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2017 Investor Roundtable:General Discussion

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Krugerrand

Enough of the 🐩, back to 🐈‍⬛
Jul 13, 2012
11,069
56,638
Tesla friendly place
I don't think people realize yet that the combined ENTERPRISE VALUE of automakers is more than $2 trillion.

This is just one of the several multi-trillion industries Tesla is disrupting simultaneously and at an unprecedented rate.

Tesla's total addressable market is a lot more than estimated and it will get there quicker than estimated.[/QUOTE]

Most everyone here knew this years ago.
 

Curt Renz

Well-Known Member
Mar 5, 2013
6,663
87,185
USA
Indiana is only 50 miles or less from Chicago. Less corruption, less taxes for Tesla employees. Anyone who can is fleeing Illinois.

Chicago is the rail hub for the nation and has direct access to Europe through the Great Lakes. Labor is plentiful. Getting more factories should end that flight.

Yesterday I wrote politicians and Tesla about the popularity of small SUVs among Midwesterners and suggested a Model Y factory in Chicagoland. Here is how a Tesla agent responded:

Hi Curt,
Thank you for being a shareholder and bringing this concept/idea to our team!
I will definitely pass this article along. Really interesting.
Model Y will definitely be a game changer for the smaller electric SUV on the road. So exciting!
We appreciate your passion for our company and support.
Best,
Jenifer Strom
 

DragonWatch

Small FootPrint
Aug 22, 2016
1,035
3,482
Mother Earth (Grapeview, WA)
Oh boy
TSLA upgraded to bi-polar now!
Tesla investors need a 'bipolar outlook' on the stock, analyst says
"<
Jim McCaughan, CEO of Principal Global Investors, said that the majority of the market thinks Tesla will be a big success but it's not so black and white.
"The thing with Tesla is it's either going to be a dominant force in its industry or it's going to somehow get competed away. And if you're looking at it as a stock, you need to have a very … bipolar outlook," McCaughan told CNBC in a TV interview on Tuesday.
[ ]
"The market is obviously going for the big one, the big success. I would argue that from a bondholder point of view it's actually still quite risky because there are pretty big guns with a lot of resources, from Mercedes, BMW, GM, coming into that," McCaughan said.
>"


Or slow disruptive conversion of TSLA holdings into bipolar silver 'n gold perhaps?

Or, "Rock Steady, Always Ready," our 51st Company motto in OCS back 1977. The stock has always been a mega risk or gamble! The mission statement set the company up for success as it proves the good guy/gal can win. Tesla/Elon set out to make EVs sexy, affordable and change the course of the future be it disrupting the auto industry or redirecting global warming/climate change.

Musk has single handedly peed on every manufacturer that polluted, hated workers, and corrupted city, county, state or federal governments throughout the history of the nation. He has proven beyond a shadow of a doubt that a good guy or gal can win!
 

DurandalAI

Member
Dec 20, 2016
962
2,912
US
I think you misread my post. According to the person I spoke with, she paid $9k for a preowned Leaf with 25,000 miles on it. The price didn't drop $4-5k, but rather dropped $26k, or about 75% of its value within 2 years and 25,000 miles. That is indefensible in terms of value proposition. You can go on craigslist and check for the price on these leafs, many are selling at $6-8k, preowned everywhere across the nation.
I paid $6,000 for my 2012 Nissan Leaf SL. Usable range of 55-60 miles, if I drive it on back roads at 45-50mph, and 45-50 miles if I drive it on the freeway. Expected usable lifespan of the Leaf for commuting purposes will be roughly 3-4 years, given the rate of battery degradation. After that, it will really only be good as a grocery vehicle unless my employer has L2 charging available in the next 3 years, but I likely will sell it before that time. I save $1,200/year in gasoline costs, so if I can sell it for $3,000 two years from now, I'll break even.

My wife likes the Leaf plenty, she sure loves it more than her Nissan Versa, but she hates the range anxiety, and she hates having to take back-roads. The Leaf's lack of active thermal management is what kills the batteries, all because Nissan wants to save an extra $500/car and pretend that degradation isn't a problem. It's great up north from what I understand, but not down here where it's warm.
 

