.

In addition, it is important to have large battery storage at the utility level so that solar and wind, which are the main forms of renewable electricity can be -- that electricity can be stored because sometimes the wind doesn’t blow. Sometimes it blows a lot. Sometimes it blows too much and at times it doesn’t blow enough.

But if you have a battery, you can store the energy and provide the energy to the grid as needed. The same goes for solar because, obviously, the sun does not shine at night and sometimes it is very cloudy.

And so by having battery storage power with solar and wind, this gives the long-term solution to a stable energy future, and as I said, especially each both at the local level and at the utility level. If it doesn’t occur at the local level, what will actually be required is a massive increase in power lines, in power plants, as they would have to put long distance and local power lines all over the place. They will have to increase the size of the substations. It’s a nightmare. This must occur. There must be solar plus battery. It’s the only way. So, yeah.

Martin Viecha

Thank you very much. And the next retail question is, Master of Coin, can you tell us anything about Tesla’s future plans in digital currency space? Or when any such major developments might be revealed?

Zachary Kirkhorn

Sure. Thanks, Martin. So as I noted in our opening remarks and we have announced previously, so Tesla did invest $1.5 billion into Bitcoin in Q1 and then we subsequently sold a 10% stake in that. We also allow customers to make vehicle deposits and final vehicle purchases using Bitcoin.

And so where our Bitcoin story began, maybe just to share a little bit of context here. Elon and I were looking for a place to store cash that wasn’t being immediately used, trying to get some level of return on this but also preserve liquidity.

Particularly as we look forward to the launch of Austin and Berlin, and uncertainty that’s happening with semiconductors and port capacity, being able to access that cash very quickly is super important to us right now.

And there aren’t many traditional opportunities to do this or, at least, that we found and in talking to others that we could get good feedback on, particularly with yields being so low and without taking on addition risk or sacrificing liquidity.

And Bitcoin seemed, at the time, and so far has proven to be a good decision, a good place to place some of our cash that’s not immediately being used for daily operations or maybe not needed until the end of the year and be able to get some return on that.

And I think one of the key points that I want to make about our experiences in the digital currency space is that there’s a lot of reasons to be optimistic here. We are certainly watching it very closely at Tesla, watching how the market develops, listening to what our customers are saying.

But thinking about it from a corporate treasury perspective, we have been quite pleased with how much liquidity there is in the Bitcoin market. So our ability to build our first position happened very quickly. When we did the sale later in March, we also were able to execute on that very quickly.

And so as we think about kind of global liquidity for the business and risk management, being able to get cash in and out of the markets is something that I think is exceptionally important for us.

So we do believe long-term in the value of Bitcoin. So it is our intent to hold what we have long-term and continue to accumulate Bitcoin from transactions from our customers as they purchase vehicles.

Specifically, with respect to things we may do, there are things that we are constantly discussing. We are not planning to make any announcements here. We are watching this space closely. So when we are ready to make an announcement on this front, if there’s one to come, we will certainly let you all know.

Martin Viecha

Thank you. And the fourth question from retail investors is, does Tesla have any proactive plans to tackle main stream media’s imminent massive and deceptive click bait headline campaigns on safety of Autopilot or FSD, perhaps a specialty PR job of some sort?

Lars Moravy

Well, I will take this one, guys. From the safety side, I continue to say, he is driving on too.

Elon Musk

Yeah.

Lars Moravy

Go ahead, Elon.

Elon Musk

No. Please go ahead. I think, just with -- just going through the facts of what I mean, specifically, there were -- there was an article regarding a tragedy where there was a high speed accident in Tesla and it was really just extremely deceptive media practices where it was claimed to be Autopilot, which is completely false and those journalists should be ashamed of themselves. Please go ahead, Zach.

Lars Moravy

Yeah. Thanks, Elon. So I was just saying, we are committed to safety in all our designs and that’s number one in what we do here. Regarding the crash in Houston, specifically, we worked directly with the local authorities and NTSB, so wherever applicable and whenever they reach out to us for help directly on the engineering level and whatever else we can support.

In that vein, we did a study with them over the past week to understand what happened in that particular crash and what we have learned from that effort was that Autosteer did not and could not engage on the road condition that as it was designed.

