Part 7/13:
Cost and Margins: Is Tesla's Strategy Sustainable?
Concerns about the profitability of the Cybertruck loom large. With estimates suggesting a $40,000 loss per vehicle at current production levels, questions about long-term viability grow. Yet, insiders assert that as production volumes increase—beyond 10,000 units—they expect costs to decrease substantially.
Interestingly, the conversation highlights that Tesla’s focus is less on vehicle price and more on margin preservation and profitability. The focus should be on how efficiently Tesla can produce at scale, leveraging cost reductions and high-margin software features.