TSLA Market Action: 2018 Investor Roundtable

[Zhelko Dimic]

Ignore the first part of my previous post, I'm still fighting with the editor... Another thing though: If I remember correctly, Elon said that the Model Y production line will be another level. They may fundamentally rework the production at Fremont to get to 10K (if that still is a viable goal).

Hopefully not, thank you very much.
I'd like them to conquer this level first, and not just squeak by on boosts and hacks..

 

[K_Dizzle]

Heh, wasn't going to comment on wallstreetbets, but since someone else did it for me.

The first day of the stock price fall was basically Real wall street margin calling all the FD from WSB. I am pretty sure that some professionals have started monitoring and margin hunting them as every single stock they've been buying FD on has fallen in the past month and wiping them out.

Wow shots fired

 

[Zhelko Dimic]

It's still only your guess. And I already said even if it will reach 7000 it will be temporary when Tesla ramp up export, only to give short more talking points, except this time a valid one.

There are many reasons why Tesla may not reach more than 7000 per week for model 3 at sustained rate. After reaching cash flow positive they have the luxury to frequently twick the pipeline to further reduce cost. Currently most robots are still blind. Adding vision to the system and training eye-hand coordination of the robots may also cause pipeline pauses.

And there are model y, pickup, next gen s and x, etc, which also take resources

7000-8000 may be a safe spot to park production, unless it's a line that can interchangeably build Model Y.
I don't doubt demand now, but after Model Y is introduced, and if Tesla wants to gravitate towards $50K average sale price, rather than 40K average, I don't think they should exceed 400K a year.
Of course, what do I know? If production becomes cheap enough, they may go for more basic models in the sale mix, and try to become more ubiquitous than BMW Series 3, rather starving German car industry of the oxygen...

 

[Zhelko Dimic]

Heh, wasn't going to comment on wallstreetbets, but since someone else did it for me.

The first day of the stock price fall was basically Real wall street margin calling all the FD from WSB. I am pretty sure that some professionals have started monitoring and margin hunting them as every single stock they've been buying FD on has fallen in the past month and wiping them out.

And in English? I actually tried to understand it...

 

[RichardL]

I would be interested to see details of how many cars an individual line for Ford or Toyota produce a week, to compare with the apparent 2500/wk for each M3 line.

When they produce 30000/month Camrys, presumably that is not a single, very productive line?

According to Wikipedia, the Toyota factory in Kentucky has three lines producing a total of 550K/yr - which by my math is around 4K/wk each. So not that vastly superior to the current state of the M3 lines. Or am I misunderstanding?

 

[UnknownSoldier]

And in English? I actually tried to understand it...

I understood it just fine. I don't know if that's a good thing or not.

 

[jbih]

According to Wikipedia, the Toyota factory in Kentucky has three lines producing a total of 550K/yr - which by my math is around 4K/wk each. So not that vastly superior to the current state of the M3 lines. Or am I misunderstanding?

NUMMI produced 428,633 units in 2006, so 8.5k per week. Tesla also has very high vertical integration, so these numbers are not directly comparable. Considering this, 7K per week is actually quite nice!

 

[scaesare]

NUMMI produced 428,633 units in 2006, so 8.5k per week. Tesla also has very high vertical integration, so these numbers are not directly comparable. Considering this, 7K per week is actually quite nice!

Yup.

And what's more, explains why aiming for 10K/wk may be pushing the limits of the existing factory, and more floor space was necessary.. hence the tent sprung structure. This is even moreso with the amount of vertical integration and part production Tesla has pulled in-house....

 

[Reciprocity]

As a few have been asking, Tesla Daily did a nice podcast all about shorting: Tesla Daily: Tesla News & Analysis by Rob Maurer on Apple Podcasts

Please listen to this podcast. You will understand what we are up against on Twitter. And why some of us have taken to Twitter to counter the fud with facts. These people have zero compunction about lying and making things up. Tricking employees to spy and sabotage. They control some in media as well.

 

[TrendTrader007]

$TSLA my challenge to short sellers: if you can breach $300 on a closing basis and sustain it then i will be impressed; until then it's just conversation @elonmusk

 

[sundaymorning]

Please listen to this podcast. You will understand what we are up against on Twitter. And why some of us have taken to Twitter to counter the fud with facts. These people have zero compunction about lying and making things up. Tricking employees to spy and sabotage. They control some in media as well.

I agree. FUD is at an all time high, while we are closing in on cash flow positive, nothing should be taken for granted. Best to be on the offensive and take to social media and do your part. Even if it’s one or two comments a day it’ll help spread awareness. Just like the engineers who took their efforts to GA4, we can’t be sitting at our desk looking at the TSLA ticker symbol all day.

 

[geometro]

Just don't use acronyms. Too specialized. Doesn't help communicate, only hinders communications.

NMA, baby!!!
(“No More Acronyms”)

 

[mmd]

According to Wikipedia, the Toyota factory in Kentucky has three lines producing a total of 550K/yr - which by my math is around 4K/wk each. So not that vastly superior to the current state of the M3 lines. Or am I misunderstanding?