Our adaptive cruise control only engaged when the driver was buckled and above 5 miles per hour, and it only accelerated to 30 miles per hour with the distance before the car crashed. As well, adaptive cruise control disengaged the car fully to complete to a stop when the driver’s seat belt was unbuckled.

Through further investigation of the vehicle and the accident remains, we instructed the car with NTSB and we saw in the local police and were able to find that the steering wheel was indeed deformed, so it was leading to a likelihood that someone was in the driver’s seat at the time of the crash and all seat belts post-crash were found to be unbuckled.

We were unable to recover the data from the SD card at the time of impact, but the local authorities are working on doing that and we await their report. As I said, we continue to hold safety in a high regard and look to improve our products in the future through this kind of data and other information from the field.

Martin Viecha

Okay. Thank you very much. Let’s go to the next question from institutional investors. The first question is, proponents of alternative grid storage technologies claim that lithium ion is unsuited to long-term storage at scale due to vampire drain. Could 4680 cells address this limitation? Is the limitation even relevant for changing the energy equation?

Lars Moravy

Yeah. Just let me jump in on the vampire drain. That’s definitely not the issue. Good lithium ion cell self-discharges less than 0.001% of its energy per day, so the vampire drain is maybe not…

Elon Musk

Myth.

Lars Moravy

Yeah.

Elon Musk

As mythical as vampires.

Lars Moravy

Yeah. I think the challenge with seasonal storage is, your value proposition drops from hundreds of utile [ph] full cycles per year to less than maybe 10 or less maybe even less than five cycles per year. So it’s just a different type of technology altogether that would make sense, given that it’s more than an order of magnitude different use case.

Elon Musk

Yeah. We have got a long way to go before we are dealing with seasonal technology issues. But certainly a way to deal with seasonal technology would be to have wind and solar already on the site of more southerly latitudes and the -- but then across a variety of longitudes.

So essentially, let’s say in the U.S., for example, if there was -- I am not sure if Phil understands that you can actually power the entire United States with just sort of a hundred, roughly 100 mile -- by 100-mile grid of solar. Sometimes people don’t quite understand, how much solar is needed to power the United States?

Almost nothing of these can be substantially required by this and it is true of almost any country in the world. The solar incidence is a gigawatt per square kilometer. This is insane. In fact, if you took the clear area, just the area, say, for nuclear power plants, the area that is considered not useable because a nuclear power plant is there. In most cases, if you just put solar there it would generate more power than the nuclear power plant, because they typically have pretty wide clear areas.

And --so it really -- so if you have say 25% efficient solar panels and then those are 80% efficient in how they are laid out, you are going to do about 200 megawatts per square kilometer. Therefore, 5 square kilometers is a gigawatt, which might be typical sort of power plant. It’s really not much area at all and a lot of places can have wind and solar put in place.

So anyway, it’s entirely possible to power all of earth with a small percentage of earth’s area and then to transfer that power through high voltage DC lines. No new technology. No -- you don’t need like room temperature super conductors. This is a total also another myth. Room temperature super conductors almost irrelevant, in my opinion, almost irrelevant. Low cost, long distance power lines using copper or aluminum is very important.

So heating is I square R. So that’s current squared to times resistance. So as you increase voltage, you can drop the current dramatically and drop the heating dramatically to a point where it is of minor relevance. Like maybe you lose 5% to 7% with a high voltage DC power line. Something like that.

So I want to be clear. No, this is not certain. No new materials are necessary. We just need to scale this thing up. We -- the technology exists today to solve renewable energy. And some people say, well, why don’t we do it? That’s because the energy basis of the earth is gigantic, super mega insanely gigantic.

So you can’t just go and do a zillion terawatts overnight. You have got to build the production capacity for the cells, for the battery cells, for solar cells. You have got to put that into vehicles. You have got to put that into stationary storage packs. You have got to put that it into solar panels and Solar Glass Roofs and you have got to deploy all of this stuff.

But it’s certainly the case that we can accelerate this and we should try to accelerate it. And the right thing to do I think from an economic standpoint and I think almost any economist would agree is to have a carbon tax, just as we have a tax on cigarettes and alcohol, which we think are more likely to be bad than good and we tend to tax fruit and vegetables less.

