Tesla (TSLA) 28 Jan 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to Tesla's Q4 2020 Financial Results and Q&A Webcast. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker, Mr. of Director Senior Viecha, Investor Relations. Martin ahead, go sir. Please

of everyone. Thank I'm fourth Tesla's and a joined afternoon you, good Welcome number and quarter Kirkhorn by Musk, to executives. Elon Sherry today Zachary other XXXX Q&A webcast.

X Our in Pacific at same the at webcast. this published Time link we P.M. as QX deck announced results the were about update

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

call, some During jump before to limit we yourself and opening the Instructions] the of one Elon Q&A, remarks. But question-and-answer into today's Elon? has please one portion question follow-up. [Operator

you. Thank

delivering to effort. just we of was an year almost Tesla for recap on our a incredible just as for again, environment, thank defining in and as XXXX million delivered the Despite milestone entire the reached we challenging us last So, to, people like year a cars X.X important produced an at history. cars. many We once levels. I'd many year, producing

XXXX. growth despite rate really So, incredible an a very and challenging

to such a with So, Tesla. my hat is off people great such at hard work

reached spending We and record cash full expenditures. and $X than more billion to after GAAP of flow and positive on in billion other addition -- So new income $X.X year, we cash operating achieved flow. nearly net building factories margins free industry-leading

sustainably, is it at the a which single all X the to largest capacity. ramp ever We Shanghai finish of rapidly. being full year. started it the top the -- to in one continues started single-piece that grow -- have lot in Area. focus where ramped casting Model history, of battery later almost this we for cell made. Bay piece being speed. third week plant, is we on reached is We're and a Berlin capacity start time cast to most this from the new ramped cars we Y production more year. vehicles. as start to advanced Y. producing entire the Model built -- while a the in we able Fremont to we despite factories and and be cell Giga plant. pilot production expect a would in even a single to Giga we're -- also We the We out on We execution, Texas, China for to expansion, pump Model lastly, machine a the and We And rear building X,XXX pilot factory in XX Shanghai our This a heat And earth it enough factory capacity built piece build and volume continue than large though in is is Regarding introduced -- its of the cell production first car probably model battery a to the of in -- the castings skeleton

and February. we're Model Model in are delivered -- production new we the the be to Model will X, announce super Regarding excited and the and new launching now S S X

and S a we'll delivering S X and month. delivered and will able X. in production we're be now, actually next been and little And S forward be February Model the to pad, later. in Model The we've So bring Model fab,

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been to sedan to that able XX. to in get have with X ever no a So seat seats. to to to luxury X third less X is seconds seconds, below This car is X people ability go the than the seven and production row will has XX able up

of car. nice. pretty sports on that it a two-door than details is -- not accelerating for to car a delivering to we’ll really any the what I this ever is different the changes S So And or roads This go allowed this faster, there better next. Model that do history. it's like in It's ways. able of a weeks. matter get into later clear, car the that fastest start in is made was type But be car, was to like faster. is This obviously, like maybe many say, week we'll in And,

for actually of new models, because S model the the We model more. $XX,XXX price -- these the people will raising Model be old new be -- so will

they XXk the Full we've think made too public watching it’s massive beta. the best probably Then bought month, recommend our Yes, model Full but car of of more. in the progress world on Self-Driving, So, today. last with any I the regard this kind available Self-Driving. we upset if old people price any hopefully, videos aren't to at one is

So successful for no never been the drives including me not really very do, -- drives place on the improving the just for we've latest think, beta got, almost of software, I that It's a point. the that common beta I X,XXX rapidly. I've – have at release to And very of it's FSD to. each I with in this drive -- people interventions It's roads. to common

before. than -- routes. the the has it's common no So on these more There now even actually a complex drive. to there have for preplanned are more And not -- car never it's not been car are interventions,

of Tesla's -- excess this a an where year. I very a the I'm to is does the a or from justify say, billion potentially the itself the is XX of basically, worth serving can -- a this hypothetically, those of it let's value be robotaxi. $XX -- an of of way, average if potentially it, and of billion ships, is as if just hours utility reliability drive Full human XX highly capable robotaxis and back The $XX they're company will of big and Self-Driving about, deal. become robotaxis. car So being used how hours vehicles like, week think And math, where to a the envelop in increases used average confident one as vehicles, is? there This week, And with thinking -- in justify for

you would a that's car as useful, but is revenue doubling that gross of merely say roughly okay, So useful, assume company, like that -- the again entirely even like, margin. let's in But twice as utility. if let's not becomes almost twice as useful be just Xx which the as Xx increase the -- a of

