2017 Investor Roundtable:General Discussion

[esk8mw]

In addition, CR seems to have a double standard when it comes to safety, at least as far as Tesla goes. They hammered the Model S because AEB was temporarily disabled over 28 mph, but don't seem to give much credit to the Model X for being the safest SUV the NHTSA has ever tested.

Yep. I think they got a ton of criticism when they gave the Model S a 103 out of 100, accused of playing favorites and being too green focused, etc.

So, now they go way too far in bashing Tesla at every opportunity to appear "fair and balanced." They are obsessed with the idea of being a neutral party and feel this is the best way to avoid criticism.

 

[neroden]

Anyway, Tesla has to reinvent basic railroad engineering, because circumstances have changed.

Inappropriate languageThis is not how Musk approached either of his other two businesses. He didn't reinvent the rocket equation or try to design a new type of electric motor.

I know how to work from first principles, and the idiotic stuff Musk is doing with tunnel boring *isn't* working from first principles. (Unless all the business models he's suggested are actually deliberate fakes and he's really developing it for the space railgun or for Mars, which is a possibility.) He's making goofy, stupid assumptions -- specifically, goofy stupid assumptions about what the expensive part of the process is, and goofy stupid assumptions about what the limiting factors on transport throughput are.

They're not only goofy, stupid assumptions, they're *common* stupid assumptions, and people have to be trained out of them in Urban Planning 101.

A good analogy would be the guy who was trying to sell a way to sterilize sewage (and yes, this really happened). He had a great system for sterilizing sewage! Hopefully you know what's wrong with this idea. A lot of people don't.

Musk is very good at solving problems. However, lately, he seems to have been not nearly so good at IDENTIFYING what the problem actually IS. ("We need to be able to transfer money on the Internet" is a correct problem identification. "We need to stop using fossil fuels" is a correct problem identification, and breaking that down to "we need to replace gasoline cars with battery electric cars" and "we need to replace thermal power plants with solar panels and batteries" is also correct. "We need to drill holes faster" is probably a wrong problem identification.)

 

[ValueAnalyst]

Yep. I think they got a ton of criticism when they gave the Model S a 103 out of 100, accused of playing favorites and being too green focused, etc.

So, now they go way too far in bashing Tesla at every opportunity to appear "fair and balanced." They are obsessed with the idea of being a neutral party and feel this is the best way to avoid criticism.

I agree with your assessment 110%. I know the feeling first hand

 

[larmor]

Yep. I think they got a ton of criticism when they gave the Model S a 103 out of 100, accused of playing favorites and being too green focused, etc.

So, now they go way too far in bashing Tesla at every opportunity to appear "fair and balanced." They are obsessed with the idea of being a neutral party and feel this is the best way to avoid criticism.

Curious that CR reappears so close to the M3 reveal... Many car shoppers go to CR for reliability and may be this recent re-report is to jog everyone's memory of where to click, esp for about 400k people eagerly awating their M3... just sayin'

 

[neroden]

If you want to have a proper discussion about the threat of AI, talk to a philosophy professor, or perhaps a psychology professor. AI is a threat not due to its intelligence, but its lack of empathy and care for social constructs.

We have someone here who does understand this! Yep.

It will be a very powerful child who will have no respect for humanity, and might even see humanity for the "scourge" on the planet that it is!

Idiots savants, as I said in an early comment. Very dangerous to have a bunch of powerful idiots savants.

There have been so many science fiction books written on the topic that field the possibilities much better than most of the postulating done by armchair AI experts.

It's not a tech issue, it's a psychological one. I would think AI would be inherently nihilistic, and that's why it would be a danger.

 

[neroden]

Though Flyvbjerg argued that tunneling is hard, largely because you never know what you're digging into, he noted that part of what makes it so astronomically expensive is that the industry hasn't had much competition. Boring machines are essentially one-off items custom-built for a particular project, and the companies that dig the holes often have local monopolies. If Musk could translate underground the approach he brought to reusable rockets, Flyvberg said, he could drastically reduce the price of a given dig.