RubberToe

Supporting the greater good
Jun 28, 2012
3,020
7,344
El Lay
this is so awesome... shoot this thing through the roof.

Well, you did ask for it. Roof approach coming fast...

roof_zpsi8gftiqm.jpg
 

22522

Active Member
Jun 6, 2016
1,736
3,328
Texas
Tesla Model 3 battery packs have capacities of ~50 kWh and ~75 kWh, says Elon Musk

During the call, Musk also expressed concerns over battery cell supply potentially creating a bottleneck for Model 3 production and even suggested that Tesla could push customers toward the smaller battery pack option, which require significantly fewer cells.

Looks like TMC members' original estimates were correct.

This is good because it puts factories in competition.

Maybe they will pull AWD forward to get margin?
 
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TradingInvest

Active Member
Mar 8, 2017
1,697
13,689
USA
Don't forget BYD. Yep, Warren should be investing in TSLA too. Ain't no dividends but there is huge value!

It's a long story. Charlie Munger met Lu Li in 2002, who helped to invested Charlie's money into BYD. It was a great early investment. Recession came in 2008. Charlie persuaded Warren to buy BYD. At one point Charlie said if BRK doesn't buy BYD, he might have to sell his BRK shares. Turns out Chuanfu Wang (Founder/CEO of BYD) only willing to sell 10%. So BRK got 10% of BYD at a very low price.

Probably because Charlie saw how hard BYD had to struggle even with so much government backing, during a Daily Journal shareholder meeting, he basically said Tesla will fail. Elon is a real genius who has IQ of 190 but mistakenly thinks he has 250. He did stress if someone is going to get it done, it's going to be Elon. Later Elon went to ask Charlie why did he think Tesla would fail.

For a long time they didn't think Tesla can make it. Then Tesla becomes a competitor against some of BRK's divisions. Business competition is like war, people tend to hate their competitors. It's very unlikely that BRK will invest in Tesla.

I respect Warren and Charlie a lot, but they are wrong on Tesla and Elon. I sold all my BRK a while back and moved to Tesla.
 

TradingInvest

Active Member
Mar 8, 2017
1,697
13,689
USA
Chicago is the rail hub for the nation and has direct access to Europe through the Great Lakes. Labor is plentiful. Getting more factories should end that flight.

Yesterday I wrote politicians and Tesla about the popularity of small SUVs among Midwesterners and suggested a Model Y factory in Chicagoland. Here is how a Tesla agent responded:

Hi Curt,
Thank you for being a shareholder and bringing this concept/idea to our team!
I will definitely pass this article along. Really interesting.
Model Y will definitely be a game changer for the smaller electric SUV on the road. So exciting!
We appreciate your passion for our company and support.
Best,
Jenifer Strom

Thanks Curt for all your help! You are helping Tesla, Tesla shareholders, and ultimately helping the world to get better!
All of us shareholders should do more like this.
 

stealthology

Member
Jan 24, 2013
467
642
Hawaii
From this AM FWIW:

(10:31:22 AM):
Musk Revs Up Tesla Bond Buyers by Selling Them Debt With Dream
Company’s $1.5 billion offering said to be in strong demand
Investors lured by ‘halo effect’ ignore record cash burnBy Nabila Ahmed, Sridhar Natarajan and Molly Smith
(Bloomberg) -- Tesla Inc.’s Elon Musk is selling his dream. Bond investors seem to be closing their eyes and buying it. Musk brought his charm offensive to the debt market at a meeting for bond buyers in Manhattan on Monday and came away with orders for $600 million after just a few hours, according to investors briefed on the matter. The session was part of a four-day debt-marketing extravaganza aimed at raising $1.5 billion to support the electric carmaker’s new mass-market Model 3.
 

Waiting4M3

Active Member
Apr 13, 2016
3,328
12,066
San Jose, California
Given past global manufacturing challenges I can easily image a sweetheart deal for a nice fleet of either B747-8 or A380 freighters plus some substantial sea arrangements that would provide for components in one direction and completed products in other directions.
"Hey FedEx, this is Tesla, how about a nice shiny new fleet of Semi's for some discount on some logistic help?"
 

