Tesla produces its 2 millionth vehicle at Fremont/Nevada
Tesla
Yesterday Tesla held its second quarter earnings call. Although Elon Musk has previously said he wouldn't be on earnings calls in the future, he did make this one.
As with previous earnings calls, plenty of data and statistics were revealed relating to production, future products, and FSD Beta.
Below is a recap of the entire event, including the Q&A session. The recap was originally posted to dburkland.com.
You can also listen to the earnings call below. The call begins at the 11 minute mark.
Opening remarks from Elon Musk
Unique quarter for Tesla due to Shanghai shutdown
Production records achieved in Fremont & Shanghai
Set up nicely for record breaking 2nd half of 2022
Past years have thrown several force majeure at Tesla yet the team continues to overcome
Giga Berlin Production Ramp continues with 1000 cars / week in June, Giga Austin to follow with the
same number in the next few months
Still making cars w/ 2170 cells in parallel and important to note they aren’t dependent on 4680s and
will still hit their production numbers
FSD Beta deployed to over 100,000 owners
5-6 years ago they set out to be the best manufacturer in the world
Pro-manufacturing mindset has given them a competitive edge
Currently make the largest castings in the world
As a result of improved manufacturing processes in Berlin & Texas, Tesla has reduced body
welding robot count by 70% per unit of capacity
Body shop is roughly 3x smaller as it would be otherwise
New vehicle bodies are lighter, cheaper, and quieter thanks to reduction in NVH
Another level of simplicity and improvements are coming with Cybertruck (as well as future
products coming down the road)
Intelligent seat belt tensioning based on vision system recently released, first in the industry to
do this
Can also adjust the airbag deployment as well
Delivered via OTA update
Will have profound impact on passenger safety
Compatible for all HW3-equipped Teslas
Cybertruck
Production still expected to start middle of 2023
“Best product ever” -Elon
FSD Beta
Planned to be released to all North American customers by end of 2022
FSD will then be released to other geos such as Asia and EU soon after pending regulatory
approval
Opening remarks from Zach Kirkhorn
Made substantial progress in almost every area of the business
New production records reached in existing factories and new ones actively ramping
Highest solar production volumes in years
Temporary shutdown had noticeable impact to vehicle margin
Factory ramping also associated with negative impact on vehicle margin
Inflation, commodities, and logistics continue to be headwinds
Resource constrained on Powerwall and Megapack which should be resolved in the 2nd half of 2022
Austin & Berlin operating costs are going down as production ramps up
Tesla sold 75% of Bitcoin holdings
They did so as they were uncertain when COVID lockdowns in China would end
As a result they wanted to maximize cash position
They are still interested in Bitcoin and have not yet sold any Dogecoin
Highest operating margins ever at 14.6%
Still targeting 50% of growth and still within reach
Q&A
Chinese EV Manufacturers & Software Innovation
Elon believes Tesla China is the best EV manufacturer in China
Chinese car companies will be a force to be reckoned with going forward
Tesla has respect for Chinese automakers but believes they have whats necessary to compete
Unified Vector Space
Unified Vector Space would be if instead of knitting together dynamic & static objects
w/ C++ you knit them together at the NN level (meaning you no longer need to reconcile them
in C++ heuristics)
Architecturally better way
Slight improvement in efficiency of FSD stack and something they want to get to
Nirvana situation would be to have surround video auto labeling for all static & dynamic
objects as well as surround video inference w/ spacial memory
Elon believes they have a unified vector space by the end of 2022
Elon is also very confident that Tesla will improve the frame rate as they delete legacy NNs
and further optimize the FSD software stack
The goal is to get FSD Beta to operate at 36fps for all 8 cameras compared to the current 24
frames which will reduce latency when reacting to a dynamic environment
Inflation & Future Price Reductions
They do not control so therefore Elon says take w/ grain salt but thinks inflation to
decrease by end of 2022
Carbon, steel, aluminum, etc are trending down in cost which should see impact later in
2022, early 2023
Processing of lithium is insanely costly
Elon again encouraging entrepreneurs to enter the lithium business as there are, “software
margins”
“License to print money” -Elon
Bitcoin
Cryptocurrency is not something Tesla thinks about a lot according to Elon
Main goal is production and addressing climate change by making sustainable energy &
transport a reality
4680s
Structural pack is a monumental step forward from a physics perspective and is the way to go
Gained perspective through entering production w/ structural pack Teslas which proved their
hypotheses
Cost improvements are thanks to solving technical issues and scale
They have saved 4-5kg in mass from the early cast Model Y underbodies since their initial