So, so far, this is accurate. If Musk can mass-produce TBMs and, *more importantly*, break the local construction monopolies, he could cut costs significantly.

However, so far he isn't doing anything which would break the local construction monopolies. The really really overpriced and delay-prone part is NOT the TBM part of the construction; it's the surface access points. He needs something which will replace THAT in order to break the local construction monopolies.

If he has a fast TBM and the people digging the access point are from the local construction mafia, he's going to make essentially no progress on dealing with the cost issue. This should be obvious, right? I would really like to get Musk to lunch for an hour to point him in the right direction. Automated bulldozers and backhoes would probably do the trick.

The "You never know what you're digging into" remains a problem for the tunnelling portion, and there's no way to get around that. A combo TBM which could handle all three of the common types of ground would be great, but I'm not sure Musk even realizes that there are three different types of TBMs yet.

(P.S. You can't make the TBMs any more reusable than they already are; they are very reusable. The problem is fundamentally that the cutting heads wear out as they grind away at rock, and they *must* be replaced: they are a wear item, like tires, or rocket fuel. )

(P.P.S. If you're going to mass-produce a standardized TBM, making it slightly larger than London Underground tube size -- as Musk has proposed -- is a totally reasonable choice of size, as it works for most subways, but calling this larger diameter "smaller diameter" is simply false. I believe Musk made false statements about this due to gross ignorance... and that's not a good sign.)

 

[RobStark]

Tesla Model X Reviews, Ratings & Pricing - Consumer Reports

CR slams Model X, but isn't at least one of the issues they list (folding second-row seats) and the "first-year reliability" issues already addressed?

1) Tesla offers a conventional folding second row bench in 5 passenger and 7 passenger Model X. 6 passenger Model X has beautiful sculpted non-folding monopost seats.

2) Tesla says first year reliability issues have been resolved in Model X but it has not been confirmed by third party reliability statistics company. Specifically, Consumer Reports only references their own survey, we should find out CR's 2017 Model X initial quality results this fall.

 

[ValueAnalyst]

1) Tesla offers a conventional folding second row bench in 5 passenger and 7 passenger Model X. 6 passenger Model X has beautiful sculpted non-folding monopost seats.

2) Tesla says first year reliability issues have been resolved in Model X but it has not been confirmed by third party reliability statistics company. Specifically, Consumer Reports only references their own survey, we should find out CR's 2017 Model X initial quality results this fall.

Thank you. Model X needs to step up its game in 2H17 and capture market share if Tesla won't get to 5,000 Model 3's per week until year-end.

 

[Sparky]

Walking the walk....

Tesla Lobbies Against Solar Trade Protections

 

[Waiting4M3]

Exactly. For those of us who truly care about environmental impact of the cars we drive - and I concede this is not a necessary position to hold in order to buy or like Teslas, we all have our reasons - it is insane to think of buying any car from any other automaker, even a BEV (setting aside affordability questions of course, not everyone has the option to get a Tesla).

Every single one of these companies, whether or not they have BEVs for sale or in the pipeline, are lobbying for relaxed emission standards. Supporting them with purchases of anything is standing behind that policy position. I have no idea whatsoever why people cheer for cars like the Bolt when GM is working hard to kill Tesla and Tesla's goals of cleaner air.

Traditional automakers will have my support when they actually produce a non-compliance car BEV and stop lobbying for relaxed emissions. I don't subscribe to the "something is better than nothing" philosophy when lobbying money is being spent in opposition to the ultimate goal of cleaner air.

The traditional automaker are in a bit of a chicken and egg situation. They don't want to make high volume of EVs until they can achieve good margin on it, and they can't achieve good margin at this time without high volume. This is usually exacerbated by the legacy pension contracts that many carry.

