2017 Investor Roundtable:General Discussion

[howardoark]

This has been fun. I'm sure no minds have been changed but with that one exception, everyone has been an adult.

"Casting my own investment thesis in your terms, my future projection of Tesla strictly as a car company is one with something like 25% market share."

Toyota has 11% of the worldwide market and sells pickup trucks (trucks accounted for 60% of US new vehicle sales last year - https://www.trucks.com/2017/01/04/trucks-record-2016-auto-sales/ ). If Tesla crushes Toyota and gets 20% of car sales, that would be around 8% of the total market.

"IRVINE, Calif., Feb. 1, 2017 /PRNewswire/ -- The analysts at Kelley Blue Book www.kbb.com, the vehicle valuation and information source trusted and relied upon by both consumers and the automotive industry, today reported the estimated average transaction price (ATP) for light vehicles in the United States was $34,968 in January 2017."

There's a big difference between mean and average - how many $140,000 SUVs equal a Toyota Camry (average sale price $21k). I'll stick with the average person in the US can't afford a $35k car. But thank you for at least putting out numbers.

"Tesla does not need 51% market share to be wildly successful.

In 2019 3% in US-Canada, 1.5% in Western Europe, and .5% in China-South Korea

In 2025 10% in US-Canada, 4% in Western Europe, and 2% in China-South Korea"

I absolutely agree with this. But i) even if there was that much demand, there's no evidence Tesla could meet it and ii) there's no evidence there is anything like that demand, and iii) if that demand develops, the way capitalism works, very many players will be rushing to fill it. What makes Tesla so special that it's immune to capitalism (especially once the socialist, pick winners, tax break goes away).

"Check out the market share of Tesla in the premium sedan segment and report back here. Then we'll talk more."

I don't think the Model S/X sales matter that much to Tesla. The TM3 needs to be a home run or TSLA is toast. The TM3 could very well be a home run. It's a betting proposition (a company with a history of manufacturing problems is increasing production by a factor of five, what will the outcome be?). I've taken the other side of that proposition.

"You're missing how Tesla plan to improve production efficiency. Try google "machines that build the machines" or "alien dreadnaught" in relation to Tesla, you'll see what is in stores for the M3, and even better potentially down the line for the MY."

ummmm... when did Tesla get a patent on that? I'm too lazy to look it up, but the human hours that go into car production has collapsed over the past few decades. GM lost a lot of liabilities and all of it's obsolete car production facilities in the government bailout. Tesla is at the wrong end of a very long logistics chain from the midwest and south (where all the autoparts suppliers are located). They're not going to be more efficient than GM or Ford let alone the Koreans and Japanese.

"(2) Valuation. If Tesla can net margin 10% on 55B revenue, and be valued at 20x earnings in the future, that implies 110B market cap, or about $650/share. Assuming no dilution. S&P500 p/e is something like 25:1 currently."

Let's give TSLA Toyota's numbers instead (6.6% profit margin and PE of 10). On $55 billion in revenue that gives them a share price of $220. And that was very kindly assuming no dilution. If you give them Ford's numbers (2.43% and 12 PE) and assume 30% dilution you get a share price of $68 - and that's if they're selling a million TM3s which is very much not a sure thing.

"If this doesn't convince you, nothing will. Good luck."

This would be great for Tesla except everyone in the car business knows it.

"$10B in GF production adds more value than it dilutes. The only way for 'the rest of the car industry' to catch up is to make the same capital investment (against the cut throat thin margins you reference as a problem). That makes it even more a problem for them, as it actually dilutes their current business and investor base (stock holders). They have a tougher path forward than TSLA in that regard."

That's the problem with the car industry. $10B in GF production produces maybe $800MM in profits which then have to be plowed back into new assembly lines. So, there's no money left over for dividends or share buy backs.

"Add to your short position, please!"

See, this guy has the right idea. Tesla will succeed or fail based on performance, not his or my opinion on what a reasonable share price is. So the more people who short, the lower the (short term) share price will be (and having a long term positive impact on share price) allowing him to take the other side of the bet for less money. My shorting has allowed him to pick up shares for less than they might have cost him. You're welcome.