mean, incremental because will it $XX -- made worth would it of be of from it's cars, you basically $XX like would if million that just it having be profit software. So million like billion $XX

high-growth $X pace you get that, trillion the mode. in XX and is like still -- and it's on the company So PE

the is a And at like where and number to think using nothing taking valuation the suspect else, with are sort of there least I cars cars the way So is just the investors of that justify I FSD. it approach. some of company

year. from going Obviously, not XXXX that 'XX don't conclusion, did know for the hear is external do is standpoint. this given while beginning. was more point what But And not last year terms normal a in think just expect. is in relatively XXXX turning year, profitability, We So in a things, an exciting. you to even to of and we many a Tesla we believe expect we assume be

capital ton how it's We've think year factories or -- on -- be less been coming -- And big And And at eastern great U.S. both going Tesla. products have got up one, new I can pure from are and second, a Berlin with production. great are supply out. much cars the help customers. half that set just it to cars there's supply Berlin, transported think in Europe. I easier can logistics up We've efficiency are fundamental in tied of both the help least many the also having factory advanced for having factories It a that continent the you're a much factories having U.S. of Texas standpoint. on better at Texas the will factories to just and – of got a on each the make with company factories will be in X having

So excited you. to forward yes, And super about look the making Thank happen. it future. we I'm

some our CFO, very you as I Thank think well. Zach opening has remarks much. Kirkhorn, And

Yes. Thanks, Martin.

continue $X.X an flows, and year been challenges. many has alongside free generate to unexpected extremely cash for strong QX, billion cash, in XXXX On investment Elon As managing record a through mentioned, future and programs. we growth while unforeseen successful reaching

Additionally, working to our debt of QX, in which use QX. settling of lines, debt we've continue various been will convertible capital and reduce able $X billion including into

calendar our net profitability. For quarters first year and income, achieved sequential of we X

product margin Model The including Model first, increases portion is on well ASP XXXX the products In despite inefficiencies new from price our noisy as few X. we this gross Automotive both so of introducing employee on was which QX reductions built the S primarily over improving grant launches from two comp COGS, in improved and rise let's On in pump addition, of single-piece auto Model XXXX, operating is in by transitions. stock the a to and things. things; impact heat gross only. and margin specifically, of impacted and expenses. QX over a and quarter QX was a Stock-based unique by Y converting of Model XXXX which credits to course as the part launching castings driven increased, new unpack in SBC across of process is to performance our excluding X, seen invested Fremont, the

for Second, as due we do as in to auto inefficiencies. logistics were chain internal such an views, improvement saw and in margin. pandemic labor and Adjusting items we instability supply costs gross management our these impacted

was Our onboarding mentioned, many capacity. associated impacted costs by service the just and same other with including of services P&L factors new

in impact However, we’ll from here to items increased related of we development fast and saw drive of continue in revenue and as we've the accelerated margin, service what's gross mentioned, a an most reduce energy expansion investment continues capacity growth products. PPA despite as impacts percentage On as Solar OpEx possible. business. to capacity that Roof lease future seasonality costs typical as ramp important the as well is in from

leading. of being changed has nothing industry continue of margin about an for our quarter. the the said, Finally, that resulted in that will notes additional expense our grow early view interest $XXX operating million settlement and convertible to All remain

XXXX step forward, wide, look may and we magnitude few see long-standing year range of the things of be we meaningful in our yet, As benefits outcomes the should The of in That's launches. mind. we keep most possible investments is as capacity a forward technology. given this

a We materially expect of continue which we long-term CAGR exceed XXXX. to of may in volume this XX%,

towards year, long-term goals. volumes half be rates, are necessary production a of to and inefficiencies story increase ramp of we will year's As will and skew the this our the second part achieve

our newly will the to architected ramp the of Shanghai, be low the QX, for production Y benefit in Specifically X volumes and due However, early have to will products. S Model transition

through to have the a shortage, port well may Additionally, hard temporary as semiconductor extremely as we're manage which impact. capacity, working global

updates cost, capacity service throughout long-term. We including as and I the moving focus demand on of the will heavily continues and a continue with invest while outpace look on we're OpEx production, driving on as supercharging forward to we a to providing quickly as Global can percentage progress reductions to year. revenue. in

straight Thank from we can you technologies. very And much. now say jump into questions

from question solar? holding the back in institutional market being what first is share is, Tesla The from leader currently investors

Yeah.

