Perhaps it's all part of a bigger destiny to eventually down the road in 5-10 years that will bring SpaceX and Tesla (and Boring Company and Neuralink, etc) altogether under one umbrella called X (website will be x.com) as a private company that will remain private indefinitely. Perhaps that would be Elon's ultimate preference.
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I think going private is the best for achieving Tesla's mission and the best for long term shareholders.
Shorts don't just spread FUD. When they have so much money on the line to lose, they might do crazy things. I am a permanent long, but desperate shorts could think of several illegal ways to completely destroy Tesla.
I hope Fidelity set up a special fund. I can open two accounts at Fidelity, one regular account and one retirement account. I transfer my Tesla shares into these accounts. Then they convert my shares proportionally to the shares of the special fund, hopefully it's a non taxable event because I still own the same percent of the company, no liquidation in the process.
Zhelko Dimic
Careful bull
I agree with everything you are saying, including that if I could stay in private TSLA, I'd put some 50-70% of my equity in, rather than all in that I'm now. Yet, I'd actually prefer to trade my freedom in order to 1) have Tesla that is less attacked 2) have investment vehicle that prevents me from obsessing over the price
- but this comes from understanding myself and my fallings and having relatively high level of comfort with Tesla the company. And you'll probably remember that I was critical of the Musk occasionally, including thinking that this move isn't quite fair - this is probably unique point in Tesla's history when he can get it done. Before this quarter, future was too uncertain to get this much capital, in couple of quarters, TSLA may be too expensive to buy in this fashion. So, we're getting a bit of a raw deal, but it's not outright horrific, so, whatever...Oh, I'm voting against for sure at this price. $450 may make me change my mind (just may). Even if this means we drop to $300 if vote fails...
Also I think $420 is a pitifully low price to take Tesla private at.
I agree that $420 at this point in Tesla time is too low an offer to be worthwhile to entertain on its own. The problem is that we’re held hostage with the near certainty that should the deal fail, price will fall a lot lower than $300. It’s going to be a real reset.
Mario Kadastik
Active Member
I wouldn't be so heavily invested in Tesla (have a company that depends 100% on Tesla as we are a rental/taxi business exclusive to Teslas). Also, I've been following Elon for a decade. If he's actually an evil fraudster then he's failing spectacularly at being an evil fraudster. Both SpaceX and Tesla are companies on a mission and both are delivering. The only thing I agree with is that Elon time is a real thing and one has to account for it. But his goals are not a question at all.
The majority of FUD is just that, FUD. If there is an occasional fact in there, that's firstly unlikely, but secondly oh well, she who cried wolf... The fudsters have been so ridiculously wrong so many times and it's been so obvious that their credibility is at 0%.
Tesla isn't overvalued. It just means you cannot assign it value using your assumptions. Under my assumptions Tesla is waaay undervalued or to be more precise the execution risk discount is quite high. I have no doubt that Tesla will be a major player in many sectors in the coming decades, timelines might be off 3-5 yeas on some things, but considering the rest of the market and competition that's not really a problem. Let's just say that I see Tesla as the top carmaker in the world, major grid utility in many many many regions down the path. The question is wether that's 10y, 20y or 30y in the future. In any case the company isn't overvalued. Risks vary and stock price with it, but this is mouse nut arguments and one of the reasons Elon wants to take the company out of the Wall str mania of Q-o-Q reporting.
Why ugly? The quarterly reports have been pretty much what we've been expecting throughout the years. There have been more positive surprises for us than negative ones. The fact that you cannot fathom a negative EPS QR being a good one shows your limited vision in investing.
Declining service quality and related to it the sales plunge is indeed partially caused by shorts. I think it's relatively sure that the constant attack of shorts did create a liquidity event where Tesla wasn't able to raise capital when it should have due to heavy FUD causing the bond and finance markets to get more cautious. This made Tesla go on a diet internally meaning also reducing the rollout of service centers and creating bigger spare part pools. In a market where Tesla could have taken any amount of capital those problems wouldn't have happened and it was somewhat caused by shorts and somewhat by management. Well noone's perfect and I've personally felt the service quality and parts deficit. Then again, it's still mostly better than many other manufacturers and I attribute some of the service attitude to Finnish culture...
They have installations, also non-employee ones. But as I understood there were some initial installation discoveries that they thought better to improve on before rolling out massive scale production. Reasonable and not everything can be lab tested.
In 4-6 weeks.