 

[ggr]

article about Model 3 from the Murdoch press

Aussie customers in the dark about Tesla Model 3 delivery

So? Hundreds of thousands of deposits in the rest of the world who also had (actually, still have) no idea when they'll take delivery.

 

[MikeC]

I'm up $11k so far - though that's just because there were so many people short when I first tried to short TSLA (at $225) that Schwab wanted a minimum $50,000 position and was going to charge me 3% interest on top of that. I tried again at $300, same story. They let me short 50 shares at $382 and I've shorted six more times since then (all 50 shares at a time). Schwab let me short a measly 50 shares without paying 3% interest on the borrow (I forgo the 0.3% interest they pay me on my cash for the $110k I'm short) because six million shares had been covered between January 1st and today. So, yeah, I've been horribly wrong about TSLA in the past and I'm currently right and could easily be wrong again in the near future. Everyone long was right for a long time, is currently wrong and could easily be right agin in the future.

The big trouble with being short is that every day you're wrong, your problem gets worse. Whereas when you're long and wrong, every day your problem gets smaller. I am keenly aware of that dichotomy. Short sellers help longs in the short term (because we allow you to buy shares at a lower price) and whether we're right or wrong, we help you in the long term (covering drives up the price and if Elon Musk gets caught in bed with a dead girl [Edwin Edwards reference, assuming him getting caught in bed with a live boy wouldn't hurt TSLA] shorts will be the only people buying which will support the share price and help you get out).

PS: thank you

You're the most transparent and courteous short I've ever seen on this board, so I'll try to save you some money. If there's even a reasonable possibility the bulls are right, why risk the pain of potential limitless loss? At least buy puts where your risk is defined.

Sure the share price is ahead of itself, but what else would you expect when you have a great new company with great products, as you acknowledge? The share price has been ahead of itself for four years now and it will stay ahead of itself for plenty more.

 

[RobStark]

I absolutely agree with this. But i) even if there was that much demand, there's no evidence Tesla could meet it and ii) there's no evidence there is anything like that demand, and iii) if that demand develops, the way capitalism works, very many players will be rushing to fill it. What makes Tesla so special that it's immune to capitalism (especially once the socialist, pick winners, tax break goes away).

i and ii There can be no evidence of the future. When Henry Ford began building the River Rouge Plant there was no evidence there would be that much demand for the Model T nor that Ford could fill it.

iii Have you learned nothing in this thread. It takes time to build BEV manufacturing capacity. Tesla is building it. No one else is building it. By the time legacy automakers go full bore to transition the demand for the ICEv will collapse leaving them no profits to invest in BEV production nor prospects to get loans. Unless they get socialist loans.

"Socialist pick the winners" programs picks zero emission vehicles. It does not pick BEVs nor specific Companies.

In China Tesla has 85% market share for foreign brand BEVs despite no incentives and a 25% import tax. In 2016 that equaled ~10.5k vehicles and over $1B in revenue.

In Switzerland, Tesla outsells Mercedes S Class,BMW 7 Series, and Audi A8 without incentives.

When incentives end it pulls demand forward 1-2 years. Pointing to Denmark or Hong Kong is a red herring.

 

[techmaven]

How does Tesla, without a moat in a mature cut-throat industry with very many deep-pocketed competitors equal Apple? I will even grant you that Elon Musk = Steve Jobs (maybe even >=). But the lithium ion battery patents expired ~2000 and there are 50 car companies capable of building electric battery cars most of them with vastly deeper pockets (or government support that is basically infinite) than Tesla (which builds great products that look cool, wish I had $120,000 I could blow on a depreciating asset). So Musk could be a combination Jobs/Tesla and he couldn't turn his company into Apple (I'm long Apple, so hopefully Cook won't turn Apple into Tesla).

And now for a completely different style of answer than the long winded EV moat answer I gave earlier.

It may be difficult for some people to remember when Apple wasn't a juggernaut. Or when Steve Jobs was known for leaving Apple and trying to get NeXT off the ground. When Apple bought NeXT in 1997 and eventually brought Steve Jobs back as CEO, Apple was still a beleaguered player on the verge of bankruptcy. What happened in the next 15 years would be unfathomable for someone familiar with the computer scene in 1997. And there are lessons along the way...