solar So we quarter-over-quarter last best in think, And we're actually had our I seeing quarter year. tremendous QX. since, XXXX in growth

attention building. company, around to a market few unfortunately, of Model to that a have and X solar So work and work years is had basically take cars. we on actually where production people far rapidly. We now whole do -- the and there we more were lot beyond expect to there on devote it the solar, the It's solar in we're go little leader bandwidth, company we But putting become including growing got it. and whole a then

will it Tesla is, leader before think be in market I long the far, So solar. by not

the of an allows have cost part solar industry-leading really which Another is pricing. achieving then industry-leading to important us strategy structure,

think that And it part structure become over a I’ve so that in that's and mentioned, in the place really space. accomplished the getting the year needs pricing something leader terms be we've this last I important the to the in of industry-leading to cost is

Yes. Tesla better retrofit have between end Retrofit and – whether Powerwall Roof. excellent Tesla the the but and important Tesla Solar integration And integration Powerwall integration part Tesla we'll the and before or of with lower we're Solar, achieving actually confident is And the class year. excellent the it's

I – really good got it's think So a strategy. we've

the Zach in regard. As of that we'll we're amount great making in dialed really year. of reducing the that's we're think complexity install, focused on something progress have mentioned, And time the and I and this

Thank you.

sales FSD vehicles owners are The overall sales vehicles. increased huge would question to used current get their second FSD their next This is, and be on to vehicle? more could a of for ability transfer offering loyalty who

the undervalues be. probably good sales with an higher planning I arguably one car FSD the increased Unfortunately, think not do we're considering the than just consumer market. And offering market get FSD. that we're to undervalue a is on currently time. online And going that how not to than offer – this transferred. do market stock without actually currently for price – the But at or FSD We –

you. Thank

We next in soon will month two. be or subscription pretty the offering

address lot of it. to concerns should able that people's a for being So get

At third say the said, low.' – you And much. this dry yields battery on coating the bag give in the as very a you the is update 'I us were as is, electrode? yet Thank not question Elon would of Day, the completely Battery can progress

Andrew?

Day new processes equipment. Battery and manufacturing Yes. revealed system at true. we The in-house contains Sure. cell It's

same So we capacity improve staff and XXXX and S-Curve. challenges is has in week-over-week understanding Kato. to targets. ramp. able rate some from the time, at move the have process The continues And has drive did production cell Kato month-over-month landed our designs, to the through and confidence of production team, problem presented engineering refined deepened worth each solve meeting a been our unknowns production unknown the teams cost technical equipment all date, and we up reinforced XX hours arise the and gigawatt and nearly yield design, and hired. performance The as perspective, however, At expect to manufacturing we to

is equipment facility and material support the manufacturing goal engineering on Our full developed established is supply gigawatt kick chain we've with design off ramp and team XXX production for and process XXXX enough XXXX track Meanwhile, year. confidence the our and to this to production hour equipment our construction

Thank necessary question in very much. next Dojo are Tesla achieve Okay. there? is, why get why you not And confident XXXX? will The autonomy you to Level is X

guess, based I making understanding the between my we're of Yes. beta confident the each iteration. progress that I'm and roadmap on technical

to or human data all so the improving business write get about complex and need the one with the from better saying, now location cars an at the rapidly reliable XX.XXXX% As than And another in challenging. for all with for we happening to intersections. accident. It's We're to I'm everything it got say bio a labeling. we not much quite remarkable it respect car Basically, is to factor it's drive the the The to I'll you of series -- through also reliability labeling. moving And XXX%. case field. video to just And completely corner improving training at getting towards because least it's we've software dramatically. the software XXX%

net a training So, few become for need each the And be video exceptional. and transition as are to so of video, all really, that we upgraded inference to there performances to video labeling inference. met still new to video

effect the Grail And work like video that of So, the better software labeling. course, of this is a that labeling. The the labeling, for, auto on then, has video thing. efficiency making huge is -- Holy a we hot labeling