First elements 4-6 weeks, but it was quite clear that it was a future option that will not be activated for a while and will also depend on regulatory approval. This was stated clearly during purchase. Buying that gives me now free HW3 upgrade for example and as it was just 3k when I bought the car then 3k on a 115k car that I financed was a minuscule difference in monthly payments, but future proofed the car.
Nothing happened to it. They bit at it too much too early. Had to scale back somewhat, revise and are continuing on it. It's still coming and we knew the Model 3 line would be AD v 0.5, not 1.0. The GA3 line was just built too tight and needed to be revised somewhat, the design will evolve and automation % will keep increasing. I don't understand if you've been following this topic at all or not? Elon and team have clearly stated this in conference calls and elsewhere.
Shorts are spinning things out of proportion forcing the company to change plans and force things at times. In a fully private company or one that's not attacked by FUD we'd have <10% of the complaining and on valid topics, that would indeed improve the company as they take the feedback. But it's hard to find the true nuggets in the pile of horse *sugar* that shorts stream all the time.
Well you are in the boat of never believing anything even when 90% of Elons promises have all been delivered, you still have a mental image of him only promising. That's sadly the side effect of being unable to understand his work methodology and how that results in missed promised deadlines, but still faster delivery to market than other methods and sadly if you only read headlines the image of Elon and Tesla is a mirage not correlating to the actual man and his deeds.
as I understand Tesla will build a public investment fund with the single target as investment. They were talking about doing something like that for SpaceX for ages, and didn't do because they never had problems with rising capital quite yet. The scale of expected growth in Tesla is actually bigger, the number of retail investors is high, and the costs of loosing them now is high enough to shadow costs of building such fund. I don't understand panic here.
Any thoughts on whether or not it might just be an opening offer to leave him some room to raise it later? I mean, if he gets feedback that some big shareholders aren't sure, he could raise it to say $450 to convince them.
I am possibly misunderstanding something, but how does that fundamentally make a difference? Because either this fund is publicly traded and then it is just trading Tesla by proxy which would be worse for regular investors than before and still leave this fund open to shorting/FUD targetting etc. Or it is private with limited trading and then the same issues people are raising here because holding privately traded shares is for some just not possible or financially punative.
My guess is that Elon - before he tweeted this - did talk to some of the biggest investors and got a green light from at least 51% of the votes. So no need to raise it to convince them. But he may have plans to raise it anyway - to meet the arguments that the price is to low (which would come anyway whatever the start bid would be).
Tesla's problems are not shorts. The problems lie in financing issues and quarter cycles, and many other reoccurring costs related specifically to public companies.
Dude, I understand it's your job to FUD forum, but I do advise just for your self-education to read about privatization of public companies and why it's very cool thing since 2000s.
davecolene0606
Member
While I find the discussion of reasons to remain public compelling, I have to say that this whole thing is entirely dependent on the structure that surrounds the equity. Elon has said that he would like all current stock holders to be able to transfer to the private equity and has also referred to the SpaceX model to indicate that some form of a fund will be initiated to house the private shares of the thousands of retail investors. Also, the method of going private is not an LBO as existing shareholders will not be compelled to surrender their shares as a result of the buy out.
I am in the boat where I have a few shares in a regular brokerage some in an IRA and some in an Employer 401K brokerage option. I definitely have an interest in holding my shares for at least another 5-10 years to support retirement. I of course am very concerned that I will have to liquidate if there is no vessel that I am able to hold shares in. So, until we know Tesla's structure for that vessel it is very premature to support or not support the proposal.
What is most distressing is the prospect of not being able to participate in future upside. Having said that, my worst case is that we will have to rollover the IRA held stocks to a Directed IRA and pay the fare annually, transfer our brokerage share to private status and liquidated the Employer 401k brokerage shares which equals about 57% of our shares. I have been told that the plan administrator on a case by case basis can authorize the holding of a private equity in the plan. If that happens then no harm no foul.
I am withholding a yay or nay for now but here is what I would like to see if its going to be taken private.
1. Most of the transaction occurs via shareholders retaining shares and transitioning to private equity status. (less $ to do deal)
2. Fund structure that allows maximum number a shareholders to retain ownership. Specifically, a structure that would allow access for foreign owned shares and retirement plan shares. So maybe a limited access fund structured to make it accessible to IRA/401k/directed retirement schemes. (uncommon territory here)
3. Access to financial information to allow transparency to the shareholders. I am talking quarterly calls where shareholders can be the callers rather than analysts along with equal info. I would envision that the info would be confidential and as a shareholder one would acquiesce to an NDA with share removal as the stick to disclosure.