Apple's iPod in 2001 was not the first portable digital music player. And it really didn't make much of a splash in the first year as it was tied only to Macs and required the use of Firewire. But by the mid-2000's the iPod was a force of the industry and drove massive Apple profits. One very illustrative dynamic at the time of the iPod heyday is the fact that Apple locked up the NAND flash production capacity. Even if a competitor could launch a decent or better competitor, they couldn't source enough NAND flash chips to make any significant volume dent. It takes time to build NAND flash chip manufacturing plants. Well, this translates over to advanced LIBs too... look at the expected battery plant expansions, especially those that have either broken ground or at least have found actual funding and see Tesla's position in the market.

In 2007, when Apple launched the iPhone, they face mature, deep pocketed competitors in a cut throat environment. Apple was laughed at by many. Here's what one of Blackberry's co-CEOs said at the time:

"It's kind of one more entrant into an already very busy space with lots of choice for consumers," Jim Balsillie said of Apple. "But in terms of a sort of a sea-change for BlackBerry, I would think that's overstating it."

RIM co-CEO doesn't see threat from Apple's iPhone

Steve Ballmer famously said, "No chance of any significant market share"

This is Nokia's chief executive Olli-Pekka Kallasvuo: "I don't think that what we have seen so far (from Apple) is something that would any way necessitate us changing our thinking when it comes to openness, our software and business approach."

So... what went right for Apple and what went wrong for Microsoft, Nokia, Blackberry, and so forth? Look at the moat in 2008 and 2009. You can argue that any of Apple's competitors could have made the iPhone. They had the technical skill. They had access to the same ARM processor designs, NAND flash chips, cell radios, and so forth. They had teams of people writing their own operating systems and operating their own app stores. In so many ways, the moat that Apple had over their competitors was far less than what Tesla has over its competitors. And yet, it took Apple to make the iPod, the iPhone, and the iPad. Again, other people could and did make devices in these categories. But after Apple make these devices, other manufacturers changed their devices to more closely match (or straight out copy) Apple's versions. And yet, in the automotive world, too little of actual copying of Tesla has happened so far. The development cycles are much, much longer in the automotive space.

Apple does what Apple does because of Steve Jobs and his insistence of the intersection of graphic design, user functionality, ease of use, and joy to own in consumer technology. Very few others had that magic sauce, even if they had arguably superior monetary and engineering resources. For Tesla a lot of it comes down to this: Tesla's mission is accelerating the world's transition to sustainable energy. That means they have to make battery electric vehicles work. They will do anything and everything within their power to do so. The other automakers are not currently reliant on their battery electric vehicles to survive. And therefore, they don't act like it does. But it does sooner than they think. Some of their rhetoric is starting to come around, but until we things like suspending dividends and incurring significant financial losses in order to rapidly transform themselves, they will be in trouble. If Tesla didn't exist, then there would not be this rapid forcing function. They could transition in a much longer timeframe that would be far less disruptive. But Tesla does exist.

One of the videos to watch is this presentation by Marc Tarpenning, a founder of Tesla:

 

[Ameliorate]

And now for a completely different style of answer than the long winded EV moat answer I gave earlier.

It may be difficult for some people to remember when Apple wasn't a juggernaut. Or when Steve Jobs was known for leaving Apple and trying to get NeXT off the ground. When Apple bought NeXT in 1997 and eventually brought Steve Jobs back as CEO, Apple was still a beleaguered player on the verge of bankruptcy. What happened in the next 15 years would be unfathomable for someone familiar with the computer scene in 1997. And there are lessons along the way...

Apple's iPod in 2001 was not the first portable digital music player. And it really didn't make much of a splash in the first year as it was tied only to Macs and required the use of Firewire. But by the mid-2000's the iPod was a force of the industry and drove massive Apple profits. One very illustrative dynamic at the time of the iPod heyday is the fact that Apple locked up the NAND flash production capacity. Even if a competitor could launch a decent or better competitor, they couldn't source enough NAND flash chips to make any significant volume dent. It takes time to build NAND flash chip manufacturing plants. Well, this translates over to advanced LIBs too... look at the expected battery plant expansions, especially those that have either broken ground or at least have found actual funding and see Tesla's position in the market.