Given this difficulty, IMO if they make an effort, they should at least be encouraged for it. I give GM credit for at least trying the Bolt, and hope to see them continue to increase the volume and drive down the price to make it more affordable for more people. Not all traditional automakers will or should go down in flames through the EV transition, there is nothing wrong in rewarding the ones that are more open minded to EV. A $ spent on EV is a $ spent on EV. It would help them get over the hump and transition to building profitable EVs, and eventually discontinue making ICEs. Volvo, Diamler are all OK by me, walking the walk towards making a real change. If/when GM does expand their Bolt output and starts selling in non-CARB states, I would put them on the "OK" list also.

 

[Waiting4M3]

They don't give Tesla much credit, and don't penalize the other oem's at all for the fact that Tesla's are unusually safe. If Tesla can do that why can't the other oem's?

I know that Tesla touts the fact that no ice in the front is an advantage but surely the other oem's could do better if they tried?

And zero credit for producing EV's which are safer due to less deaths from emissions.

Definitely not being consistent.

@ValueAnalyst said:

CR is like the dad who holds his favorite kid to higher standards.

More like the dad who holds his favorite oil company to a lower standard.

Someone should make a Car Crash Death Match show, 2 car head-to-head (literally), and see which fairs better.

 

[MitchJi]

Thank you. Model X needs to step up its game in 2H17 and capture market share if Tesla won't get to 5,000 Model 3's per week until year-end.

Are you assuming that the reason that the MS has been outselling the MX is because of demand? Because I believe that the only reason is the MX production problems.

 

[EinSV]

Yep. I think they got a ton of criticism when they gave the Model S a 103 out of 100, accused of playing favorites and being too green focused, etc.

So, now they go way too far in bashing Tesla at every opportunity to appear "fair and balanced." They are obsessed with the idea of being a neutral party and feel this is the best way to avoid criticism.

Their conclusion that Model X is impractical ("more showy than practical") seems to be at odds with the objective data:

• Model X ranked safest SUV by NHTSA
• Model X is EPA rated to get 93 MPGe v. a pathetic 18 MPG average for standard SUVs
• Model X has better handling and acceleration than other SUVs

Model X is not cheap and the initial quality issues are valid concerns that hopefully will fade as updated quality data becomes available, but much of their criticism seems very subjective or out of date (no folding seats, slow FWDs, initial quality data).

On the plus side, until CR's review of the Model 3 is available Model S is the closest analogy so reinstating the top rating for the Model S before the Model 3 delivery event seems like a positive development.

 

[GoTslaGo]

Hadn't seen this mentioned here (but very well could be that I missed it):

Tesla Gigafactory Pumps Out 1,500 Model 3 Batteries, Tesla Model S 75 Discontinued

 

[Waiting4M3]

So, so far, this is accurate. If Musk can mass-produce TBMs and, *more importantly*, break the local construction monopolies, he could cut costs significantly.

However, so far he isn't doing anything which would break the local construction monopolies. The really really overpriced and delay-prone part is NOT the TBM part of the construction; it's the surface access points. He needs something which will replace THAT in order to break the local construction monopolies.

If he has a fast TBM and the people digging the access point are from the local construction mafia, he's going to make essentially no progress on dealing with the cost issue. This should be obvious, right? I would really like to get Musk to lunch for an hour to point him in the right direction. Automated bulldozers and backhoes would probably do the trick.

The "You never know what you're digging into" remains a problem for the tunnelling portion, and there's no way to get around that. A combo TBM which could handle all three of the common types of ground would be great, but I'm not sure Musk even realizes that there are three different types of TBMs yet.

(P.S. You can't make the TBMs any more reusable than they already are; they are very reusable. The problem is fundamentally that the cutting heads wear out as they grind away at rock, and they *must* be replaced: they are a wear item, like tires, or rocket fuel. )

(P.P.S. If you're going to mass-produce a standardized TBM, making it slightly larger than London Underground tube size -- as Musk has proposed -- is a totally reasonable choice of size, as it works for most subways, but calling this larger diameter "smaller diameter" is simply false. I believe Musk made false statements about this due to gross ignorance... and that's not a good sign.)