But the same should be true. We should tax energy that we think is probably bad and support energy that we think is probably good. Just like cigarettes and alcohol. Just like fruits and vegetables. It’s just common sense.

And on the plus side, I am not suggesting anyone be complacent. But sustainable energy, renewable energy, will be sold. It is being sold, but it matters how fast we sell this and if we sell it faster, that’s better for the world.

Martin Viecha

Thank you very much.

Elon Musk

There’s no question in my mind whatsoever that the energy storage problem can be solved with lithium-ion batteries, zero. I want to be clear, zero. I think the bias will tend to be towards iron-based, lithium-ion cells. I will say, lithium-ion, people think lithium must be a big constituent of the cells. It’s more like 1% to 2% of the cell is lithium. The main part of the cell is the cathode. The main mass and cost in the cell is the cathode.

For high energy cells, like, for example, what we use in most Teslas, have nickel-based lithium-ion cells, which have higher energy density, longer range than iron-based cells. However, stationary storage, the energy density is not as important because it’s just staying on the ground and so I think the vast majority of stationary storage will be iron-based lithium-ion cells with an iron phosphate cathode, technically. But the phosphate part is unnecessary. It’s really just the iron or nickel.

I am assuming the terminology. Just think of it as iron and nickel and there’s an insane amount of iron in the world, more iron than we could have possibly used and there’s also more lithium than we could possibly use. Basically, there is no shortage of anything whatsoever in iron phosphate lithium-ion cells.

Martin Viecha

Thank you very much. Let’s go to the next question from institutional investors which is, you have suggested that between a 5x to 10x improvement is achievable in automotive production versus the first Model 3 line on a first-principles physics analysis. Where does Berlin sit relative to that limit?

Elon Musk

I think we are still quite far away from it. I mean, the thing to bear in mind with production is for those who have never done production, they just don’t understand how insanely hard production is.

I want to really be very, very emphatic here. Prototypes are trivial. They are child’s play. Production is hard. It is very hard. Now you say production at large scale with higher liability and low-cost, insanely difficult.

But what Tesla achieved on the automotive side was not to create an electric car. The truly profound thing on the car side is that Tesla was the first American car company to achieve volume production of a car in 100 years and not go bankrupt.

So this is -- this -- basically myself and NIO and Tesla had to basically have several aneurysms to get this done. It was so hard. You have no idea. So anyway, and the thing about making a large complex manufactured object is let’s say that you have a closer approximation 10,000 unique items. If even one of those items is slow, that sets your rate, just one. Isn’t that so trivial?

We have had a production stop because of carpet in the trunk. We had a production stop because of a USB cable. At one point for the Model S, the -- we literally raided every electronics store in the Bay Area for a few days there. Nobody could buy a USB cable in the Bay Area because we went and bought them all to put them in the car, literally. And there are like hundreds of stories like that.

So anyway, solving that, those constraints, and a logistics problem that makes World War II look trivial. I am not kidding. Like the scale is insane. We are talking millions of cars, massive global supply chain, 50 countries, dozens of regulatory regimes. It’s insane, so yeah.

Martin Viecha

Thank you. And the last question from institutional investor is, Master Plan Part Deux talks about an urban transport vehicle that is smaller than a traditional bus with greater areal density achieved by removing the central aisle. Do you have any update to share on that goal?

Elon Musk

Not at this time.

Martin Viecha

Okay. Thank you very much. So let’s move to analyst Q&A.

Operator

Thank you. First question is from Pierre Ferragu with New Street Research. Your line is open.

Pierre Ferragu

Hi, guys. Thanks for taking my question. I’d love to get actually the data on what you presented on the Battery Day. In the last six, seven months, I was wondering how much progress you have made on that front, first in terms of process development. So how are things coming together on your pilot line, are you getting to the kind of productivity throughput you are aiming for? And second, actually on your production ramps, I was wondering in which size you are ramping production capacity cells with 4680 cell and where you stand on ramping up that capacity as well? And I have a quick follow-up on energy rate as well.

Elon Musk

Well, so we have the -- I call it the Atlas, but we have a small cell power plant which is still big by normal standards. We expect to have like a 10-gigawatt-hour per year capability in Fremont, California and we have made quite a few cells.

