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Author Topic: Tesla: Profits not from selling cars, but selling regulatory credits  (Read 270 times)

Nick1911

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Bit of an interesting article:  https://www.fool.com/investing/2021/01/30/teslas-profits-are-not-from-selling-cars/

Quote
To be clear, Tesla did report a profit for 2020, under generally accepted accounting principles (GAAP), marking the company's first full year of profitability. But that profit did not come from the core business of manufacturing cars. Tesla booked a whopping $1.58 billion of revenue from selling regulatory credits last year, more than the previous three years combined. Tesla's net income of $721 million in 2020 turns into a substantial loss if those regulatory credit sales are backed out.

It seems the company would be heavily in the red if not for the legal environment that allows them to sell regulatory credits to other automakers.

HankB

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #1 on: April 01, 2021, 10:39:07 AM »

Regulatory CREDITS? Really?

You know the economy is in trouble if the government has arranged for the sale of imaginary products for real money, enabling them to make an enormous profit without delivering anything tangible.

(For some reason, I'm reminded of the old joke in which three men of a particular ethnic group were shipwrecked on an island, and passed the time trading their hats back and forth with one another. When they were rescued a year later - each was a millionaire.)
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fifth_column

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #2 on: April 01, 2021, 11:41:55 AM »

Regulatory CREDITS? Really?

 . . . the sale of imaginary products for real money, enabling them to make an enormous profit without delivering anything tangible.

Sounds like the definition of the insurance industry to me . . . .
Power concedes nothing without a demand. It never did and it never will... The limits of tyrants are prescribed by the endurance of those whom they oppress. ― Frederick Douglass

No American citizen should be willing to accept a government that uses its power against its own people.  -  Catherine Engelbrecht

Angel Eyes

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #3 on: April 01, 2021, 11:54:29 AM »

Sounds like the definition of the insurance industry to me . . . .

I am reminded of the Catholic Church's sale of indulgences, which Luther and other reformers condemned.
"We have put together, I think, the most extensive and inclusive voter fraud organization in the history of American politics."
                            - Joe Biden

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                            - also Joe Biden

MechAg94

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #4 on: April 01, 2021, 11:58:43 AM »

Just wait until Democrats manage to pass CO2 credits like they wanted during the Obama years.  Some Democrats were heavily involved setting up exchanges to take care of that once it passed. 
“It is much more important to kill bad bills than to pass good ones.”  ― Calvin Coolidge

sumpnz

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #5 on: April 02, 2021, 12:14:41 AM »

The sale of the regulatory credits has really been their core business model all along.  Once those run out (and Elon has been pissing off enough people that just might finally turn off that spigot) the illusion of them having a strong business will evaporate.

I haven’t checked in a while, but if Tesla isn’t issuing stock in order to pay off their debts the CFO should be arrested for fiduciary malfeasance or something along those lines.  Before the stock split I figured they should have been around a $30-50 stock, at most.  Probably $10 after the split (5:1 IIRC).  They’re around $600+ I think.  If they cleared all debt they probably would be able to keep going for a very long time even if the regulatory credits completely disappeared.

230RN

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #6 on: April 02, 2021, 06:14:42 AM »

"Hey, kid... wanna buy some air?"

https://youtu.be/9GNfRBn4-5c (4:20)

And they say TV isn't educational.
We  have got to stop putting fuzzy-headed Nannies in positions of political power.

HankB

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #7 on: April 02, 2021, 12:51:42 PM »

Just wait until Democrats manage to pass CO2 credits like they wanted during the Obama years.  Some Democrats were heavily involved setting up exchanges to take care of that once it passed.
Didn't Algore make a bundle of money selling imaginary clean air credits or some such nonsense with the blessings of fed.gov?
Trump won in 2016. Democrats haven't been so offended since Republicans came along and freed their slaves.
Those who work for a living are being BURIED by those who vote for a living.
Government is a broker in pillage, and every election is a sort of advance auction in stolen goods. - H.L. Mencken
Patriotism is supporting your country all the time, and your government when it deserves it. - Mark Twain

MillCreek

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #8 on: April 02, 2021, 01:46:08 PM »

I have an acre of property, which is 80% covered in forest or grass.  I wonder if I can monetize the flora sequestering carbon dioxide and producing oxygen in excess of the needs of two adults, a dog and a cat.
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Quote from: Angel Eyes on August 09, 2018, 01:56:15 AM
You are one lousy risk manager.

Fly320s

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #9 on: April 02, 2021, 01:55:33 PM »

I get a small amount of money from the carbon credits my solar panels "create."
Islamic sex dolls.  Do they blow themselves up?

Pb

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #10 on: April 02, 2021, 02:09:05 PM »

I guess that explains why Musk considers himself a socialist.   ;/

Nick1911

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #11 on: April 02, 2021, 03:10:22 PM »

I have an acre of property, which is 80% covered in forest or grass.  I wonder if I can monetize the flora sequestering carbon dioxide and producing oxygen in excess of the needs of two adults, a dog and a cat.