In 2007, when Apple launched the iPhone, they face mature, deep pocketed competitors in a cut throat environment. Apple was laughed at by many. Here's what one of Blackberry's co-CEOs said at the time:


RIM co-CEO doesn't see threat from Apple's iPhone

Steve Ballmer famously said, "No chance of any significant market share"

This is Nokia's chief executive Olli-Pekka Kallasvuo: "I don't think that what we have seen so far (from Apple) is something that would any way necessitate us changing our thinking when it comes to openness, our software and business approach."

So... what went right for Apple and what went wrong for Microsoft, Nokia, Blackberry, and so forth? Look at the moat in 2008 and 2009. You can argue that any of Apple's competitors could have made the iPhone. They had the technical skill. They had access to the same ARM processor designs, NAND flash chips, cell radios, and so forth. They had teams of people writing their own operating systems and operating their own app stores. In so many ways, the moat that Apple had over their competitors was far less than what Tesla has over its competitors. And yet, it took Apple to make the iPod, the iPhone, and the iPad. Again, other people could and did make devices in these categories. But after Apple make these devices, other manufacturers changed their devices to more closely match (or straight out copy) Apple's versions. And yet, in the automotive world, too little of actual copying of Tesla has happened so far. The development cycles are much, much longer in the automotive space.

Apple does what Apple does because of Steve Jobs and his insistence of the intersection of graphic design, user functionality, ease of use, and joy to own in consumer technology. Very few others had that magic sauce, even if they had arguably superior monetary and engineering resources. For Tesla a lot of it comes down to this: Tesla's mission is accelerating the world's transition to sustainable energy. That means they have to make battery electric vehicles work. They will do anything and everything within their power to do so. The other automakers are not currently reliant on their battery electric vehicles to survive. And therefore, they don't act like it does. But it does sooner than they think. Some of their rhetoric is starting to come around, but until we things like suspending dividends and incurring significant financial losses in order to rapidly transform themselves, they will be in trouble. If Tesla didn't exist, then there would not be this rapid forcing function. They could transition in a much longer timeframe that would be far less disruptive. But Tesla does exist.

One of the videos to watch is this presentation by Marc Tarpenning, a founder of Tesla:

Yeap... Have you seen how slowly ICE's innovate? Vehicles haven't changed a whole lot in 100 years. So they're going to piggyback of Elon's idea's and try to implement them after Tesla already has new tech in vehicles? Always playing catch up doesn't sound like a winning proposition.

 

[howardoark]

"There are obviously some very smart people on the other side of the bet -- folks at Baillie Gifford, Fidelity, Ron Baron, Gene Munster and many others. On the off chance that they are right and the SP doubles, triples, quadruples -- or increases 10X or 20X -- what is your contingency plan?

Do you cut your losses at 50 or 100% or keep answering margin calls all the way up and risk losing 2-10X your original investment or more?"

If it gets back to the 50 day moving average (currently $340) I'll cover, take my $3500 and go home. I wouldn't be willing to go long. I got shaken out of SNAP with a $1200 profit and left $6000 (as of today) on the table. No one ever went broke taking a profit.

"What differentiates a Tesla from any other EV is their network of superchargers. Tesla is creating an ecosystem for their cars. No other traditional automobile manufacturer is doing this, VW might...kicking and screaming*, which should ensure a "quality" (sarcasm intended) product in the future."

That's not correct. There's a consortium of car companies (lead by VW, includes MB and Ford) are building a supercharger network in Europe. You can expect it in the US if electric cars take hold.

"Why is this important? Most people have one car for that 20-100 mile daily commute and for that 300-1000 mile yearly vacation. The superchargers have made it a no-brainer to travel far and wide using a Tesla, and this makes a Tesla a complete ICE replacement."

