5. Tesla expects windfall from self-driving tech rollout
Tesla is selling "full self-driving capability" as a $6,000 option on its electric vehicles, but can't put the money in its coffers for the time being, Axios' Joann Muller writes.
The big picture: Most of it is sequestered on the company's balance sheet as a liability — deferred revenue that it hopes to recognize some day, when its cars can actually drive themselves.
- It's unclear when that will happen. Right now, with Autopilot, they have only limited highway driving capabilities.
- But long term, CEO Elon Musk is banking on increased revenue and improved margins from automated vehicles to keep the Tesla growth story going.
When Tesla can offer a fully self-driving car, says Musk, profit margins will soar to as much as 30% (from today's 19%).
Between the lines: Tesla had about $1 billion of deferred revenue on its balance sheet as of March 31, for "unsatisfied performance obligations."
- Deferred revenue is common in businesses where customers prepay for a subscription or service, for example.
- In Tesla's case, these aren't just self-driving features that have yet to be activated.
- They also include access to Tesla's Supercharger network, internet connectivity, and over-the-air software updates.
While most carmakers say fully automated vehicles are still a decade away, Musk says Tesla will have a million robotaxis on the road by next year.
Shade thrown: Barclays' Brian Johnson notes that many weekend athletes "aim" to run a 4-minute mile. It doesn't mean they achieve it.
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