4. Quarterly liquidity events along with the calls.
With the above being components of the deal I definitely would have zero heartburn goin private. I am confident that Elon in fact has the interest of long term shareholders at heart. I think we as the retail investor community can come up with an ideal structure and propose it to Elon and the board. We have some serious brain power here and now is the time to put it together. I know from years of union negotiations that one of the first principles is "you never get what you don't ask for" and "providing a path of least resistance is the easiest way to a yes"
I see definite advantages to being private for Tesla during the next 5 years or so that have to do with flexibility in asset management that are difficult to execute in a publicly traded company. While I see the loss of liquidity as a short coming and the public forum for societal inspiration as a short coming, I think the promise of execution of the products far out weigh the aforementioned.
My 2 cents so far.
Fire Away!
I am in the boat where I have a few shares in a regular brokerage some in an IRA and some in an Employer 401K brokerage option. I definitely have an interest in holding my shares for at least another 5-10 years to support retirement. I of course am very concerned that I will have to liquidate if there is no vessel that I am able to hold shares in. So, until we know Tesla's structure for that vessel it is very premature to support or not support the proposal.
What is most distressing is the prospect of not being able to participate in future upside. Having said that, my worst case is that we will have to rollover the IRA held stocks to a Directed IRA and pay the fare annually, transfer our brokerage share to private status and liquidated the Employer 401k brokerage shares which equals about 57% of our shares. I have been told that the plan administrator on a case by case basis can authorize the holding of a private equity in the plan. If that happens then no harm no foul.
I am withholding a yay or nay for now but here is what I would like to see if its going to be taken private.
1. Most of the transaction occurs via shareholders retaining shares and transitioning to private equity status. (less $ to do deal)
2. Fund structure that allows maximum number a shareholders to retain ownership. Specifically, a structure that would allow access for foreign owned shares and retirement plan shares. So maybe a limited access fund structured to make it accessible to IRA/401k/directed retirement schemes. (uncommon territory here)
3. Access to financial information to allow transparency to the shareholders. I am talking quarterly calls where shareholders can be the callers rather than analysts along with equal info. I would envision that the info would be confidential and as a shareholder one would acquiesce to an NDA with share removal as the stick to disclosure.
4. Quarterly liquidity events along with the calls.
With the above being components of the deal I definitely would have zero heartburn goin private. I am confident that Elon in fact has the interest of long term shareholders at heart. I think we as the retail investor community can come up with an ideal structure and propose it to Elon and the board. We have some serious brain power here and now is the time to put it together. I know from years of union negotiations that one of the first principles is "you never get what you don't ask for" and "providing a path of least resistance is the easiest way to a yes"
I see definite advantages to being private for Tesla during the next 5 years or so that have to do with flexibility in asset management that are difficult to execute in a publicly traded company. While I see the loss of liquidity as a short coming and the public forum for societal inspiration as a short coming, I think the promise of execution of the products far out weigh the aforementioned.
My 2 cents so far.
Fire Away!
[ I don't know what's more sad... that Tesla is likely to go private or that people largely don't question it.[/QUOTE]
Dave, I think there are 2 general categories of TSLA investors (investors, not traders).
The first says, Hey this is a great investment in which I can make lots of money (and they have this overall mission that I agree with).
The second says, Hey this company has a great mission that I agree with (and I can make a lot of money in it).
They are going to see things in fundamentally different terms. It's not sad. Its just different ways of thinking.
Dave, I think there are 2 general categories of TSLA investors (investors, not traders).
The first says, Hey this is a great investment in which I can make lots of money (and they have this overall mission that I agree with).
The second says, Hey this company has a great mission that I agree with (and I can make a lot of money in it).
They are going to see things in fundamentally different terms. It's not sad. Its just different ways of thinking.
The "problem is", to use your terms, is that he would not have made this announcement if he had not cleared this plan and price with the biggest shareholders already. So passing this deal should only be a formality. He can easily get the 2/3 majority by having the main shareholders in his corner. With that, it does not matter at all how you vote, so you don`t need to worry about your personal "no" vote crashing the stock.
Honestly as a long having planned to stay with TSLA for the next 5-10 years as they become what i would expect to be one of the largest and most profitable companies, I would not care so much if i could be certain i can stay on as a shareholder.