production
Plan is to reduce mass of castings and to include more parts (and to adapt vehicle to work
better with castings)
Cybertruck will be another big step in this area
Making progress on 4680 production ramp but continuing to leverage supplier cells (2170s) to
ramp Giga Berlin & Texas
Total production ramp of 4680 packs to 1000 per week by end of the year (preferably earlier)
Q2 @ Kato fully automated powder conveyance for the dry anode electrode tool there unlocking
major improvements in production & yields too
Production as a result has increased 35% MoM since March and yields throughout factory are
already at targets or trending towards them
Took learnings from Fremont cell & pack lines and built optimized lines in Giga Berlin
& Texas
Cell design was revved to unlock higher performance and manufacturing simplicity
Lines were fully integrated and insourced additional content
As a result new challenges for ramping in Giga Berlin & Texas
Last quarter cell equipment was fully installed at Giga Texas and they have since produced
their first commissioning car sets of 4680s cells
The target for Texas is to begin mass producing 4680 cells in Q3 2022 with the goal of being
able to exceed the weekly cell production capacity of the Kato battery plant by end of 2022
Priority with 4680s initially is simplicity and scale, Tesla was not aiming to include all
of the bells & whistles right off the bat
As manufacturing goals are achieved they plan to layer in new material technologies into
their structural packs (and increase range as well)
Currently in regards to 4680s Tesla’s main focus is to remove low hanging issues that would
prevent further production ramp
Dry electrode anode & cathode are included in the current 4680 process which makes
things harder to ramp (yet they continue to achieve success here)
Once mass production achieved they plan to quickly iterate w/ an increase in energy density
and overall performance soon thereafter
Tesla cell production will continue to compliment production volumes from suppliers
Fundamental rate limiter for transition to sustainable energy is rate of li-ion battery pack
production
Not due to scarcity of raw materials, refining lithium in ultra high purity is quite
difficult and requires massive amounts of machinery
Super difficult to create anode and cathode
Elon believes 2/3 of batteries in the future will be iron phosphate, maybe some with
manganese
Tesla is actively working with suppliers to ramp as quick as possible
Tesla is taking action by building their own Cathode plant at Giga Texas as well as taking
the plunge into lithium refinement
FSD Development Progress & Andrej Departure
While Andrej Karpathy will be missed (recent departure), Elon remains very bullish on
current team of 120 people in software / AI group and believes that they will solve FSD by
end of 2022
No major setbacks or delays in FSD timeline should occur as a result of Andrej’s departure
Elon believes they will raise FSD price just before they go to wide beta (targeted for end
of 2022)
Value of FSD is extremely high and not well understood by most people, Elon thinks its
ridiculously cheap if promises of performance materialize
Semiconductor Supply Chain Constraints
Tesla procures about 1600 unique pieces of silicon from 43 different companies
Supply chains are more stable w/ latest generation of chips
Chips from the analog & mixed signaling space still remain a challenge from a supply
chain perspective
Supply chain line of sight continues to match planned outputs for both factories (no
constraints)
Long term contracts already in place for key battery materials and so there are no concerns
about future constraints
Tesla does not plan to manufacture their own chips however they continue to work with
suppliers to ensure future product goals are achieved
Chip shortage forced Teslas to delete redundant chips and update software accordingly (big
positive in hindsight)
Cybertruck
Deliveries to begin by the middle of 2023
Vehicle Demand
Vehicle demand not an issue for Tesla for the foreseeable future
No sizable macro impact on demand
Difference between value in money and affordability and why you can’t just keep increasing
prices
Elon feels that they have raised prices to “frankly embarrassing levels”
Supply chain and inflation are main culprits for price increases
Elon is hopeful Tesla can reduce prices soon
Elon thinks its achievable to produce 40,000 vehicles per week by end of 2022
Teslas has already produced 30,000 vehicles per week many times, 40,000 vehicles per
week is definitely in reach
Plan is to get Giga Berlin & Texas to ramp to 5,000 vehicles per week by end of
2022 and 10,000 vehicles per week by end of 2023
Elon reaffirms that Tesla does not have a demand problem but instead a production problem
Elon’s Role At Tesla
If there is only good news Elon won’t plan to join the future earnings calls
Elon is committed to working at Tesla as long as he can continue to help advance the company
AI
Elon didn’t want to steal thunder from AI day so he will save the news / updates regarding
Dojo & Optimus for then
You can follow Dan Burkland on Twitter at @DBurkland.