We are not quite yet at the point where we think the cells are reliable enough to be shipped in cars, but we are getting close to that point. And then we have already ordered most of the equipment for battery production in Berlin and then electric for Austin, as well. So we are really down to the nitty-gritty on this. But overall, I think, we are still quite optimistic about achieving volume production of the 4680 next year.

Zachary Kirkhorn

Yeah. I think…

Pierre Ferragu

Thank you.

Zachary Kirkhorn

Yeah. I think, Pierre, just one thing I’d add is, there’s been a lot of questions about yield. Actually, I noticed people asking about that. The yield progress isn’t really strong and we were really still in Commissioning phases with most of the tools to the point that we were confident that the yield trajectory aligns with our internal cost projections. We did talk about yield also at Battery Day which is one of the reasons why it’s useful to check in on that.

It takes a while, as Elon just mentioned, to go from prototype to production and it’s not just parts, it’s processes, it’s equipment, but as we have matured the process equipment, we have gotten to where we need to be on the yield side.

Elon Musk

Yeah. And basically, this is just a guess because we don’t know for sure, but it appears as though we are about 12, probably, not more than 18 months away from volume production of the 4680. Now at the same time, we are actually trying to have our cell supply partners ramp up their supply as much as possible. So this is not something that is to the exclusion of suppliers. It is in conjunction with suppliers.

Zachary Kirkhorn

Yeah.

Elon Musk

So we want to be super clear about that. This is not about replacing suppliers. It is about supplementing suppliers. So -- and we have a very strong partnership with JBL, with Panasonic and LG.

And we would -- our request to our strategic partners for cell supply is, please supply us with as much as you possibly can. Provided the price is affordable, we will buy everything that they can make.

Zachary Kirkhorn

Yeah. Yeah. And specific to that, we are on track to more than double the supplier capacity over the next we think

Elon Musk

Yeah. We -- exactly. We do expect suppliers learn to receive double the cell output next year versus this year.

Pierre Ferragu

Okay. And I had a quick follow-up on -- maybe Zach for you on your Energy business. So I understand when I get to gross margin with Solar Roof ramp, but I was wondering, what do gross margin look like there when you look at the Storage business and where you -- what’s your ambition in terms of gross margin in that business? I guess it’s going to grow in the mix in coming years, so it’s important for long-term modeling?

Zachary Kirkhorn

Yeah. We are seeing a lot of -- no that is -- we are aiming for comparable margins in storage as in vehicles. But it is important to bear in mind that vehicle is more mature than storage. So we are already are active margins with the Powerwall, but some additional work is needed for the Megapack to achieve good margins. Andrew, what do you think?

Operator

Thank you.

Andrew Baglino

Yeah. Sorry. Just jumping in, Elon. Absolutely agree. Yeah. Powerwall is mature. We have been producing Powerwall 2 for three years now and we are at good margins there, but Megapack has more room to go to achieve our targets.

Elon Musk

We have a clear runway for improving the cost for the megawatt hours for the Megapack.

Andrew Baglino

Absolutely. Yes, we do.

Martin Viecha

Thank you. Let’s go to the next question, please.

Operator

From Rod Lache with Wolfe Research. Please go ahead.

Rod Lache

Hi, everybody. I was hoping maybe just first, you could talk a little bit about how you are thinking about the rollout of version 9 of SSD and the transition of the subscription models. It sounds like some of this is about to roll out next month. I am not sure if that’s just a subscription model. But maybe you could just spend a little time talking about how impactful you expect that to be.

Elon Musk

So go ahead, Zach.

Zachary Kirkhorn

Yeah. We are working on getting FSD subscription out. There’s a couple of internal technical dependencies. But from a business model perspective that’s aligned and we are hoping to roll that out soon.

The key thing that I say here, there’s a lot of potential for recurring revenue based on a FSD subscription. The -- if you look at the size of our fleet and you look at the number of customers who did not purchase FSD up front or on a leaf and maybe want to experiment with FSD, this is a great option for them.