This is very clear to me: Elon will not take Tesla private unless he has super voting rights or somehow controls 51% of the vote.
And if that wasn't the case I would not invest in it. My Tesla investment is an investment in Elon Musk more than the company. The last thing I want to invest in is a Tesla run by committee - especially if that committee is just a bunch of number crunching asshats looking to maximize short term returns at the expense of long term mission.
Mike
What do you make then of his tweet from the day before yesterday about not having a controlling vote now and not expecting any shareholder to have one going forward?
Elon can’t guide low.
He has set hyper-optimistic deadlines for years. This is his modus operandi. It has worked for him forever. He states public goals that are exactly the same as the goals set for the employees.
This drive’s maximum productivity and is a key component in how quickly his companies move. The employees know that he is not setting some really high bar internally but yet they have a lower bar publicly (I.e. an out). There are now Ted talks about the effectiveness of setting hyper optimistic deadlines, but this is something Elon has known forever. Gwynne Shotwell also discusses this in a recent interview.
All employees work harder and are more inspired and Elon’s companies move more quickly.
Space-X employees would not be as motivated to reach Mars in a realistic 15 years, and Tesla employees would not be motivated to make a small difference in sustainability over a decade from now.
I can not stress strongly enough how important it is that Elon does not guide low.
So, there's a difference between
-- The SEC definitions of "public" (has to file reports) and "private" (can't have more than 2000 stockholders, etc)
-- the common meaning of "private equity" (unlisted shares which don't trade) vs. listed shares.
I am really, really hoping that Tesla's plan is to remain *public* for SEC purposes but go *unlisted* and add a "first right of refusal" buyback provision for stockholders, so that they are not traded on the stock markets. I believe this actually allows non-accredited investors to keep their stock.
If Musk's plan is to actually "go dark" it forces out a lot more people, or puts us into layers of fee-slurping fund managers. Not cool.
I actually tweeted to Musk asking about the possibility of being an *unlisted* public-for-SEC-purposes company. Because I think I'd be much much happier with that, as would we all...
-- The SEC definitions of "public" (has to file reports) and "private" (can't have more than 2000 stockholders, etc)
-- the common meaning of "private equity" (unlisted shares which don't trade) vs. listed shares.
I am really, really hoping that Tesla's plan is to remain *public* for SEC purposes but go *unlisted* and add a "first right of refusal" buyback provision for stockholders, so that they are not traded on the stock markets. I believe this actually allows non-accredited investors to keep their stock.
If Musk's plan is to actually "go dark" it forces out a lot more people, or puts us into layers of fee-slurping fund managers. Not cool.
I actually tweeted to Musk asking about the possibility of being an *unlisted* public-for-SEC-purposes company. Because I think I'd be much much happier with that, as would we all...
The way I see it is fairly simple.
Going public is the best way to raise the largest sums of cash to fund your operations.
Going private is the best way to execute on your mission with minimal investor interference.
Elon's now got the means to raise cash without the public's help. The team will be able to execute at the highest level possible with little to no interference from outside money. Look at what SpaceX has been able to achieve as a private company - I would argue that their achievements are on a scale much larger than Tesla. Yet Tesla can very easily have the same level of execution if it can also focus and hunker down on long term, very big, sometimes "impossible" goals, without having to answer to quarterly requirements from investors questioning their every move.
The biggest thing for me however is that it's going to allow Elon to have much less stress in his life. He's not going to have to worry about what investors are saying, or what short sellers are trying to do to damage his company's reputation. And in the end, the most important thing for Tesla is its leader's health, and going private will be a great step towards achieving a healthier life for Elon.
I will vote to take the company private.
Going public is the best way to raise the largest sums of cash to fund your operations.
Going private is the best way to execute on your mission with minimal investor interference.
Elon's now got the means to raise cash without the public's help. The team will be able to execute at the highest level possible with little to no interference from outside money. Look at what SpaceX has been able to achieve as a private company - I would argue that their achievements are on a scale much larger than Tesla. Yet Tesla can very easily have the same level of execution if it can also focus and hunker down on long term, very big, sometimes "impossible" goals, without having to answer to quarterly requirements from investors questioning their every move.
The biggest thing for me however is that it's going to allow Elon to have much less stress in his life. He's not going to have to worry about what investors are saying, or what short sellers are trying to do to damage his company's reputation. And in the end, the most important thing for Tesla is its leader's health, and going private will be a great step towards achieving a healthier life for Elon.
I will vote to take the company private.
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