Well, maybe if you could be sure that there would be a supercharger station free and waiting while you had lunch. The first time you pull into a charging station in your $140,000 Model X and find 12 TM3's waiting to use the supercharger and end up spending the afternoon there waiting for your turn to spend 45 minutes filling up, you'll be back in a Lexus.

"But I will say your primary error is here: "Americans will suddenly wake up to the vast superiority of electrical cars..." You seem to think this will not happen, it already has. I have dozens of right wing friends from central states, only one doesn't want a Tesla, all my left wing friends want Tesla's, my right wing parents plan to buy one. RIGHT NOW 90% of Americans who are aware of the capabilities of a Tesla want one, the transition has already occurred with opinion leaders, its a done deal."

There's another post on this board recently saying that GM has had to shut down the Bolt assembly line due to lack of demand. Other than the cool factor, why do you think the TM3 will be more attractive than a Bolt? This guy has been in both and he doesn't think so: Tesla Model 3 Vs. Chevy Bolt EV: Test Ride Vs. Test Drive

"There is already mountains of text making the bull case for Tesla on this forum, rather than re-state it I'll just post a link to my most recent not-very-comprehensive case: Google+ video hangouts (TSLA & other investments)

Belief: Tesla will sell ~10m cars in ten years.
Reasons to justify this belief:.....

Justifying the probabilities cited would really take some time, so instead of justifying them I'll just ask: don't you agree?"

Well no, I don't. In 10 years Tesla would be selling as many cars as Toyota is selling today.

Good to know you're keeping an open mind Off Shore

 

[D-egg-O]

"There are obviously some very smart people on the other side of the bet -- folks at Baillie Gifford, Fidelity, Ron Baron, Gene Munster and many others. On the off chance that they are right and the SP doubles, triples, quadruples -- or increases 10X or 20X -- what is your contingency plan?

Do you cut your losses at 50 or 100% or keep answering margin calls all the way up and risk losing 2-10X your original investment or more?"

If it gets back to the 50 day moving average (currently $340) I'll cover, take my $3500 and go home. I wouldn't be willing to go long. I got shaken out of SNAP with a $1200 profit and left $6000 (as of today) on the table. No one ever went broke taking a profit.

"What differentiates a Tesla from any other EV is their network of superchargers. Tesla is creating an ecosystem for their cars. No other traditional automobile manufacturer is doing this, VW might...kicking and screaming*, which should ensure a "quality" (sarcasm intended) product in the future."

That's not correct. There's a consortium of car companies (lead by VW, includes MB and Ford) are building a supercharger network in Europe. You can expect it in the US if electric cars take hold.

"Why is this important? Most people have one car for that 20-100 mile daily commute and for that 300-1000 mile yearly vacation. The superchargers have made it a no-brainer to travel far and wide using a Tesla, and this makes a Tesla a complete ICE replacement."

Well, maybe if you could be sure that there would be a supercharger station free and waiting while you had lunch. The first time you pull into a charging station in your $140,000 Model X and find 12 TM3's waiting to use the supercharger and end up spending the afternoon there waiting for your turn to spend 45 minutes filling up, you'll be back in a Lexus.

"But I will say your primary error is here: "Americans will suddenly wake up to the vast superiority of electrical cars..." You seem to think this will not happen, it already has. I have dozens of right wing friends from central states, only one doesn't want a Tesla, all my left wing friends want Tesla's, my right wing parents plan to buy one. RIGHT NOW 90% of Americans who are aware of the capabilities of a Tesla want one, the transition has already occurred with opinion leaders, its a done deal."

There's another post on this board recently saying that GM has had to shut down the Bolt assembly line due to lack of demand. Other than the cool factor, why do you think the TM3 will be more attractive than a Bolt? This guy has been in both and he doesn't think so: Tesla Model 3 Vs. Chevy Bolt EV: Test Ride Vs. Test Drive

"There is already mountains of text making the bull case for Tesla on this forum, rather than re-state it I'll just post a link to my most recent not-very-comprehensive case: Google+ video hangouts (TSLA & other investments)

Belief: Tesla will sell ~10m cars in ten years.
Reasons to justify this belief:.....

