TSLA Market Action: 2018 Investor Roundtable

[Zhelko Dimic]

You poke fun but there are people on other forums that are seriously trying out this new short goal post movement.

Well...
I don't doubt demand in general, but demand in US only, for people ready to buy right now, cars starting at $50K+, yeah, I can see some (low) probability Tesla may have to pull a lever or two during the next 6 months to flush out all the money from the mattresses... Now, we know Tesla has those levers, but just the fact of Tesla pulling them, may create noise and FUD.

 

[jelloslug]

Well...
I don't doubt demand in general, but demand in US only, for people ready to buy right now, cars starting at $50K+, yeah, I can see some (low) probability Tesla may have to pull a lever or two during the next 6 months to flush out all the money from the mattresses... Now, we know Tesla has those levers, but just the fact of Tesla pulling them, may create noise and FUD.

The average new car price in the US is over $35k. The market that the Model 3 is in typically has sales of ~25,000 cars a month. There is pent up demand for the car and there are people that are moving into that market for the first time. All of those things combined let the Model 3 have strong sales for the foreseeable future.

 

[Zhelko Dimic]

The average new car price in the US is over $35k. The market that the Model 3 is in typically has sales of ~25,000 cars a month. There is pent up demand for the car and there are people that are moving into that market for the first time. All of those things combined let the Model 3 have strong sales for the foreseeable future.

I think we are saying the same thing, with different emphasis. I don't doubt Tesla can sell half of million M3 cars in the world once full $35K-$100K range is complete. I mean BMW sells 546K Series 3, and I think M3 will do better.
But when you back away rest of the world, and back-away $35K-$50K segment, pool is certainly smaller.
And I don't know these numbers, but if M3 is in a market that sells ~25,000 cars a month, it may be hard to pick up 20,000+(5K a week) of these sales a month, past first 6 months.
Before I'm accused of spreading FUD, I am not concerned for Tesla sales, either now or 6 months from now. Tesla will just need to work on managing and balancing right mix of supply with demand. And I'm confident they'll get it right.

 

[wipster]

The average new car price in the US is over $35k. The market that the Model 3 is in typically has sales of ~25,000 cars a month. There is pent up demand for the car and there are people that are moving into that market for the first time. All of those things combined let the Model 3 have strong sales for the foreseeable future.

Coupled with the facts that:
- Tesla had actually been trying to suppress orders until production was able to keep up, but now that's not the case
- They are sending out M3's to the showrooms now so that people can actually drive one before they buy
- M3 owners are beseiged by onlookers and question askers wherever they go
- 3 major holidays which bring family and friends together are happening in the next 6 months and you can bet there will be quite a few test drives happening then.
- The quality of the product coming off the line is the best so far from what I've read recently
- Based on what I've read so far, I anticipate some glowing reviews from major car mags, blogs, and video reviews
- The Q3 and Q4 financials should answer any questions about Tesla's fiscal health in a very positive way.

Barring any major calamities, I think we may finally be turning the corner. I sure hope so at least...

 

[jelloslug]

Coupled with the facts that:
- Tesla had actually been trying to suppress orders until production was able to keep up, but now that's not the case
- They are sending out M3's to the showrooms now so that people can actually drive one before they buy
- M3 owners are beseiged by onlookers and question askers wherever they go
- 3 major holidays which bring family and friends together are happening in the next 6 months and you can bet there will be quite a few test drives happening then.
- The quality of the product coming off the line is the best so far from what I've read recently
- Based on what I've read so far, I anticipate some glowing reviews from major car mags, blogs, and video reviews
- The Q3 and Q4 financials should answer any questions about Tesla's fiscal health in a very positive way.

Barring any major calamities, I think we may finally be turning the corner. I sure hope so at least...

There were about 100 Model 3s at the Charlotte, NC service center this morning with the entire front row lined up by color for all of the traffic to see.

 

[wipster]

There were about 100 Model 3s at the Charlotte, NC service center this morning with the entire front row lined up by color for all of the traffic to see.

That just makes me a Happy Boy!

(courtesy of the late great Country Dick Montana)

 

[jelloslug]

That just makes me a Happy Boy!

(courtesy of the late great Country Dick Montana)

My jaw dropped when I saw them all. The Charlotte store has had difficulties recently because Hendrick Motors managed to get their selling license pulled. After that, the lot almost always stays empty. When I came over the hill and saw the lot completely packed with Model 3s, it was a sight to behold.