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Ganesh Venkataramanan, Tesla’s project lead for its ambitious Dojo supercomputer project for the past five years, has left the company. Bloomberg reported this development, stating that the news was confirmed by sources familiar with the matter. Peter Bannon, a former executive at Apple Inc. and a director at Tesla for the last seven years, has now taken the helm of the project.
Venkataramanan's departure from Tesla last month is now stirring conversations about the potential impacts on Tesla's future initiatives. His contributions to the Dojo project have been pivotal, especially in designing the custom D1 chip that powers the supercomputer. Venkataramanan, with his extensive experience, including a significant tenure at Advanced Micro Devices Inc. (AMD), was a crucial asset in setting up Tesla’s AI hardware and silicon teams in 2016.
Dojo: A Cornerstone for Tesla’s Self-Driving Aspirations
The Dojo supercomputer is a critical element of Tesla's strategy to enhance its self-driving capabilities. Designed to train machine learning models integral to Tesla's autonomous systems, Dojo processes vast amounts of data captured by Tesla vehicles. This rapid data processing is essential for improving the company’s algorithms, with analysts suggesting that Dojo could be a significant competitive advantage for Tesla. In a recent estimation by Morgan Stanley, the project could potentially add $500 billion to Tesla’s value.
Elon Musk has been vocal about the company's commitment to the Dojo project, planning an investment exceeding $1 billion by the end of 2024. The project's importance was underscored in Tesla's decision to shift from relying on Nvidia Corp.’s supercomputers to developing Dojo, poised to rival systems from Hewlett Packard Enterprise Co. and IBM.
Looking Ahead: Impact and Future Prospects
The recent leadership changes raise questions about the future direction of the Dojo project. Venkataramanan's exit, coupled with the departure of another critical artificial intelligence player from Tesla last year, Andrej Karpathy, signals a transition period for the company’s AI and self-driving teams.
However, Tesla's robust talent pool, blending experienced and emerging professionals, offers a silver lining. Bannon's promotion to lead the Dojo project is seen as a strategic move, leveraging his experience and insights gained from his tenure at Apple. Moreover, the recent installation of Dojo hardware in Palo Alto, California, marks a step forward in centralizing and enhancing the project’s capabilities.
Tesla’s ambitions for Dojo extend to making it one of the world’s top supercomputers. The company envisions reaching a computational capability of 100 exaflops* by October 2024, a testament to its commitment to advancing artificial intelligence and self-driving technology.
* Confused about "exaflops?" "Flops" stands for Floating Point Operations Per Second. It's a way to measure how fast a computer can process data. "Exa" means a billion billion, or 1, followed by 18 zeros (1,000,000,000,000,000,000). So, when we say a computer can perform 100 exaflops, it can do 100 billion billion calculations per second. That's incredibly fast!
Tesla is adding a new 'High Fidelity Park Assist' feature in this year's Holiday Update
Tesla
Following initial reactions to Tesla's 2023 Holiday Update, Elon Musk acknowledged the need for improvement, stating, "We need to step up our game." His post on X was followed by Tesla shedding more light on the Holiday Update than what was in the initial leak.
