Release Date: April 22, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tesla Inc (TSLA, Financial) is on track to launch fully autonomous rides in Austin by June, with plans to expand to other cities by the end of the year.
- The company has made significant progress in localizing supply chains, reducing logistics risks and tariffs impact.
- Tesla Inc (TSLA) achieved a record gross profit for its energy storage business in Q1, with strong demand for Megapacks.
- The Optimus humanoid robot project is progressing well, with expectations to scale production to thousands of units by the end of the year.
- Tesla Inc (TSLA) continues to lead in AI and autonomous technology, with plans to have millions of autonomous vehicles operating by the second half of next year.
Negative Points
- Tesla Inc (TSLA) faced a decline in vehicle deliveries in Q1 due to factory updates and negative brand perception in certain markets.
- The company is experiencing challenges related to tariffs, particularly affecting the energy business due to reliance on Chinese LFP battery cells.
- Auto margins declined sequentially due to lower deliveries and reduced regulatory credit revenues.
- The Optimus robot production is affected by supply chain issues, particularly with permanent magnets from China.
- Tesla Inc (TSLA) is facing increased operating expenses due to investments in AI initiatives and new vehicle programs.
Q & A Highlights
Q: What are the highest-risk items on the critical path to Robotaxi launch and scaling?
A: Elon Musk, CEO, explained that the Robotaxi launch in Austin is on track for June with fully autonomous Model Ys. The ramp-up will be rapid, and large-scale autonomy is expected by mid-next year. Ashok Elluswamy, VP of AI Software, added that validation is crucial due to the long-tail problem of rare edge cases, and sophisticated simulations are being developed to ensure safety.
Q: When will FSD unsupervised be available for personal use on personally owned cars?
A: Elon Musk, CEO, stated that unsupervised FSD should be available in several U.S. cities by the end of this year. The goal is to ensure it is definitively safer than manual driving before a broader rollout.
Q: Is Tesla still on track for releasing more affordable models this year?
A: Lars Moravy, VP of Vehicle Engineering, confirmed that Tesla plans to release new models this year. While the ramp might be slower due to industry turmoil, production is expected to start within the planned timeline, focusing on affordability and utilizing existing production lines.
Q: Does Tesla see Robotaxi as a winner-take-most market, and how does it compare to Waymo's offering?
A: Elon Musk, CEO, highlighted that Tesla's Robotaxi solution is more cost-effective and scalable compared to Waymo's expensive sensor suite. Tesla's AI software and hardware capabilities give it a competitive edge, and the company expects to have a significant market share with millions of autonomous cars deployed.
Q: How is Tesla positioning itself to adapt to global economic risks like tariffs and political biases?
A: Vaibhav Taneja, CFO, explained that Tesla mitigates risks by regionalizing supply chains in North America, Berlin, and Shanghai. The company is highly vertically integrated, which helps protect against supply chain disruptions. Elon Musk added that Tesla's lithium and cathode refineries further enhance supply chain resilience.
Q: Did Tesla experience any meaningful changes in order inflow rate in Q1 due to rumors of brand damage?
A: Despite economic strain and negative articles, Tesla remained the best-selling car in California in Q1. The company also recorded a high number of test drives globally, indicating sustained interest in its vehicles.
Q: Can you provide an update on the unboxed method and its progress?
A: Lars Moravy, VP of Vehicle Engineering, stated that the unboxed method is progressing well and is integral to the Cybercab manufacturing process. It allows for low-cost production and high automation levels, representing a revolutionary approach to car manufacturing.
Q: How does Tesla plan to address the challenges posed by tariffs on the Optimus supply chain?
A: Elon Musk, CEO, acknowledged that Optimus is still in development, with production expected to ramp up by the end of the year. Tariffs on rare-earth magnets from China pose a challenge, but Tesla is working to secure necessary licenses and overcome these issues.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