 

[Menifeer]

There were about 100 Model 3s at the Charlotte, NC service center this morning with the entire front row lined up by color for all of the traffic to see.

If I didn't know anything about Tesla, my immediate thought would be along the lines of, "They must not be able to sell those things...".

 

[wipster]

If I didn't know anything about Tesla, my immediate thought would be along the lines of, "They must not be able to sell those things...".

Methinks they won't be there long...

 

[jelloslug]

If I didn't know anything about Tesla, my immediate thought would be along the lines of, "They must not be able to sell those things...".

It must be generating some foot traffic because when I was there on Monday afternoon, the showroom was packed.

 

[jelloslug]

Methinks they won't be there long...

I was there on Monday and today and many of them had been rotated out and replaced with new ones. When I pulled up, they were unloading two car transporters full of Model 3s right then.

 

[mrdoubleb]

Two more years without a Model 3? I’ll take my chances.

I didn't mean wait until 2019 or 2020. Just maybe don't buy the first 2500 VINs. Well, at least I wouldn't. Hopefully someday they'll have the ability to achieve VIN 10k quality with the very first consumer car off the assembly line.

 

[MXWing]

I didn't mean wait until 2019 or 2020. Just maybe don't buy the first 2500 VINs. Well, at least I wouldn't. Hopefully someday they'll have the ability to achieve VIN 10k quality with the very first consumer car off the assembly line.

You won’t be able to get the first 2500 VINs even if you wanted too! Too much demand for people willing to dive right in. I’m sure many would volunteer to be the first human cargo launched on a Falcon.
Not hubris but that’s the brand support.

Tesla just needs to reach escape velocity of cash burning and show it can make profits.

 

[wipster]

I didn't mean wait until 2019 or 2020. Just maybe don't buy the first 2500 VINs. Well, at least I wouldn't. Hopefully someday they'll have the ability to achieve VIN 10k quality with the very first consumer car off the assembly line.

But in my experience that's true for the first model year in many, if not most, new cars. It was true of Explorers, it has been true for several models of Mercedes, and many more. The beauty of Teslas is that except for mechanical problems, a lot of what would typically go into a dealer for repair is done online, when you're sleeping! If they could get the vast majority of issues corrected in the first 10k built, that's better than anything Detroit, Stuttgart, or Tokyo has ever done. And I sense the mY will be even better.

The times they are a'changing...

 

[elasalle]

Ha, I'd love to heat up the baked beans and veggie dogs. When do you think we'll get back to my favorite campsite?

Short squeeze should take us beyond 400 and I think that needs at least 2 quarters of profits - but confirmation of sustained 5k/wk in earnings/cc might be enough for 370 ...(provided macros and upcoming earnings overall are good )

 

[Dennisj00]

But in my experience that's true for the first model year in many, if not most, new cars. It was true of Explorers, it has been true for several models of Mercedes, and many more. The beauty of Teslas is that except for mechanical problems, a lot of what would typically go into a dealer for repair is done online, when you're sleeping! If they could get the vast majority of issues corrected in the first 10k built, that's better than anything Detroit, Stuttgart, or Tokyo has ever done. And I sense the mY will be even better.

The times they are a'changing...

But did those Explorers or Merck’s have 400,000+ reservations?

 

[wipster]

But did those Explorers or Merck’s have 400,000+ reservations?

Ha! I think not... Most were off the lot inventory I would suppose.

 

[bdy0627]

If I didn't know anything about Tesla, my immediate thought would be along the lines of, "They must not be able to sell those things...".

I'm sure many shorts are concluding just that. Production solved, hello demand problem!

 

[Ugliest1]

My jaw dropped when I saw them all. The Charlotte store has had difficulties recently because Hendrick Motors managed to get their selling license pulled. After that, the lot almost always stays empty. When I came over the hill and saw the lot completely packed with Model 3s, it was a sight to behold.

I did a quick search on TMC but was unable to come up with the current status of Tesla's license in Charlotte. Can they sell now? The license-pulling was in 2016 and I can't remember if Tesla won on an appeal or not.

 

[bdy0627]

According to Skabooshka's production info posted on twitter (don't know how reliable), production is dropping again. Speculation on twitter from bears seems to point to paint shop as the rate limiter. Any thoughts on why production would spike for a few days to ~700 model 3 per day and then drop down again?

On July 17, 2018 Tesla produced approximately:
Model 3: 400
Model S: 140
Model X: 160