Justifying the probabilities cited would really take some time, so instead of justifying them I'll just ask: don't you agree?"

Well no, I don't. In 10 years Tesla would be selling as many cars as Toyota is selling today.

Good to know you're keeping an open mind Off Shore

Your responses to all of the arguments presented tells me you came to this forum truly unwilling to try to understand the long term investment thesis in Tesla. Either that, or you just don't get it...YET.

I leave you with a final statement. Look up "the innovators dilemma" and research the rate at which disruptive technologies have been adopted in history. (Hint: adoption rates increase)

Good luck.

 

[neroden]

I'm short Tesla. The Model S and the Roadster are amazing cars. Elon Musk is a genius. So, please don't hate me, educate me as to why I should cover.
.....
So, before hitting that dislike button, please tell me why I'm wrong.

(1) Electric cars are fundamentally superior to gasoline cars. Until they have replaced all gasoline cars, there is literally no competition; every electric car displaces a gasoline car, they do not really compete with each other. We know this from the waiting lists to buy them.

(2) Tesla has a definite lead in electric car design, with only BYD and Hyundai looking like they're anywhere close. This includes a lot of technical details which other car companies *could* copy but for some reason choose not to. They have larger margins than anyone else.

(3) Nobody else is ramping up fast enough to take market share comparable to Tesla. Nobody else has a supply chain set up. Tesla is most certainly going to be making much more than a million cars a year before electric cars completely displace gasoline cars.

(4) Tesla has a brand lead which is substantial.

(5) The existing auto industry is devalued by the stock market because of bad management and the death of the ICE engine; it is not sensible to compare a growth industry valuation to a shrinkage industry valuation. (Though also, I bet you excluded the dealerships and the gas stations in totalling the industry value...)

(6) Tesla also has a large stationary storage business, and appears to be both the cost leader and the brand recognition leader and the volume leader, simultaneously. Hello South Australia!

----
Your main error is assuming that it is unlikely that Americans will wake up to the superiority of electric cars. This is in fact guaranteed.
Your second major error: the incumbent major car companies have actually spent literally decades letting Tesla take market share from them, and they will continue to do so, because leopards don't change their spots. (The actual competitive threat to Tesla is new startup car companies, such as BYD.)

 

[neroden]

re: James Murdoch

Interesting recent to shed some light:

Michael Wolff: It's James Murdoch's Fox News Now

http://www.hollywoodreporter.com/news/michael-wolff-james-murdochs-fox-news-995800
That was extremely informative. I didn't know any of that. In that light, he makes a huge amount of sense on the board.

 

[neroden]

I agree with your thoughts. I don't think you should cover.

If TSLA were the only company making EVs and EVs become wildly popular, the current SP might make sense.

EVs are becoming wildly popular and TSLA is the only company outside China making significant numbers of EVs.

But it isn't going to happen that way. The transition away from ICE will be slow and most every automaker will begin offering EVs.

Which is Elon Musk's stated goal. Except they seem awfully resistant to doing so. Awfully, awfully resistant. Every year they delay is more market share to Tesla.

Other car companies have very deep pockets

Some of the Chinese government-backed ones, yes. Most of the others -- have you LOOKED at their balance sheets?

and manufacturing facilities that can be transitioned to EV production.

So can empty buildings. At about the same price.

They can lose money on EVs for a long time if necessary.

Actually, they can't. They'll go bankrupt. Again.

The biggest problem I believe TSLA will have is the lack of facilities. I live in SoCal, but my nearest service center is 60 miles away.

Yes, this is an issue. Arguably the only material issue.

 

[neroden]

](2) Valuation. If Tesla can net margin 10% on 55B revenue, and be valued at 20x earnings in the future, that implies 110B market cap, or about $650/share. Assuming no dilution. S&P500 p/e is something like 25:1 currently.

At 10 P/E -- a very respectable long-term P/E for a normal industry (the traditional car industry is not normal) -- you get $325/share, or the current price.

And 55 Billion is a pretty conservative long-term revenue estimate given the company's current rate of growth.

