Elon Musk not concerned about Cybertruck demand in Tesla earnings call

During Tesla's financial discussions, Elon Musk referred to the current state of the economy as "unsteady periods." Surprisingly, it seems that the CEO of Tesla is not worried about the popularity of the highly anticipated Cybertruck. Yahoo Finance Live closely examines Musk's remarks from the financial meeting.

PRAS SUBRAMANIAN: Continuing with the automobile industry, let's proceed to Tesla. Yesterday, they released their financial statement. Regarding the Cybertruck, Elon mentioned that there is significant enthusiasm and interest in its demand.

They have provided an update regarding their desired timeline for potential deliveries and production by the end of the year. However, when it comes to demand, he expressed great optimism. Here's his statement.

ELON MUSK: The demand for the Cybertruck is incredibly high. It's beyond imagination. So, that's not a concern at all. I need to highlight that the Cybertruck incorporates an abundance of innovative technology. I mean, a massive amount.

It appears different - it appears unlike any other automobile, simply because it is dissimilar to any other vehicle. Additionally, the pace at which production increases will be determined by the slowest and most improbable component within the complete supply chain and internal production process.

PRAS SUBRAMANIAN: Elon Musk mentioned that the car consists of approximately 10,000 components and systems, and if any of them experience even a slight delay or difficulty, it negatively affects the production speed. This is quite significant for them, especially since they are steadily increasing production of a completely new product.

Adam Jones discussed earlier today how he believes Musk has addressed the worries of investors by soothing their concerns and reassuring them that everything is proceeding as planned. He alleviated any anxieties by emphasizing that we are on schedule and that there is no need to be disheartened as the completion is expected in the current year.

JOSH SCHAFER: It's just incredible to me— we often assess the overall atmosphere during earnings calls. I mean, it's akin to a close friend giving you a buzz and enthusiastically sharing stories about cars.

ALEXANDRA CANAL: He speaks--

JOSH SCHAFER: It pertains to the

ALEXANDRA WATERWAY: --a perplexing enigma.

JOSH SCHAFER: Yup, it's weird. Sometimes I think that after these conversations, his vagueness

ALEXANDRA CANAL: Wow, that encompasses a wide range of topics, doesn't it?

JOSH SCHAFER: You know, that's what-

ALEXANDRA CANAL: It's absolutely amazing

JOSH SCHAFER: --damages Tesla--

ALEXANDRA CANAL: --the hook is practically invisible. It involves a vast amount of advanced technology, a substantial amount indeed. Similar to--

What's the significance of that?

JOSH SCHAFER: What is the significance?

JOSH SCHAFER: So, what is the real need? Can you provide any kind of measurement for this need? In one instance during that financial conference, he essentially expressed that the analysts were attempting to become too precise. He suggested that we should move forward without dwelling on it. I can't recall his exact words though.

PRAS SUBRAMANIAN: When it comes to gross margins, we are delving into too many specifics. It is not something we can accurately measure. Various factors like rates, global market conditions, and uncertainties hinder us from providing an actual forecast for gross margins. Many companies may offer predictions for gross margins, but considering the unpredictable nature of the world, it is challenging.

JOSH SCHAFER: And what was the main focus of discussion during the call? Gross profit margins.

JOSH SCHAFER: However, considering today's performance, the stock experienced a significant drop of nearly 10%.

JOSH SCHAFER: Because when they sought information about their profit margin, suggestions, he simply refrained from providing it. I fail to comprehend why, at some juncture, he wouldn't just furnish slightly more precise responses when individuals are seeking them.

PRAS SUBRAMANIAN: Well--

JOSH SCHAFER: -pertaining to particular-

PRAS SUBRAMANIAN: --can you observe the pattern? It's steadily declining. The matter to consider now is, has it hit rock bottom? And there was no response to that inquiry. The stock experienced a significant increase. Thus, the subsequent 10% plunge does not astonish me.

ALEXANDRA CANAL: Absolutely, indeed. Furthermore, despite the soaring demand, I understand that one of your major worries is whether there will be an adequate supply to sustain it.

Can Alexandra keep up with the requests? Because that's something we've observed with Tesla. It has proven to be a problem.

PRAS SUBRAMANIAN: Oh, there has never been an issue with demand.