Following what can only be described as a catastrophic Friday – a day where Tesla stock and bonds both tanked in reaction to the company CEO publicly smoking marijuana and two key executives leaving – Tesla was back at it again Friday evening, publishing a blog post that sets lofty expectations for the quarter and dangles numerous other carrots in front of company employees, stockholders, analysts and anyone else morbidly curious watching as the saga unfolds.
The Friday evening blog post was said to be a copy of an internal email that was sent to all Tesla employees.
The email starts out by CEO Elon Musk thanking all of his employees for their “incredible efforts and contributions” and reminding them that the company was almost unknown 10 years ago. “This is a very exciting time for Tesla, to say the least, and you are the reason for the tremendous progress we’ve made in a relatively short period of time,” Musk wrote to his employees.
Then, Musk launched right into specific guidance for the third quarter that, in light of his recent erratic behavior, the market is going to hold his feet to the fire on. In the second paragraph Musk boldly states, “We are about to have the most amazing quarter in our history, building and delivering more than twice as many cars as we did last quarter”.
Recall that in Q2, Tesla produced 53,339 vehicles and sold 40,768. Anybody reading this blog post is going to assume that this new guidance means that Tesla will be posting a minimum of 106,678 vehicles produced and 81,536 vehicles sold.
But then Musk follows it up with an odd qualifier, adding “For a while, there will be a lot of fuss and noise in the media” and then he urges employees to “just ignore them”.
Of course, if the company is going to hit its guided numbers, why the fuss? It leaves us wondering if it could be an allusion to coming news related to Musk, or perhaps the company not achieving its goal of being GAAP profitable for the quarter. Or, could there be something else inside of the black box that is Tesla that we may not even know about yet?
Musk then says that the company has the “the most exciting new product lineup of any company in the world.” He continues, “There is the Model Y, the Tesla (pickup) Truck, the Semi and the new Roadster. Then there is the Solar Roof, which is spooling up in production, and continued advancements in Powerwall and Powerpack.” To date, the company has released scarce details about their plans for building and ramping up these new models.
Then, of course, in true Musk fashion, he dangles another carrot and alludes to more secrets, stating “And that’s just what people know about…”.
There are no notes in the blog post about how Tesla is going to produce all of these vehicles after slashing capex guidance twice in the last two quarters. Regardless of what Musk supposedly has coming down the pipe, the company is going to need capital to make it happen, which is why investors may not be waiting with bated breath for these new models.
Then, after two more key executive departures on Friday – the company’s Chief Accounting Officer and its Chief People Officer – Musk announced a slate of promotions and management management changes that includes:
Musk wraps up the blog post and email by stating to his employees that what they are doing is “vital to achieving an amazing and sustainable energy future for all of humanity in life on earth”.