-- we put we may neural will as -- a we're it order where we computer net the best be can. of of possibly it to be we when So, used, labeling more the a having believe training Dojo magnitude. as tool labeling supercomputer. think training lot work enabling in We well be by into an auto the world efficient is

and itself. this offer thing whole So, in of And it a is potentially as is service. a

not neural to ourselves. So, training, the we're some keep others to trying of need net it

and So, XXX% amounts line for And XXX% in X,XXX% reliability training of I think business data the there than then, human. better could video than be to of average course, and getting whole vast a from of average to human itself. better

that So, helpful in very will be regard. that

run The you this rate production? of XXXX XXXX? cell Thank is you. do current How gigawatt-hour is next what end Tesla's mid-XXXX rate run evolving see question or by of the

but about on true. that that not got think XXXX. that think It's is that -- for focus these run probably XXX a I cells design XXX about exponentially. Tesla But the to the talked what things to should are and kind achieve a like improve saying I capacity number we're for produced because look we up -- mean be think we've total XX% at essentially, targeted gigawatt-hour in tend to we to year of XXXX capacity able installing we important is to we in of or gigawatt hours XXXX. in

one Yes. and a a the curve that can as the curve, said Agreed, S month bit next. S with quite of Yes. makes absolute you difference capacity Elon. initial the And part be before, by on to in off of little you've a the production, bit,

as yes, can. S possibly So, that curve we we mean up as I are fast progressing

we Yes. showstoppers. any don't And see

Yes.

Tesla for doing question service. you to investors. Tesla one from service customer is What improve Thank very experience? reputation had more outstanding much. retail is And a

a to center, appointments out. Now weeks scheduled impossible Jerome? call even and are it's service

Well, as service. no far as Yes. best service,

our one-third. improve visits two to of the years, quality service frequency reduced In trying a by So lot reliability efforts and of last the are we the spent cars. of the

service, to to to really service. -- place, as the is have are have mobile service in is which trying to is it come visits lasts of And One has all visits possible. big that this service to which frequently of make So North America. less as to take in XX% painless year. less than XX% hours. goal, if to increase customers there service, trying no push we XX% than We're effort now more two In people

service service to the back of terms can we're So continues very people their quickly, so improve. on trying vehicles the road. in And to it get appointment, cars

service centers have America. have XXX We about North in we -- right now actually

accelerating, For XXX to time. days. you it's make service as going In wait of have have North less opened appointments get in we this XX plans the we're a December, out are of short and Zach sure those opening. mentioned all earlier, XX XXX, in And the to XX than pace can we open of centers first half centers We're -- America, year. in

what service. to that's we're So doing improve

of And In all is the on terms the the emphasis our move are app. to app. through phone. we trying the Really, phones, we app, want tesla away from to go communications

spot much app phone. As the appointment. alerts, communication and car service the the service is and And directly a than between a all there schedule the from of record written better It the customer is directly can team.

You can in have pictures there.

You care doing card that all can without of payment your entering and the credit take stuff.

what's is to to is You far service features where your the is months technician and happy, And how car service. updates And the and to spot come on going there. everybody coming I on are the be will coming including think from that even on your app. get in the ability going it more there

So we the on everything investing app. are

the I companies the and other that's of as think just like well, most way

one, current need evolve The to X, now investor you Level to in much. key we are to commercial And achieve ridesharing let's a number FSD Level milestones solution? X very questions. go to what Thank question the institutional order

Yes.

whole what back was goes to So nets moment over clips and that, is be car which the is, video. really need than gathering transition And whole we stack ago, – order video. stack actually surround a has to changed That this saying to the in – video. in do the neural it to I to video using to be the to to means has

rates. simultaneously X operating synchronized got you've with So frame cameras

then you've video in everything X and operate that have got surround then – to got car. that you've train basically those the surround frame camera video and label X video. So against neural And snippet nets

is would frame. past neural coming the – be label, So would this we single nets where from single a and camera, the

but frame time, the So not we video then no dimension, time video. nets -- at nets and neural frame at all now time, include at And would cameras. went to we time, a a where a one to and at look all surround X cameras the only single combining that's from camera and neural -- one camera frame, X

that be more itself do getting see of can really I also expanding as see FSD the people. the a least you more FSD -- in work done. done. we're this getting improving betas to rapidly it So going question We're at and include results the And to are beta

towards standpoint, don't a that So person. a like from will vehicle drive a here. my very I see clear any and it Yes. looks obstacles path than safer obvious really XXX%

any Thank or in to to of and FSD applications, bidder auto you. does license And software Tesla OEMs? expect third-party from particular, is, the its second institutionals question plan

I to third our discussions very software And parties. licensing other to licensing think some had open OEMs. we're we've autopilot preliminary about to

keep think, work will is, probably full happy do We're to Autopilot -- I this situation. to like that to Autobidder. become bit more probably than we're I the to for And year. capable not we're license exclusive think, little be this obvious goes a we which then obviously, it than is So to something to need definitely happy And a more self-driving, companies. trying that but Tesla is car more Tesla later do. I of think same other And to prove

software to fine definitely using our companies And going allow autonomy networks. our supercharge to. is Autobidder as not create use We're gardens. haven't Autobidder, the and to be Tesla other to but much We walled thought philosophy about yes,

