2017 Investor Roundtable:General Discussion

[vgrinshpun]

I am really curious about the Model 3 objective interior volume stats, as from my observation during the June 03 factory VIP tour the interior volume of M3 looked to be very similar to MS (both cars were lined up in the roped area during the viewing). So today I decided to snoop around the Fueleconomy.gov site to see if I can catch a glimpse of advance data on M3.

To my surprise M3 is listed in the 2017 Fuel economy guide not as a compact car, but as a midsize car. It is probably an educated guess on part of EPA, but I can't discount the possibility of them actually having some preliminary data from Tesla. This, if confirmed after all M3 specs are available, is pretty significant as it would mean that Model 3 beats all competitors (BMW 3-Series et al.) on interior space.

The EPA classifies cars with interior passenger and cargo volume of 100-109 cu. ft. as compact, cars with 110-119 cu.ft. as midsize.

Assuming an accurate educated guess or possession of advance info by the EPA, this would mean that interior passenger volume of M3 is between 110-15=95 and 119-15=104 cu.ft.

For comparison, the interior passenger/cargo volume of BMW 3-Series (330i) is 96/13, Audi A4 - 92/13, MB C300 - 90/13.

The bottom line is that M3 not only competes very well on cost, performance, driving dynamics, and technology, but has larger interior volume as well. Let's not forget that all of this is ultimately a manifestation of the lead Tesla has in electric drivetrain and battery technology.

Here is my simple test for a state of such technology vis a vis Tesla: just try to find any other 200+ miles EV that has the same weight as a comparable ICE car.

 

[MitchJi]

Half the US population cannot afford a $35,000 car. Almost 70% of US citizens have less than $1,000 in savings.
Nearly 7 in 10 Americans Have Less Than $1,000 in Savings, New Study Shows -- The Motley Fool

Household income has not kept up with cost of living
NerdWallet's 2016 Household Debt Study

Though that page also cites an average auto debt of 29,000 but that is also per household, not per person.

Many people are not aware of how badly people age 40 and under have been affected by stagnant wages and rising cost of living in the USA. It's a deep subject and I've found many older people (60+) in the states don't understand it and aren't willing to look at the data.

How is that even relevant on this thread? Currently due to battery costs EV's (which are superior to ICE's) cost more to produce and purchase. Part of Tesla's mission is to drive down that cost as rapidly as possible. I believe that they are doing a great job.

Why are you complaining about Tesla? Why not complain about the prices of the Bolt, Leaf, or the BMW i3? Those companies all have deeper pockets than Tesla! The world isn't always fair and that isn't Tesla's fault! They're doing their best.

I'm not unsympathetic or unaware of the issues that you raised. But I don't see how they are relevant to Tesla's pricing of their M3 options. I believe that your points belong in a pro Bernie Sauders post or thread.

 

[GoTslaGo]

So out of curiousity, I built a BMW 320i with silver paint and other features that would (I think) make it somewhat comparable to the base Model 3 (I have included the 0-60 spec, and mpg):

Notice the split fold down rear seat is an option on the BMW. Had to include Nav system to make it comparable to Model 3's screen, and the Driver Assistance Package on the BMW is NOT Autopilot. Just basic stuff to help you park and back up and stuff. I added the paint because that's what I like. Note on the BMW it is 700 dollars.

So a comparable BMW to the base Model 3 is more expensive. Not including gas charges, oil changes, etc... That being said, BMW basic maintenance is included for 4 years/50k miles. That does NOT include wheel alignment (at least 200 per year depending on dealership).

 

[MXWing]

So out of curiousity, I built a BMW 320i with silver paint and other features that would (I think) make it somewhat comparable to the base Model 3 (I have included the 0-60 spec, and mpg):

View attachment 238719

View attachment 238720

Notice the split fold down rear seat is an option on the BMW. Had to include Nav system to make it comparable to Model 3's screen, and the Driver Assistance Package on the BMW is NOT Autopilot. Just basic stuff to help you park and back up and stuff. I added the paint because that's what I like. Note on the BMW it is 700 dollars.

So a comparable BMW to the base Model 3 is more expensive. Not including gas charges, oil changes, etc... That being said, BMW basic maintenance is included for 4 years/50k miles. That does NOT include wheel alignment (at least 200 per year depending on dealership).

You didn't include the 320i tax credits, zero environmental emissions, various state incentives and HOV lane access in your calculations...

 

[sundaymorning]

Fantastic info from above! If a company has 400k pre orders for a widget, and has 10 years experience making said widget, there is very little risk here. They are selling cars and energy, not your personal info to get a few advertising cents so you buy whatever (and even that ratio: sale to advertisement is much smaller than unity).

Some people choose to magnify the risk, however, the certainty outweighs the risk by a factor of 50/1 IMO.