 

[neroden]

How does Tesla, without a moat in a mature cut-throat industry

Stop right there. None of the other companies know how to make pure electric cars. The Leaf -- yes, but it still doesn't have a proper battery thermal control system or the right range or fast charging. The Leaf 2.0 will finally have the right range, but we'll see if it has the thermal control, and I bet it still doesn't have fast charging.

Everyone else outside China? just look at the barely-trying volumes. At best, they're going through the startup/learning phase. Even most of the Chinese companies are going through the startup phase. There are actually things you have to learn in order to make a good electric car. They're very very slow at learning them. By the time they're ready to compete, Tesla will be making 4 million cars per year.

 

[neroden]

Please, go on. Point to some cogent posts.I'm short; 99% of the people on this forum are long, so I know I come across as a jerk. But really, short term stock prices are determined by the average investor and the average investor is, by definition, not a genius. So no one should take any of this personally.

I'm specially interested in how Tesla will raise sufficient capital to build out the giga factories, the charging networks, the new assembly lines, the PV factories

Profits. Bonds, which are easy when you have profits. Stock issuance, which is easy when you have profits.

I'm really interested in how many Model 3's they'll sell (how many of those 400,000 deposits will turn into ~$40,000 sales

About 1,000,000 of them. The deposit list generally doubles after it actually becomes possible to test drive the car.

 

[neroden]

They're not going to be more efficient than GM or Ford let alone the Koreans and Japanese.

*Sigh* They already are. Worse for the incumbent automakers, Tesla is attracting the best *talent* in automation. It won't be fully deployed for Model 3, but the Model Y factory is about to leapfrog all the designs at the existing automakers. It really does take intensive analysis to find out what's going on and you haven't done it.

- and that's if they're selling a million TM3s which is very much not a sure thing.

If they can manufature a million Model 3s a year, they'll sell them. That's a sure thing. If you haven't figured out why, you haven't even started to do your research.

"If this doesn't convince you, nothing will. Good luck."

This would be great for Tesla except everyone in the car business knows it.

They sure don't. The head of Fiat Chrysler is still claiming ICE will rule forever. Some of the other companies just figured out that EVs will be the future... this year. That puts them over a decade behind Tesla.

 

[WarpedOne]

1. I borrow and sell
2. I ask why I may be wrong

Am I the only one seeing the problem?

 

[sundaymorning]

Please, go on. Point to some cogent posts.I'm short; 99% of the people on this forum are long, so I know I come across as a jerk. But really, short term stock prices are determined by the average investor and the average investor is, by definition, not a genius. So no one should take any of this personally.

I'm specially interested in how Tesla will raise sufficient capital to build out the giga factories, the charging networks, the new assembly lines, the PV factories (maybe pay for some TV ads now that they're going mass market). Tell me how they'll beat Waymo and Intel to a mass market Level 5 autonomous vehicle technology (Musk is not doing any programming). I'm really interested in how many Model 3's they'll sell (how many of those 400,000 deposits will turn into ~$40,000 sales - especially if the resale market doesn't live up to people's expectations - all of you who put down $5k expecting you'll be able to resell them for double the asking price). Really, if you have money in this company (and just because its the casino's money, doesn't mean you couldn't pay your kid's tuition with it at this point) you should have some quantitative explanation for why you're long (e.g., they'll sell six million TM3's over the next 5 years, have $150 million in capx, win Motor Trend's car of the year, et cetera). Please, lay it out for me. Because as far as I can tell, the Tesla longs are just like the SNL Super Fans skit with Tesla as Da Bears and Elon Musk as Coach Ditka (So, yeah, Elon Musk versus a tornado, who wins?)

You're very smart, keep shorting. None of the Teslanaires here know what they're but talking about. Neither does Elon, he's way beneath you and the shorts. He's no genius, PayPal was all smokes and mirrors, it's not worth the $40-50 billion market cap neither, afterall, they're competing against banks that have tons more money and can put them out of business. The SpaceX rocket launches for NASA are a really just fake news, not impressive not worth a nickel of attention from the likes to Aron Baron or Chinese investors. Tesla's best in class safety, safest SUV ever built in the 100 year history of automobile means nothing. The gull wings aren't cool, no one wants it. The S best selling car in America in just under 5 years of existence isn't impressive. None of this of course is revolutionary nor there they equal more future sales. Tesla sales will plummet, so short and short someone. Get your family and friends in the shorting spree make a million bucks over night.