EV differently FSD world. to question differences to customer preferences, in market? Chinese The Do you. of next Thank the we the product, China the between things is, rest do key win strategy need and

Chinese currently we we EV currently Well, the that in leader are -- market. the winning are

electric in low customers So world. think actually right I we're best-selling we're if of X%, lower This the said, our very doing few or China, mostly I FSD think X% option. is That than the selected China. in as of something have car maybe much rest as

need in China. definitely we make it to So well work

will I a find FSD. most it in in the we well Tesla X Their to think then the Grade some I that in China have of works is world. the customers in discerning among China, China, attention owners detail incredible. are

confident So FSD -- will soon as it’s later as they is buy on that they working I'm this that time. And hopefully we year.

Thank to what you. long-term argue Battery on unit about way Day is pack on And tied to unit vehicle of is, it XX to question the the Three-terawatt fair battery implies capacity? you depending that earnings assume Elon's million next goes for hours long-term capacity per battery company's is target size storage, think to half from best of power profit goal?

Yeah. It is.

that. of limit in So general, output And factory hours? cells. total faster gigawatt cells What's of now, availability electric you the the fundamental can't is than on in vehicles right grow

improved at Now range battery actually high it's approaching cars for It's we've get it's efficiency of Tesla, can -- in standard high a the that XXXs. good even pretty Model the pack. you X, the approaching with the range -- dramatically, such

order a with And some kilometers. we'll continued to standard XXX range and start XXX-mile pack get an improvements, slight to even

-- have that sales. the cell fundamentally, need obviously, But lot for car. a the want in improvements to of efficiency production. there's, a is dependent And on companies other there's growth that So

cell less the order So its of not our growth. -- accelerate is Tesla use is to doing It own in but production suppliers. cell to reason make the is

to I that as it be many In our or take fact, to produce. whether with as Panasonic very batteries can suppliers. want clear, clear CATL cell Tesla will from LG increase purchases And really or wants be they we've cell we suppliers, been

went them goal buy and send as our much suppliers still But production needs as be possible car as cells and on us. -- our production. to our production, clear urge that or of up Obviously, And and simply to as our is I'm disintermediate we that to production, suppliers. we some unwilling they our their to addition with they their taking increase So amount to supplement there own limits It making are their the is because our be can increase either have the we in price increase to not suppliers. cells trying unable affordable. is to beyond, just which are to to will that

our it's above us. acceleration most they that an produce over say suppliers can the So and for

-- the cell double And revenue drives implies and then term. mean the how And company, just the of the think, Roadster you the output vehicle since figure what's so for least vehicle we at value output, one output then out – the output, is – value I that probably cell and I Tesla autonomy probably that long level. that's of

next is The much. very you call. which of this Thank in XXXX about question cells we already covered the retail section

you in your XXXX? are to Cybertruck development? institutional which where are expectations in deliveries Cybertruck investors, straight from What is, the go question let's So last for

All right.

Cybertrack finished all we the of almost engineering. So

machines we're or order Cybertruck We're going We're So design the getting designs actually fixed. to to got at level equipment soon necessary no to Tesla it's make bigger the the of work. design rear even center longer a level. iterating long for because we'll using got We've – the you've bigger a Cybertruck and be a – bed truck obviously, got load. you've body to lot the that's vehicle of going

as body be casting, Model So press to X,XXX an tons rear X,XXX for using Y. ton the opposed casting for we'll

year, vehicle. we of the get volume it's lucky, tons to bit this bigger but expect incredible X,XXX production I be think than few do a we'll I XXXX. If was And in to cast a to quite the So the in that. going able tons, X,XXX end be be world. biggest deliveries towards

we now much. queue. the can very you in And with Thank start questions

you. Thank

Rusch Our Please first Colin ahead. question with Oppenheimer. will come go from

and of that Thanks you for about are Obviously, target and bit into balance a you're throughout way Can the impacting and a how you out? seeing of a and next talk that play the how moving conversations so really the year? understand love now, environment little much, in to regulatory see bit are here, the FSD year guys. right of how rollout you it's guys but FSD those this going we'd

want Okay. Zach, know, – and I Zach you to do don’t Jerome?