Some of the worlds biggest and most state of the art companies are losing the race to Elon by a very large margin. We are not just talking companies but government agencies are also losing to Elon, take SpaceX as an example. Boeing, Lockheed, China, Russia.. all have far greater cash and more rocket scientist than SpaceX, yet, who builds the cheapest rocket? I don't care about arbitrary apacolytic scenarios, I'll observe Elon from what he achieves with SpaceX and apply it to my success/failure ratio with Tesla.

One thing that separates Tesla/SpaceX from the herd of competition are its employees. You can test this theory for yourself by visiting any Tesla/SpaceX store/factory and do a quick survey with its employees on "morale". From talking with them, both at SpaceX and Tesla, I've come to realize that it's employees are quite special from their response: "I've never worked at a company where things get done so easily, you just ask, and people get it done," said a Tesla employee.

If you are a working professional, I won't have to expand on how challenging it is to "get things done" at work, especially when you ask someone to do something... Yet, Tesla/space X gets it done over and over again, the amount of accomplishments and inventions are mind boggling. It's the chip (pun intended) that Tesla employees carry on its chest (the us against the world mentality) that makes people believe in them, yet, this culture isn't something you can easily replicate.

The culture at Tesla/SpaceX is like none I've ever seen, especially with a large crowd of 25,000 employees. Finding positive vibes with a few hundred employees is easy, but not at 25,000... how many employees did we see cheered the Volt or Bolt or Leaf? The enthusiasm at Tesla/SpaceX is contagious, and it shows on Elon's twitter account, which grows exponentially. Read his account, and see for yourself how much he has inspired the average Joe of our generation and ask yourself this: does this sound like a company headed for disaster?

Hundreds of thousands of "average Joes" lined up to deposit for M3, never and I mean never, in the history of automobiles... this speaks volumes in terms of success/failure ratio. Should one choose to harp on "success isn't imminent," you're preaching to the wrong choir. At Tesla/SpaceX, failure happens while success is imminent, here, "failure is the father of success."

 

[Reciprocity]

The whole 'OMG, nobody will buy a Tesla (or other EV) when the tax credits run out' is nothing more than white noise and/or fear mongering. This is what people do, they wring their hands, jump up and down, predict doom and gloom about things they have not yet experienced/don't know about/etc... It's like reading threads here on the forum like, 'OMG, no instrument panel on the Model 3 - End of the World I tell ya, End of the World!'. It's fear of the unknown. It's fear of change. It's fear of not having control. Drama. White noise. Total eye rolling worthiness. It'll be fine when those credits run out just like it was fine when Tesla decided they'd build a Gigafactory, and when Tesla decided to merge with Solar City etc...

They probably wouldn't if the car was crappy. But exceptional cars will sell and model 3 is priced well without incentives. Model S/X have room to adjust pricing is necessary. Many levers they can pull to make up the difference. States still have many incentives. Lastly this only impacts the US, the rest of the world doesn't have many incentives. Most of the competition is also nearing the end of credits.

 

[vgrinshpun]

So out of curiousity, I built a BMW 320i with silver paint and other features that would (I think) make it somewhat comparable to the base Model 3 (I have included the 0-60 spec, and mpg):

View attachment 238719

View attachment 238720

Notice the split fold down rear seat is an option on the BMW. Had to include Nav system to make it comparable to Model 3's screen, and the Driver Assistance Package on the BMW is NOT Autopilot. Just basic stuff to help you park and back up and stuff. I added the paint because that's what I like. Note on the BMW it is 700 dollars.

So a comparable BMW to the base Model 3 is more expensive. Not including gas charges, oil changes, etc... That being said, BMW basic maintenance is included for 4 years/50k miles. That does NOT include wheel alignment (at least 200 per year depending on dealership).

The 320i is underpowered to be even considered against base M3. In order to get the same acceleration, you'll need to do this exercise with 330i which has the same 0 to 60 acceleration as base M3. Once you see the result, you'll understand why in my recent posts I am stating that M3 (convincingly) **beats** BMW on price **without** considering **any** tax incentives.

All the talk by bears about expiration of federal tax credit is red herring. Totally irrelevant.

 

[Drumheller]

How is that even relevant on this thread? Currently due to battery costs EV's (which are superior to ICE's) cost more to produce and purchase. Part of Tesla's mission is to drive down that cost as rapidly as possible. I believe that they are doing a great job.

Why are you complaining about Tesla? Why not complain about the prices of the Bolt, Leaf, or the BMW i3? Those companies all have deeper pockets than Tesla! The world isn't always fair and that isn't Tesla's fault! They're doing their best.

I'm not unsympathetic or unaware of the issues that you raised. But I don't believe that they are relevant to Tesla's pricing of their M3 options. I believe that your points belong in a pro Bernie Sauders post or thread.