Call me old, but I remember a time when you bought a car, and that was it; the dealer and manufacturer didn’t give you anything else. So is the Tesla community acting a little bit spoiled here? Absolutely. But it also shows how high Tesla has set the bar with its previous Holiday Updates.
Initial Release and Feedback
The initial release of the 2023 Holiday Update, version 2023.44.25, received mixed reactions from the Tesla community, with some owners expressing disappointment over the lack of groundbreaking new features. But the newly announced features may serve as better stocking stuffers.
The initial rollout included something owners have been asking for, the blind spot monitor. The camera that turns on when you change lanes will now have a red color added if there is something in your blind spot. It’s not clear whether it will be accompanied by a tone.
Tesla’s blind spot warning in this year’s holiday update
Here are other features in the leaked update that are being tested by employees:
Navigation and Safety Features: Including symbols for speed cameras, stop signs, and traffic lights in navigation, and the automatic 911 call feature in case of an accident.
Trip Planning via Tesla Mobile App: Allowing for more detailed trip planning, including multiple stops and charging points.
Apple Podcasts Integration: Allowing users to sync with Apple devices for a seamless podcast experience, directly addressing the demand for a richer in-car entertainment system.
New Games and Enhancements: The update brought updates to Tesla Arcade, with Beach Buggy Racing and Polytopia Diplomacy updates, as well as the Vampire Survivors Chilling update.
Light Show Improvements: There’s a new light show that’s included with your vehicle. You’ll also be able to upload several light shows on a single USB drive and pick one from the vehicle, instead of having to use multiple USB drives, one for each light show.
More Live Sentry Mode Cameras: You will now be able to view the B-pillar cameras directly from the Tesla app. This brings the number of viewable cameras in the app up to seven. The only ones still missing are the alternative front-facing cameras that are telephoto and wide-angle, which wouldn’t bring much additional value. Although the B-pillars are viewable in the app with this update, they will still not be used to record during Dashcam or Sentry Mode events.
High-Fidelity Park Assist
Tesla's new parking assist feature will dynamically recreate scenes in real-time
Tesla
In response to the feedback and Musk's statement, Tesla unveiled additional features in its updated holiday update, including an improved park assist with enhanced visualizations.
This feature provides a 3D reconstruction of the vehicle's surroundings while parking, akin to a 360-degree camera system found in other high-end vehicles. The system is clearly leveraging improvements to Tesla Vision to create the surrounding environment, such as cars, pillars and walls.
This feature also appears to change the color of objects depending on how close they are to your vehicle. In the image we can see the pillars are orange, but if we look closer, the object behind the vehicle is also orange near the bottom. The sides of the vehicles next to the Tesla also have a slight hint of orange, indicating their proximity.
However, it looks like this feature may be even better than it initially looks. The vehicles in the image aren’t just predefined 3D models that Tesla created, like the ones used in Autopilot visualizations. These models appear to be dynamically created using vision, so that no two cars would look alike, much more similar to what LiDar is able to achieve. The visualization provides a true representation of the environment around the vehicle. You can see that each vehicle is made up from layers and have blurred edges toward the rear, where the camera would have a hard time seeing.
These 3D models could be a sneak peek at the future of FSD visualizations.
High-Fidelity Park Assist Requirements
A big question on everyone’s mind is who will receive this new park assist feature. Tesla didn’t address this in their post on X besides providing a disclaimer that the features in the holiday release are subject to model and region availability. Tesla often likes to test features in select markets before making them available everywhere. It’s hard to say whether that will be the case here. There likely aren’t any legal ramifications around providing visualizations, so that’s a good sign that this feature will be available in most regions, either in the holiday update, or soon afterward.
However, there are still questions around which models or hardware will be required. From the image shared, we can see it’s offered on a Model Y, removing any speculation of it possibly requiring the HD radar in the new Model S/X. We also don’t think it will require FSD hardware 4.0, so the remaining questions are whether it requires MCU 3, or the FSD package.
Given that Tesla is calling this Park Assist, it doesn’t appear to be linked to Auto Park, which is a FSD package feature. When Tesla rolled out visual and audio alerts for vehicles without ultrasonic sensors, it called the feature Park Assist, and that was available to all owners.