is rest The pretty overall particularly going dynamic on seeing as regulators China impetus on – right what reach some U.S., but past this not that. demonstrate slowdown, Level we in said later before. to the past working to or with an Level working really, Level high really generally for fairly space, to new it's Elon interest world have general limiting in to example, X showed Europe, to is And with what not right we're we're see dynamic. year. expect start the to reliability, In a X now X working The a rule reaching even is now basis, work but on groups of

expect in a dynamic XXXX space. pretty we the regulatory So

leadership U.S. groups. demonstrate in releasing the launches wider really good for reliability and have really manufacturers high to looking before to We and wider

And Obviously, Can raw little just the on quick migrating around guys. material material you about then your follow-up a supply you're markets. a lot basic the through and your inflation there's around the talk space. exposure flow of how a rates of of materials on some Thanks, some costs? bit low going chain interest as some

this closely between first Jerome. the we're priority pricing, both Yes, also the to supply disruptions we're North the shipping, forward watching in This deal the with to for particular, all and very for and But COVID now from is chain, looking components. and is Asia America.

mentioned agreements XX% appropriate preferred with quantity earlier, ensure enough growth, the CAGR entering not going pricing suppliers with Zach to risk. only to but also good series have of of are long-term support sharing to that a you're We the as

you. Thank

Levy Our Suisse. with next Dan from ahead. question Credit go will Please come

on and capital. you. just XXXX one good Hi, on Two one evening. questions, Thank

on capital. the Obviously, second are And expectations full can XXXX. What regulatory what extent XXXX. some on the features? doesn't you. covering So, think funds of capacity give then building you you First, we expanding raised elevated and buy? Thank should a we Meaning, about enable And liquidity on those lot of beyond self-drive question does or questions. to integration, us credit Any vertical see for on just just what of of is sales? plans does accelerate elevated accelerating capital you maturities? timing use the what a should those sense the to the on capital in

Sure.

that side, On sales difficult than our to extremely XXXX regulatory sales being not. that possible material a the of of And business, ended additional the that. our will mean up remains over what is not I around area beginning part don't guidance quarters, credit credit that to And QX quarter. a of of regulatory struck were that the also said us it's for that. to an it regulatory revenue always possible plan and credit lined on deals from credit quarter. prior business these not give were expectations. the up long-term, for It's discrete It's the was strong. Most regulatory isn't handful and the that's I it's forecast. be the course in this higher the we difficult before sales of

to us that's So, I forecast. difficult wish I extraordinarily this, it's a but space give Dan, for could on more you

thinking couple the On we're of there. respect side, capital, second a with things that through to

So, have currently conversions helpful well. QX. mentioned now. a reduction convertible We focused reduction $X increase Early these We in on choice remarks, of a of opening in is to we may that debt in and we're are an expense That's as that thing so debt expect early important is things billion That conversions billion out that on. number QX $X.X around interest don't conversions, my did I as go result have as on important. or on we debt.

money using capacity. are future investments respect our We the with also in to

we of so And than the capacity Berlin, that we and do capacity the can as what with that we the able expectation Austin we're some to of particularly end what do had incrementally pulling is, capacity, in to building go now investments, build the be capacity past adding as opportunity haven't those rather state in of we're forward will along.

be important efficiency on, really the an was able the in And to strategy great on of to as company. the have in And is the this so touching is had past. part expansion liquidity haven't the of terms we focus capital to future that. Jerome service more broadly, And to then it's that important do luxury to

bit and quite than QX to service saw the a higher a you the part centers year. mobile of expansion quite was QX our as numbers, of from also and in first service So, increased bit the QX

and supercharging now is cost the in get near us also the but and long-term will to in so, investments demand, term, of to there the make thing network customers And ahead which able future right company. we’re the more what for is our

you. Thank

go will Our ahead. with Alex Sandler. Potter next from come question Please Piper

your vehicles? to that the wondering, also like these iterations in of suppliers. cells you'd you require have XXXX to from this the of purchases putting them was of increase structural how build I Does sort to mentioned newer you're Thanks. capability cells Great.

No, it does not.

they Although, talking it -- not making required. but are about them is we form factor, the with XXXX

factor. uses example, form For the XXXXX currently S the new

consistent they're will, and retiring a form continue form move we think just over our advanced cells. we'll result for in to we it time, more it would on factors factor that be few try But fewer to and the place a at form suppliers, is factor. a we But a would to use So that not -- requirement they least because just cell, years.