Did you read the post I was replying to? It was relevant to that.

Where in that post did I complain about Tesla?

 

[sundaymorning]

The whole 'OMG, nobody will buy a Tesla (or other EV) when the tax credits run out' is nothing more than white noise and/or fear mongering.

Fact: GM has stopped production of the Bolt, even when government incentives are in place.

Fact: Tesla has over 500,000 reservations to satisfy, verified by Elon.

Enough said.

 

[RobStark]

But I don't see how they are relevant to Tesla's pricing of their M3 options. I believe that your points belong in a pro Bernie Sauders post or thread.

Hey don't give them any ideas about nationalizing Tesla and putting Bernie in the White House on the promise of a Model 3 in every driveway/garage.

 

[sundaymorning]

The 320i is underpowered to be even considered against base M3. In order to get the same acceleration, you'll need to do this exercise with 330i which has the same 0 to 60 acceleration as base M3. Once you see the result, you'll understand why in my recent posts I am stating that M3 (convincingly) **beats** BMW on price **without** considering **any** tax incentives.

All the talk by bears about expiration of federal tax credit is red herring. Totally irrelevant.

Bears, shorts, paid bashers are all out in large numbers since 7pm Friday. I wonder why? While Elon and team put in work, these geniuses are all trying to change the world by blogging away, trying to instill fear in a crowd of investors who crowd source thousands of facts to verify against fake news...good luck with that, bears.

 

[MitchJi]

How much federal credit do you anticipate for each of your reservations?

They have pushed it past the rebate window. Which eliminates it for many.
View attachment 238631

USA Today stated that Tesla currently has 79k remaining. So depending on how fast they ramp M3 production and the percentage of overseas deliveries they will probably hit the 200k limit in either Q1 or Q2 2018. That means that getting the full credit for our dual motor M3's in November or December of 2018 looks posible but dicey and getting the half credit looks like a slam dunk.

What are your predictions/expectations for the SP
Pre ER, the Friday after ER and the last trading day of August.

Honestly, I have NO clue. I have tried to prepare for some downward movement but I will certainly have a better 'paper balance' with an SP of $380 vs $300

I believe that by the end of August that the SP will probably be about $370-390 based on the number of great reviews and the,belief that the market will figure it out faster than with the MS.


That's assuming that there are no major problems with the production ramp which (can't believe I'm saying this) seems like a fairly safe assumption now.

Edit Addition:
If the market believes that the M3 ramp is going to be smooth based on impressions from the reveal event we'll see a substantial sp bump on Monday.

If you believe the dates in the mytesla tool you are expressing confidence in Tesla's production schedule.

 

[dw4ngg]

So out of curiousity, I built a BMW 320i with silver paint and other features that would (I think) make it somewhat comparable to the base Model 3 (I have included the 0-60 spec, and mpg):

View attachment 238719

View attachment 238720

Notice the split fold down rear seat is an option on the BMW. Had to include Nav system to make it comparable to Model 3's screen, and the Driver Assistance Package on the BMW is NOT Autopilot. Just basic stuff to help you park and back up and stuff. I added the paint because that's what I like. Note on the BMW it is 700 dollars.

So a comparable BMW to the base Model 3 is more expensive. Not including gas charges, oil changes, etc... That being said, BMW basic maintenance is included for 4 years/50k miles. That does NOT include wheel alignment (at least 200 per year depending on dealership).

Not to mention the M3 looks way better

 

[RobStark]

 

[GoTslaGo]

The 320i is underpowered to be even considered against base M3. In order to get the same acceleration, you'll need to do this exercise with 330i which has the same 0 to 60 acceleration as base M3. Once you see the result, you'll understand why in my recent posts I am stating that M3 (convincingly) **beats** BMW on price **without** considering **any** tax incentives.

All the talk by bears about expiration of federal tax credit is red herring. Totally irrelevant.

That's why I pulled that comparison. Everyone talks about the base vs. the base. Once you see the numbers, you see how much more of a base you're getting with the Model 3 versus a base BMW 3. I totally agree, one has to go up model to get a truly comparable 3. Just want to get this out there for the future FUD that will be coming down the line.

That being said, they are still offering manual transmissions for many of the BMW models.... will have to look at them in the future to make sure my kids learn how to drive a stick shift...

 

[sundaymorning]

Elon the comedian brings "production hell" jokes. Even yahoo understands Elon was being humorous, which some investors may interpret a bit differently. Compare this to the unspirited MX delay and we can assume things are under control in regards to M3. Trims on the 30 M3 handed over to customers appear to be flushed and well fitted. Usually when Elon brings the jokes, it's a signal for us to bring the champaign bottles.