Side note, this is sort of a common misnomer.  While biomass (especially in early growth stages) does indeed pull carbon dioxide from the air, it really only hold on to it for a short while.  Eventually the trees and plants die, and release the CO2 back into the atmosphere as decay products.  "Lets plant trees!" is sort of a feel good farce to anyone who is serious about actual carbon sequestration.

Kingcreek

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #12 on: April 02, 2021, 04:22:14 PM »

I have an acre of property, which is 80% covered in forest or grass.  I wonder if I can monetize the flora sequestering carbon dioxide and producing oxygen in excess of the needs of two adults, a dog and a cat.
Back when the carbon exchange was active I looked into it. Almost 40 acres of timber and tall grass native prairie. There was a .gov online calculator.
Iirc I could complete 29 pages of application with annual attestation filing and collect a whopping $18.
The carbon exchange was discontinued. Algore was compensated with shares to be on the board and he cashed out for a couple million without ever having put any money into it.
What we have here is failure to communicate.

MillCreek

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #13 on: April 02, 2021, 06:54:43 PM »

Side note, this is sort of a common misnomer.  While biomass (especially in early growth stages) does indeed pull carbon dioxide from the air, it really only hold on to it for a short while.  Eventually the trees and plants die, and release the CO2 back into the atmosphere as decay products.  "Lets plant trees!" is sort of a feel good farce to anyone who is serious about actual carbon sequestration.

I do indeed learn something every day.
_____________
Regards,
MillCreek
Snohomish County, WA  USA


Quote from: Angel Eyes on August 09, 2018, 01:56:15 AM
You are one lousy risk manager.

Ron

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #14 on: April 03, 2021, 08:53:37 AM »

Recently there were scare headlines out there about how parts of the Amazon is now adding more CO2 than it is sequestering.

The wish not to believe can influence as strongly as the wish to believe.

Who can escape their own cognitive biases?

Fly320s

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #15 on: April 03, 2021, 10:48:29 AM »

Recently there were scare headlines out there about how parts of the Amazon is now adding more CO2 than it is sequestering.

Forest being cut down or population growth?
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Kingcreek

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #16 on: April 03, 2021, 12:34:49 PM »

Forest being cut down or population growth?
Or maybe caravans pooping on the side of the road.
What we have here is failure to communicate.

Ron

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #17 on: April 03, 2021, 12:35:21 PM »

Forest being cut down or population growth?

Yea, the lumber industry and burning the forests for farmland.
The wish not to believe can influence as strongly as the wish to believe.

Who can escape their own cognitive biases?

HankB

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #18 on: April 03, 2021, 02:02:57 PM »

Side note, this is sort of a common misnomer.  While biomass (especially in early growth stages) does indeed pull carbon dioxide from the air, it really only hold on to it for a short while.  Eventually the trees and plants die, and release the CO2 back into the atmosphere as decay products.  "Lets plant trees!" is sort of a feel good farce to anyone who is serious about actual carbon sequestration.
The carbon in biomass that became coal and petroleum was only held on to for a short while?  ;) 
Trump won in 2016. Democrats haven't been so offended since Republicans came along and freed their slaves.
Those who work for a living are being BURIED by those who vote for a living.
Government is a broker in pillage, and every election is a sort of advance auction in stolen goods. - H.L. Mencken
Patriotism is supporting your country all the time, and your government when it deserves it. - Mark Twain

MillCreek

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #19 on: April 03, 2021, 02:08:31 PM »

^^^Plus I was thinking that I have trees on the property that are over 100 years old.  They will die at some point in the future, but they are for now proving a net benefit in carbon dioxide management during my lifetime.
_____________
Regards,
MillCreek
Snohomish County, WA  USA


Quote from: Angel Eyes on August 09, 2018, 01:56:15 AM
You are one lousy risk manager.

kgbsquirrel

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #20 on: April 03, 2021, 03:35:46 PM »

I am reminded of the Catholic Church's sale of indulgences, which Luther and other reformers condemned.

Bingo!  Malum prohibitum, unless you pay us.

kgbsquirrel

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Re: Tesla: Profits not from selling cars, but selling regulatory credits
« Reply #21 on: April 03, 2021, 03:49:53 PM »

Side note, this is sort of a common misnomer.  While biomass (especially in early growth stages) does indeed pull carbon dioxide from the air, it really only hold on to it for a short while.  Eventually the trees and plants die, and release the CO2 back into the atmosphere as decay products.  "Lets plant trees!" is sort of a feel good farce to anyone who is serious about actual carbon sequestration.

This is why I push for Fischer-Tropsch fuel synthesis powered by nuclear and hydro.  The process pulls CO2 from the oceans (because 40x the concentration of open air, and wave action means air and ocean balance each other) thus it closes the carbon loop for hydrocarbon fuels AND it uses existing infrastructure so no need for massive spending on piping, charging stations, etc.

ETA: ethanol is a net energy consumer and fuel adulterant (contaminant) and is a federal money scam that should end.