So with form it said, deal single suppliers cell it's the form a factors Like for make us have factor time, of different over today. insist to our on consistent a sense I factor. complexity form to will than for better

one It makes capacity Okay. maybe additional, expansion. And qualitative question then on sense.

qualified potentially on human would another. mentioned issues dollars in sufficiently thing, access You've limit against way? I is that but growth any in you your are the is to front that up one past, Thanks. to run beings mean, Have that access any

rate growth the areas. great it limits rate, of the That or size, the focus that right which but onboard and can ultimate limit the which get It rate. them limits of limits the doesn't trained we is is in the one people growth what's things

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other from transition the doing country. to whatever they were of from part got or some they've move So

for of yes, of -- for required that excess -- at we I'd years many for to year in a come. come. time to to so And mean, maintain think XX% years can forward least, I that. growth a amount per certain to there's at look And that many many like rate least, said, we do

to want but think be I and to that's year, this least appears commit fair appear, what would meaningfully bit It we at don't to above the a XX%, it year. to track we XX%. same that, may about but again next

Thank you.

come will Markets. question Spak RBC with from next ahead. Please Our Capital go Joseph

and you in with Elon, tweeted be how about and Sprinter. interesting to could vans electric back it work Daimler Thanks. XXXX,

of really But seen anything of in a space since. the van activity and meantime, we've heard haven't of electric from number in of startups. lot We a last-mile players established

this your lot said us know that a on have of an you I you the table, on of you're in? And interested something is it provide you So can but thoughts projects update market?

I an battery one thing some van in are there point. very the not this the think it's Tesla like thing in how It's to production to is to hard that on is. Prototypes constraint mind just The if electric a is hardest fundamentally It's hard. manufacturing, involved easy. hard is is world. production appreciate in really Scaling output. cell definitely at going bear make to is -- scale

we could would to production Semi, into it reason with products cells accelerated Semi we our for this group. So is the we a Tesla right go reason the that now. is the to We Semi were like we not new right like, -- main make easily happen the -- have if not part -- we have cells built now, -- enough of example, simply for which don't big but

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for it make address go not it Semi can as cell us as absolutely of kind would now, soon it that. would production do do sense the us The make same to for make sense right So -- the for constraint. but to doesn't it we will

stated And one years away. next-gen item. into chip you. Autonomy dig could I Okay. that working Thank your was which Tesla you X the you're years About then ago, X on at more the Day, maybe about past if on

front? that on update any there is So

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if the the a to coming it's set have on with the change would chip so shape. back were we version not things be Self-Driving, can bit a along And achieve simultaneously. would But software. FSD of -- it FSD, and requires quite Full of system, Full introduce the it But a actually now us distraction to Self-Driving, current a right chip. we X it it's quite rushing Tesla X well, bunch good It's since in been because the we

And the software is to Self-Driving. Full path critical

not changer. changed. a be nets and much getting the software to but that's all worry has an to changer. about video, to game too wouldn't improvement I not the the game that's Getting be a That's that. So -- That neural work

you. Thank

will question Please next Deutsche Emmanuel ahead. with go Rosner Our come Bank. from

very much. about you first cell in-house Thank is question My manufacturing your efforts.

up some XX%, the cut So boost range about highlighted cost the in by number XX% was you goals capacity, or of the over years. to a about addition building the of to pricing by

eventually? to how the is, this, for the Tesla, you direction? to maybe achieve like line related cheaper And thinking the are about wanted time your initial if are So these efforts trending What sort, goals? entry know in model, of the timeline to that

I year over think confident it's time three-year let's targets, not like it achieving feel those one. frame. we very don't say, I about a grew -- know

or ourselves years, say. years, give four for maybe three, four three So little room. I’d a But

put in on together still. the trajectory we're that We trajectory Yeah. the and Day, Battery

trajectory probably reference cost are that's the the think for I that best on. we

but we We're Yeah. what of than Day. are we to better Battery confident least do at presented aspiring for doing Battery Day, at

you. Thank

with ahead. next question go from Our will come Baird. Kallo Please Ben

team. the you, congrats Hey, whole guys. Thank Elon, to

trying and There's you a down have correctly, going when remember lair If to that and I put we you'd mass questions XX -- the together Hawaii, you. years, of together. it have you and back on Chief a And into talked then all the x.com, Architect. a the you trying breadcrumbs. subsea Thank put be road, CEO car as there. I'm to step go So market we're lot about all