Tesla is just a car company like
Amazon is just a "book" company.
Like Netflix is just a DVD company.
Like Apple just a phone company.

When you're the best at what you do...

 

[Yggdrasill]

If it gets back to the 50 day moving average (currently $340) I'll cover, take my $3500 and go home. I wouldn't be willing to go long. I got shaken out of SNAP with a $1200 profit and left $6000 (as of today) on the table. No one ever went broke taking a profit.

That's the most likely outcome for you, then. Congrats on getting lucky.

I sold a bunch of shares at 370 (some of the profits paid for half my Model X! ), and currently I'm looking for an entry point. I think Tesla could potentially drop to 250 USD, before continuing the growth. More likely only 280-ish, though. And I would be okay with it not dropping below 300 too.

"What differentiates a Tesla from any other EV is their network of superchargers. Tesla is creating an ecosystem for their cars. No other traditional automobile manufacturer is doing this, VW might...kicking and screaming*, which should ensure a "quality" (sarcasm intended) product in the future."

That's not correct. There's a consortium of car companies (lead by VW, includes MB and Ford) are building a supercharger network in Europe. You can expect it in the US if electric cars take hold.

"If" electric cars take hold? This is the core flaw of your position. You *grossly* underestimate the speed at which the world will transition to electric cars. It's not a matter of "if", the writing is on the wall and there are no takesy-backsies. Global EV sales in 2050 will almost certainly be over 50 million/year. Tesla could be massively successful with a 2% market share. And nothing is suggestive of Tesla being happy with 2%. They will continue to scale up as fast as they possibly can. This is a race for market share, and all the competitors seem to be asleep.

The degree to which the supercharger network is an advantage to Tesla can't be exaggerated. Even if the competition decides to try to make an equivalent network, they're starting from *scratch*. No wait, I read a couple of days ago that Porsche has actually installed the first charger at their headquarters, so they're starting with one (1) charger.

Even if their charging network is rolled out as fast as humanly possible, they're years behind the supercharger network. I came home from a 2000 mile road trip the other day, a trip that was almost entirely impossible without the supercharger network. (At least extremely uncomfortable with only CCS/CHAdeMO.) Why do you think the *promise* of a good charging network will be able to compete with an actual fully functional good charging network? And when will the *promise* turn into reality? Maybe ~2022? By then, Tesla will already be making over 1 million BEVs per year.

Well, maybe if you could be sure that there would be a supercharger station free and waiting while you had lunch. The first time you pull into a charging station in your $140,000 Model X and find 12 TM3's waiting to use the supercharger and end up spending the afternoon there waiting for your turn to spend 45 minutes filling up, you'll be back in a Lexus.

Tesla is currently rolling out 40 stall superchargers in those areas where charging demand is high. With current tech, a 40 stall supercharger is able to recharge a 75 kWh Model 3 0-70% approximately every minute. Basically, there will always be a car leaving.

Most places, the current network is sufficient for a lot more cars than currently on the road. On my 2000 mile road trip, it wasn't unusual to be alone at a supercharger. And remember, Model 3 owners will not get unlimited free supercharging. This will limit supercharger abuse. (Supercharging to save money and/or supercharging more than needed.)

 

[RobStark]

No wait, I read a couple of days ago that Porsche has actually installed the first charger at their headquarters, so they're starting with one (1) charger.

Porsche built a fast charging station at their Global Headquarters in Germany and another one at their American Headquarters. Just 907 to go before they catch up.

 

[Yggdrasill]

Porsche built a fast charging station at their Global Headquarters in Germany and another one at their American Headquarters. Just 907 to go before they catch up.

I checked, and it seems like they added two chargers, at least in Europe. So, that's 4 chargers, and only 6054 until they catch up... I expect they will continue to fall behind for a few years, though.