Tesla CEO Elon Musk Full of Jokes During Model 3 'Handover Party'

 

[vgrinshpun]

That's why I pulled that comparison. Everyone talks about the base vs. the base. Once you see the numbers, you see how much more of a base you're getting with the Model 3 versus a base BMW 3. I totally agree, one has to go up model to get a truly comparable 3. Just want to get this out there for the future FUD that will be coming down the line.

That being said, they are still offering manual transmissions for many of the BMW models.... will have to look at them in the future to make sure my kids learn how to drive a stick shift...

Ha, depending on age of your children, you might need to explain what manual transmission is. If they are young enough they will probably misinterpret manual as referring to manual piloting vs. auto piloting...

As for features and performance metrics, ultimately every one of them can be assigned certain value. That is why I think the preference is to match the variants of competing models as closely as possible, and then compare the bottom lines in $$. It seems to fly under the radar at the moment, but M3 beats competitors on price hands down, **without** any incentives. It is total slam dunk with incentives, even considering only state ones, as federal tax credit is going to diminish in 2018.

This significant price advantage is, in addition to driving dynamics/performance superiority is another 300lbs gorilla in the room. Might take some time to settle in, but future of the ICE competitors in this segment looks bleak (an understatement).

 

[ruralectric]

Always appreciate the valuation models and discussion shared here.

Regarding TE valuation, I look at it this way: Tesla is not just a competitor For market share in the solar panel and storage market business. Tesla is creating an enormous new demand for these products. Tesla really ought to change their name to "Watt".

Pick some numbers. If Tesla hits 500,000/yr Model 3 production, and assume an average battery size of 60kWh, and let's say say each car gets a full recharge once a week (complete wild-assed-guess), that's 1 1/2 Tera watt hours of new energy demand PER YEAR for one years worth of cars. Don't like my numbers, then use your own. And I didn't even count the energy demand from Model S/X, let alone all the new EV competition spurred on by Tesla's success.

Tesla Energy Valuation? I don't know, I'm not any good with this stuff. But I'm thrilled with the Model 3 specs and how well it's being received and I'm optimistic. Buy and hold baby.

 

[anticitizen13.7]

OK. Thank you for putting numbers around your narrative.

Why do you assume:

• Zero revenue for Tesla Semi five years after unveil?
• Only $5B for Tesla Energy five years from today when management guided for a "super-exponential" growth rate multiple times that of Tesla Automotive? For reference, Tesla Automotive will have achieved 75% CAGR from 2013 to 2018. Your CAGR assumption for Tesla Energy from annualized 1Q17 (i.e. $1B in 2017) to $5B in 2022 is 50%, or significantly less than that of Tesla Automotive. Another reference point: 100,000 Solar Roofs alone would bring in more revenue than your estimate, and Gigafactory 2, with its 1+ GWh planned annual capacity will likely be producing more than 100,000 units by 2020. So you're basically assuming zero revenue from Powerpacks, zero from Powerwalls, and zero from solar panels, and no growth for Solar Roofs from 2020.
• Zero revenue from pickup and other products?
• Zero revenue from Tesla Network?

Before I factor in Tesla's semi truck, I want to know more about it with regards to range and features. I also want to hear feedback from the trucking community about what they like or don't like about the prototypes and suggested use patterns.

Before I invested in Tesla several years ago, I had a good idea of how the Model S would work as a family car. The alpha prototypes alone convinced me that Model S was great value because it could transport people and a lot of stuff, provide road tripping capabilities, and be fun at the same time. Having the abilities of a compact crossover and sports car in the same package is enormously appealing. It works well for the customer.

Tesla can prove that to me with the semi when they demo their alpha prototype. They need to show me that it's better than what's on the market today. I don't take things completely on faith.

The same goes for the pickup.

Energy products have potential, but I'm not convinced of a mass ramp of deployments yet. If the various pilot projects go well and result in a flood of new orders I would revise my guesses.

But most importantly, what do you think Tesla will do with Gigafactories 3, 4, 5, and 6, first phases of which will likely start coming online by 2020 and majority of which will likely be finished by 2022, since Tesla can probably achieve your 2m units in 2022 estimate with one more Gigafactory.

Site announcements and some general guidelines on factory construction planning are what I need here.

Basically, there is a certain threshold of information and action that I need to see before adding a product line to my fuzzy model.

 

[Yuri_G]

Bears, shorts, paid bashers are all out in large numbers since 7pm Friday. I wonder why? While Elon and team put in work, these geniuses are all trying to change the world by blogging away, trying to instill fear in a crowd of investors who crowd source thousands of facts to verify against fake news...good luck with that, bears.

Probably slowly realizing they are about to gift all longs with Model 3s in the next year or so. I'll take mine in midnight silver, thx.