Well, Sure. I Tesla of several expect be years. to for CEO

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So expect I several to future. do for company the into years the be running

is Now, be forever. nobody obviously, or CEO should

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pretty to time it intense. have a sleep would up day to as on free days to my from So opposed working to wake seven be and bit go more I just when when I a nice hands week, night,

order on yet, accelerate sustainable goal been like world of less like the an percentage say isn't energy. fleet worldwide. And we we the from a So of the on Tesla, if to electric the are I or in sustainable -- energy. beginning, but mission way today, than advent but got -- of think road mean, very, still dent of I before total ago make the X% cars tiny, and still accelerating you long can really over the what has X%, it's a very

hydro packs. to maybe battery and the of to power, geothermal I'm actually to geothermal. the fission legs not and course, generation, advent large also way the that go – reactor is a of weather There's that's are we stationary others. situation good So see X% mean bad on order actually is tremendous solar way solar on to of the by of energy seriously it's weather sustainable volume for well-designed the a actually against to wind I bad a nuclear three few need nuclear do. cost-competitive and full go thing have in exciting And is or a although solar, I of is long And fleet a basically, a electric. not sustainable very think energy is and future a led with of subject wind, fission.

doesn't then batteries wind time. – storage most doesn't It time. all you second stationary The need sun is because – renewable the doesn't energy the So blow the intermittent. need shine and the all thing is

lot then you a life. electric of So transport. to And you need high be needs and it batteries. And cycle very need long-lasting

you a with three environment. energy and have those respect If the things, to we've got bright very future

that. So a go long on to way

still very much I'm to so And fired on up work that.

Fantastic. And the last take let's question please.

you. Thank

will go from ahead. with Our last Loup Munster Gene question Please Ventures. come

related happy full miles, see of Semi will of couple was typically a had I achieve to travel first and questions. to Trucks autonomy? update first, the predictable Semi on highway And the Semi be since timing Tesla may the

imagine Yes, that's yes. seems would likely, sure but – I it yes, highly likely, two, quite who number I I'm not be can't yes. think

my... Okay. then And

Tesla The same hardware, it's cars. There's the Semi the difference. the on numbers no on exact part

Yes. Yes. That's true.

or modify we because As it to S. X change Model Self-Driving for Model parameters, parameters Y, now it the to needs software Autopilot need Model is, Model or X,

it brain And in is that Self-Driving this inform a vehicle, to – the Semi Truck. so just inform we is the Full now need

Would retrained of it be as part then need to that?

No.

to needs the you in city. I do do its a there will on do in like giant there think try be regular you thing street parallel being a could in to It because to know cannot different this that truck. a have – a car control you are turns park functions limitations that Semi, a you want

to cell question explain will us you win if Makes hydrogen electric versus help why was battery tech? follow-up fuel just could related sense. My

very table. like as liquid, like close is honestly, it's And It's a one million going Yes. than this means it's as low that low case. somehow periodic a only batteries. very regular Roadster days, absolute a is in was And It's even in Hydrogen were had the vehicles, really I we zero. got number energy had liquid. this the then times liquid very the a a back got People better – of before question density is the just early a density. I've saying mean, not a in car out. be even for just Roadster for it styrofoam-level hydrogen storage density to to

So it's you as have liquid. not to – to keep it realistic have a really

it lower have even high-pressure to density. that gas has want You as a

I'd than need a crazy very like storage cell gigantic it's It's hydrogen, The going an mechanism complications we those And then it works hydrogen. -- fuel situation. a even say, volumetrically, we're It's energy be adds So chemical and methane somebody just extremely you is having a or got math to way use And pressure. to high basically. trucking with propane better fuel to batteries. that, something the ultimate just or basically. confident yes, If be say be just long-range use tank pain big out. could a further that to will

go, and payload? like You does your what And cells, it's could to say, like, need how if per just available you miles? And would take, okay, don't -- affect kilogram say, let's watt-hours weight of degree much say, currently okay, do you -- XXX that what to this.

no you on that? I or almost you effect have you mean, have long-range If truck. you a can want to Jerome, it to and right, do do your nothing, add basically payload

Tesla having for perfect also the looking -- Semi And we perfect. to forward an be see it, increase And I additional of it I some road very yes. trucks. on on very ones regionalization agree The will the there. think I'm I'm And will soon. be

compelling long-range see basically, the batteries. truck with The cell supply only with is any we thing. problem But creating supply; cell do issues is not a

be It's going to awesome.

Yes.

today. unfortunately, you all Thank And very the that's much. right. time All we have

thanks in months. for we again of your you. and will questions, great about three all you So, speak to Thank

Bye. so much. Thanks

conference Thank call. you this and for Ladies concludes participation. gentlemen, today's your

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