Whether this improved Park Assist feature requires a vehicle with MCU 3 will depend on the level of processing power required. It’ll certainly require more than the current visualizations given that its building the scene in real-time, so we’re hopeful that it’ll work on MCU 2 vehicles too, but we just don’t have enough information right now to make the call.
Custom Lock Sounds
Soon you'll be able to choose a custom locking sound for your car
Not a Tesla App
Tesla also announced a fun and whimsical feature that allows owners to customize the lock sound of their Tesla. No longer will you need to listen to the car’s horn when it locks as you walk away. Now you’ll be able to customize the lock sound of the vehicle. Tesla is including several options, including sounds like a screaming goat, a jingle, a rubber ducky, a quack sound, an old school horn and applause. However, you’ll also be able to upload your own file to create a truly unique experience.
You can pick anything, from a bird’s tweet to a favorite video game sound. You’ll only be limited by the maximum upload file size, which according to a Tesla engineer, is a 1MB file in WAV format, which is roughly about 40 seconds at good quality.
This feature is possible due to the vehicle’s external pedestrian warning speaker. So if you have Tesla’s Boombox feature or your vehicle makes a sound when traveling under 20 MPH, then you should receive this fun enhancement.
Rear Seat Audio and Gaming
You'll now be able to play games on Tesla's rear screens
Tesla
Enhancing the Tesla Arcade experience, passengers in the rear seats can now play games on the rear touchscreen. This feature, especially when paired with Tesla Arcade’s compatibility with PS4, PS5, Xbox Controllers, and rear-screen Bluetooth Headsets, is a welcome addition for families and long trips.
Much like the new Model 3, which received rear audio over Bluetooth support in the 2023.38 update, the new Model S and Model X will also receive this ability in the holiday update.
New Game - Castle Doombad
Tesla announced one other feature in the 2023 holiday update that hadn’t been previously leaked, and that’s a new game called Castle Doombad. Castle Doombad is a single player tower defense, puzzle-like game that’s currently available on iOS and Android, but has an upcoming release on PC and the Nintendo Switch. This game is expected to require MCU 3.
Release Timeline
The rollout of the 2023 Holiday Update is expected to follow a similar timeline to last year. Tesla announced that the update will roll out starting next week. However, it’s not clear whether this will also include FSD Beta testers that are on a 2023.27 update.
Like a spoiled child on Christmas morning, Tesla owners still ask, “Is that it?” Well… possibly, but there may be more to look forward to early next year as Tesla builds off of the new High-Fidelity Park Assist feature.
Advanced Smart Summon: Upgrading the Smart Summon feature to be more intuitive and efficient, especially in complex parking scenarios.
Reverse Summon / Park Seek: What happened to Tesla dropping its passengers and driver off at the location and then finding a parking spot on its own?
Enhanced FSD Visualizations: Expanding the Full Self-Driving visualizations to more regions or models or completely recreating the FSD visualizations using the same neural networks Tesla is using for the High-Fidelity Park Assist feature.
TeslaFi logs your drives and charging sessions, letting you keep a log of your vehice's activity. We highly recommend checking them out if you use your car for business trips and would like to keep track of reimbursements, if you like to see how much you spend on charging or if you just love statistics. Visit their site and see everything they have to offer!
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Tesla Android Project enables you to run Android apps in your Tesla. The platform is Open Source and you can deploy it on your own Raspberry Pi 4. Consider supporting the initiative by donating or purchasing the Compute Module 4 Bundle that delivers the best experience. Get $20 off by using the code: NotATeslaApp
The official Tesla app only notifies you if your car is broken into. By installing Sentry Pro on your phone, you will be notified for all Sentry Mode events. Stay connected and avoid potential surprises by receiving notifications. Stop constantly checking the cameras to ensure safety. Check only when necessary, save battery and get peace of mind. Get a 7 day free trial here!
TeslaBox delivers real-time video notifications for every Sentry and Dashcam event, continuously backs up all footage without hitting record, and enables remote file browsing. No wiring. Installs alongside your standard USB stick.
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