Hyundai's factory: The biggest in the world
No plant builds more cars a year than Hyundai's remarkable Ulsan facility in South Korea.
- a sprawling mass of five different factories that churn out a vehicle every 10 seconds, with production last year hitting a barely credible 1.53 million.
- 15 million square metres - the equivalent of 700 football pitches - five different factories produce 14 different models
- No less than 34,000 employees work at the plant, on a two-shift system - from 6:45am to 3:30pm, then 3:30pm to 12:30am. .. in theory there's scope for Ulsan to become even more productive, as the plant runs for only five days a week, shutting at weekends and for a full week in summer.
- Slightly more eye-opening were the facilities for the workers. We passed one water feature, entitled 'Green Park', intended to create a more pleasant working environment. It was probably paid for via the annual £2.1m landscaping bill (there are 590,000 trees at Ulsan).
- From production line to port, Ulsan has it down to a fine art, setting a blueprint for efficient production on a huge scale virtually every car maker in the world would love to emulate.

 

[bdy0627]

May be you are all giving too much credit to Elon for his longer term stock moving power. He was right one time 5 years ago. Isn't a broken clock right more often?

But here is also what he said just a week ago, and how it unraveled.
Elon Musk says naysayers are in for a 'rude awakening' about Model 3 production numbers (TSLA)
Tamberrino: Tesla will deliver 22000 Model 3 vs. 28000 consensus estimate for Q3.
Elon's leaked email: "They're in for a rude awakening "
(Elon said nothing when Erikson estimated 30000 Model 3 deliveries; or it didn't leak. )
Actual Model 3 deliveries: 18440

Yeah, I did consider that the rude awakening could've been meant for some other people.

I think this whole hoopla over 5k for a week or 6k for a week in August is meant as a big distraction from the real misses and financials. All the talking heads on TV and newspaper are now talking about this, instead of the actual quarterly numbers as they do for all other companies.This was front page news in SJ mercury news last week!

So, now I'm thinking, what should I expect for the "short explosion"?
Will my negative position of -$X (due to short) become positive by exploding? Or will the number of shares shorted explode, so the total short position explodes? This is a tough one.

Anyone else find it interesting that Tamberrino released a note on June 26 predicting that Tesla would "miss" on model 3 deliveries, coming in below "consensus," rather than focusing on Tesla's production guidance? Here's the CNBC quote:
"Goldman Sachs is reiterating its sell rating on Tesla and expects the electric car maker's widely watched Model 3 delivery number to fall short of Wall Street expectations."
Goldman reiterates sell on Tesla and expects Model 3 deliveries to miss estimates

I find his note interesting for a couple of reasons. Until this point, the widely watched metric has been Model 3 production. Why the switch this time to focusing on analysts consensus of deliveries rather than production? Tesla had guidance for production, not for deliveries. In a previous note from March 19, he kept his rating at sell, focusing on a production miss:
“Assuming that the last few weeks in March have a similar 1k/week production rate, we see total 1Q18 Model 3 production registering at approximately 9,500 vehicles,” they said. “That production rate would fall below guidance of exiting the quarter at a 2,500/week run-rate."
Tesla stock is still a sell at Goldman Sachs

That previous note focused on an average production for the quarter, which was also not something that Tesla had guided for, but note that it was focused on production as the metric. This time, it appears that Tamberrino had gotten the message that Tesla was going to meet production guidance. So, what to do, what to do? Remember, he has a $190ish price target to support. Oh, wait, deliveries appear to be down (for whatever reason), so let's focus on that and ignore the production. What was his stance about the production? "Tamberrino wonders how sustainable that rate is." Talk about moving the goalposts to make sure Tesla appears to have failed. Tamberrino is not unique in this. Several analysts switched their focus to deliveries rather than production, since Tesla did in fact meet guidance. There simply was no delivery guidance from Tesla. The analysts spun the data toward their bearish stance on Tesla. The analysts can come up with whatever consensus they want, based upon whatever metric they want to focus on, and there isn't a thing Tesla can do about it. Expect the analysts to be even worse with the Q2 financials next month. However, my guess is that since everyone knows Q2 financials will be bad and will expect the stock to tank, it probably won't. Bad Q2 financials certainly won't be a surprise to anyone following Tesla.

 

[Causalien]

And in English? I actually tried to understand it...

/r/wallstreetbet is a subreddit where lots of users buys short term OTM calls with margin and openly posts their positions. A lot of the time, a crowd of users will pile into the same position.

I have a guess that some professional traders have decided to hunt these people's money down by causing margin calls on their positions.

 

[UnknownSoldier]

NUMMI produced 428,633 units in 2006, so 8.5k per week. Tesla also has very high vertical integration, so these numbers are not directly comparable. Considering this, 7K per week is actually quite nice!

Yes, it's surprising how few people realize that NUMMI was just a general assembly plant. Tesla is doing a lot more things than just general assembly inside the old NUMMI building. But there's no doubt they are out of space, they cannot expand unless they begin building cars in Nevada or break ground on Shanghai and Europe Gigafactories.

 

[bdy0627]

Yes, it's surprising how few people realize that NUMMI was just a general assembly plant. Tesla is doing a lot more things than just general assembly inside the old NUMMI building. But there's no doubt they are out of space, they cannot expand unless they begin building cars in Nevada or break ground on Shanghai and Europe Gigafactories.

Hmmm. Could they realistically use the GF to build cars?

 

[Krugerrand]

You put that "Kick Me" sign on your shirt while you were getting dressed today.

Yesterday. Today I’m wearing the “I’m kind of a big deal” t-shirt.

 

[wipster]

Yup.

And what's more, explains why aiming for 10K/wk may be pushing the limits of the existing factory, and more floor space was necessary.. hence the tent sprung structure. This is even moreso with the amount of vertical integration and part production Tesla has pulled in-house....

Thanks scaesare!

 

[wipster]

Hmmm. Could they realistically use the GF to build cars?

They don't just build gigas in there!

Plus with all that available land, I'm sure it can be easily Sprung...