At this stage of the Boring company, how much does it have to do with Tesla? Elon is not spending Tesla's money in the Boring company, is he? If he wants to dig, why are we going crazy on the Tesla investor forum? Or is there already a model on how the Boring company may change Tesla's valuation?

 

[scaesare]

Musk is very good at solving problems. However, lately, he seems to have been not nearly so good at IDENTIFYING what the problem actually IS. ("We need to be able to transfer money on the Internet" is a correct problem identification. "We need to stop using fossil fuels" is a correct problem identification, and breaking that down to "we need to replace gasoline cars with battery electric cars" and "we need to replace thermal power plants with solar panels and batteries" is also correct. "We need to drill holes faster" is probably a wrong problem identification.)

This is an inaccurate characterization.

The problem is not "lack of ability to make holes in the ground in a timely fashion".

The problem, as Musk has stated many a time, is the inadequate ability for surface roadways in congested areas to deliver you from point A to B in a timely fashion.

The end-goal is not a tunnel, it's being able to go 4.5 miles in LA in less than 90 minutes on the 405. Tunnels and sleds are a means to that end.

 

[ValueAnalyst]

Are you assuming that the reason that the MS has been outselling the MX is because of demand? Because I believe that the only reason is the MX production problems.

I agree with you generally speaking. I also think, whoever, model x continues to suffer from some perception around initial build issues. We'll see how Q3 evolves, but I would have hoped to see Model X eat into BMW/Daimler shares a bit more at this point. If model 3 Osbornes model s, model x will have to carry the torch for Q3 until Model 3 can ramp up in Q4.

Having said this, the future of the company depends mostly on Model 3 anyway, but I'd rather Tesla not give bears another July type opportunity in the next three months until December.

 

[DurandalAI]

Someone should make a Car Crash Death Match show, 2 car head-to-head (literally), and see which fairs better.

Ironically enough, any vehicle that is crashed into a Tesla at 70mph will do better than if crashed into the standard immovable wall at 35mph that is used for crash testing. The reason? Well, the same thing that makes a Tesla safer for its occupants (larger crumple zone) also makes it safer for those that crash into a Tesla!!

 

[Dennisj00]

Inappropriate languageThis is not how Musk approached either of his other two businesses. He didn't reinvent the rocket equation or try to design a new type of electric motor.

I know how to work from first principles, and the idiotic stuff Musk is doing with tunnel boring *isn't* working from first principles. (Unless all the business models he's suggested are actually deliberate fakes and he's really developing it for the space railgun or for Mars, which is a possibility.) He's making goofy, stupid assumptions -- specifically, goofy stupid assumptions about what the expensive part of the process is, and goofy stupid assumptions about what the limiting factors on transport throughput are.

They're not only goofy, stupid assumptions, they're *common* stupid assumptions, and people have to be trained out of them in Urban Planning 101.

A good analogy would be the guy who was trying to sell a way to sterilize sewage (and yes, this really happened). He had a great system for sterilizing sewage! Hopefully you know what's wrong with this idea. A lot of people don't.

Musk is very good at solving problems. However, lately, he seems to have been not nearly so good at IDENTIFYING what the problem actually IS. ("We need to be able to transfer money on the Internet" is a correct problem identification. "We need to stop using fossil fuels" is a correct problem identification, and breaking that down to "we need to replace gasoline cars with battery electric cars" and "we need to replace thermal power plants with solar panels and batteries" is also correct. "We need to drill holes faster" is probably a wrong problem identification.)

I think you've missed the boring problem. Think out of the box. Even here in NC, we can't continue to pave multi-lane parking lots-otherwise known as interstates or toll roads.

 

[kbM3]

Will Tesla's Balance Sheet End Its Dreams? - Tesla Motors (NASDAQ:TSLA) | Seeking Alpha

Thoughts, comments, compliments, critiques, and grudges, welcome.

I don't have a finance background, but I learned a lot from that article. Thanks.