One of the things we will need to keep an eye on is a potential transition from cash purchases of FSD subscription over to cash purchases of FSD who may move over to FSD subscription. And so there could be a period of time in which cash reduces in the near-term and then as the portfolio of subscription customers builds up, then that becomes a pretty strong business for us over time. But we are hoping to get this launched pretty soon and see what the response is to it.

Rod Lache

Okay. Great. And I was hoping, Zach, maybe you could just talk a little bit about OpEx. It was a noticeable increase, even excluding SBC, obviously, a lot going on this quarter. But can you maybe just talk a little bit about how we should be thinking about that going forward?

Zachary Kirkhorn

Sure. On the R&D side, you know what we are seeing, as I mentioned in my opening remarks, is kind of a convergence of a series of programs that are happening and our R&D OpEx spend kind of correlates to where we are in the product lifecycle in different programs.

And so we are kind of at the tail end of investments in what we call internally Paladium, which is the new Model S and Model X. And so we expect that to decrease over time, but it was high in Q1 for a lot of the reasons that Elon had mentioned.

We are also getting very heavy into 4680 development that Drew and team are working on and the associated structural battery pack that goes along with that. And so these are new technologies, not only new to Tesla, but new to the industry.

And so we are investing heavily there on an R&D side to work out those kinks. And spend along in those areas should continue over time as we continue to work through the development cycle of those.

Then I also mentioned, and Elon talked a bit about, Dojo and the potential there. So from neural net investments and custom silicon investments, these continue to be areas that we spend on and make investments in.

On the SG&A side, the business is pivoting very quickly to be global and China is ramping quite quickly. And we are trying to make sure that we are staying ahead of the volume, so that we have the right sales capacity, store capacity there, local investments and IT and others to manage the growth, such that as the growth comes, the execution challenges are smaller than maybe in similar periods of growth that we have seen in the past and so we are making investments there ahead of the growth.

And overall, as we look at OpEx as a percentage of revenue over the course of the year, we do expect to see a substantial drop from 2020 to 2021 as the volumes in the latter part of the year pick up.

Martin Viecha

Thank you. Let’s go to the next question, please.

Operator

Thank you. We have Dan Levy with Credit Suisse. Your line is open.

Dan Levy

Hi. Good evening. Thanks. Two questions. One is on COGS, I think, you have gotten from Battery Day a pretty good feel about the potential for COGS reduction related to Powertrain. But I’d like to get a sense of the path to reducing COGS ex-Powertrain as you would still need a meaningful reduction on that front to make the math work on a 25,000 vehicle. So what levers do you have to reduce in your cost ex-Powertrain, is it just more scale, better supply pricing or is it just based on ongoing cost reductions?

Elon Musk

I think all of the above.

Zachary Kirkhorn

Yeah. I mean, on the vehicle side, there’s plenty of opportunity as well. Obviously, building a car like a Model S is quite complex and has various moving parts. Model 3 and Model Y were steps of improvement in that.

But when you look at some of the other advancements that we are including in the Model Y, factories into Austin and Berlin, we have reduced the body pound by as much 60%. And the part costs money.

So we continue to find optimizations there as well as we get economies of scale. When we start to talk about the volumes, we are considering worldwide with four factories building the same vehicle. So both of those things on the vehicle side will improve our COGS as well and the Powertrain continues to be integrated into that.

Dan Levy

Great. And then just related, as we see Berlin and Austin ramp, I’d like to just get a sense on the comparison of Fremont versus the new capacity, obviously, Fremont is non-optimized because you bought the old NUMMI facility. You had to retrofit that to your need. So maybe you can give us a sense of how your new capacity is going to differ versus Fremont. What are the areas that you have efficiencies that you previously didn’t have and maybe how much does that add up to improved COGS over time to help you achieve that 25,000 vehicle?

Elon Musk

Yeah. We always talk too much about future product development. Earnings calls are not the right place for us to make a major product announcement, so yeah. We will get there. We will provide it later.

Martin Viecha

All right. Thank you very much. Unfortunately, this is all the time we have for today. Thank you very much for dialing in and for listening, and we will speak to you again in about three months. Thank you.

Elon Musk

Thanks. Thanks, everyone.

Operator

This concludes today’s conference call. Thank you for participating. You may now disconnect.

🔗信息来源:Seeking Alpha

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