ValueAnalyst

Closed
Aug 25, 2016
5,371
11,124
World
I still think that dilution depends on the stock price. If TSLA hits $2000 by February, I'm pretty damn sure Tesla will issue some stock. The question is basically *are you selling at the right price* -- as a competent company, you want to issue stock when it gives you better ROI than issuing bonds. (I do not think that $2000 in February is likely, for the record.)

It also depends on whether the bond markets close up. Tesla can issue bonds at a decent interest rate, but the question is how *much* can be issued at that rate.

It also depends on how leveraged the company gets. If the debt to equity ratio starts looking high (it looks great right now) it would make sense to issue equity for further expansion -- but again, only if the stock price is significantly higher than today.


I actually doubt Musk will buy any of the debt. I think he'll save his money to buy more stock. He really would prefer to be running a private company.

Even at $2,000, it makes more sense to issue debt. Tesla's intrinsic value, which incorporates the future of Tesla, is more (my opinion).

Not an advice. Even if my intrinsic value estimate is correct, it may take more than a decade to get there.

I'm holding stock with moderate margin and some Jan19 LEAPs.
 

neroden

Model S Owner and Frustrated Tesla Fan
Apr 25, 2011
14,676
62,627
Ithaca, NY, USA
Project Tim = tim cook = apple ?

Or one of the Tims involved in https://www.lw.com/thoughtLeadershi...n-projects-benefit-from-enhanced-oil-recovery because http://www.durandnow.com/Project_Tim_Highlights-page-002.jpg mentions EOR.

Enhanced Oil Recovery does not smell like Apple nor Tesla though... Maybe it is the fossil fuel industry with Softbank's $100b fonds and Toyota and Honda creating some anti-EV bastard together with Chevron ?

I sure hope its tesla instead...
Yeah, the Enhanced Oil Recovery thing makes me think it is not Tesla or Apple. But on the other hand, maybe it's a big red herring designed to mislead.
 

neroden

Model S Owner and Frustrated Tesla Fan
Apr 25, 2011
14,676
62,627
Ithaca, NY, USA
Regardless of the question on exactly how much dilution shorts are betting, both you and Ron Baron are objectively wrong.



And then there is the question how much the purchase of the lower-quality Solarcity dilutes higher-quality Tesla share holders of course. But that's obviously a more subjective assesment that may show my bias.
The SolarCity merger was in some ways an equity capital raise at a good price. As many have pointed out, selling all the existing leases raises a lot of cash; they weren't being valued at their cash sales value before the merger due to refinancing fears.

I haven't done the math but I believe that cash was worth more than the dilution.
 

neroden

Model S Owner and Frustrated Tesla Fan
Apr 25, 2011
14,676
62,627
Ithaca, NY, USA
UPS has a super hub in Louisville KY which they chose because its logistically located at the center of about 80% of the US population. It is mostly an overnight hub (planes) but I am sure they sort a large volume of ground packages being transported between the 80%. You are aprox. 1000 miles to Boston, Miami and Dallas/Houston.
Good location for air, sucks for ground transportation. The railroad and expressway connections are poor, largely because most of the routes have to go through the Appalachians, and the remainder have to cross the Ohio River or the Mississippi.
 
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neroden

Model S Owner and Frustrated Tesla Fan
Apr 25, 2011
14,676
62,627
Ithaca, NY, USA
Energy Storage: negative gross margins in 2017 so far... revenues so small it's basically lumped into a category masked by Solar City

myusername: you're wrong. I'm quite sure energy storage has got positive gross margins.

I think Tesla is pulling an Amazon here, masking business details by failing to break out business segments. (Bezos hates to give details for some reason.) This doesn't mean the business isn't profitable. It's profitable. It means Tesla doesn't want you to know how profitable it is, and there could be several reasons for this. Tesla doesn't release monthly car sales because they were annoyed at how stupid the press were about it. They might not release quarterly battery sales for the same reason: it's lumpy and they don't want people to get the wrong idea.
 

LargeHamCollider

Battery cells != scalable
Jan 10, 2015
958
1,774
United States
Project Tim = tim cook = apple ?

Or one of the Tims involved in https://www.lw.com/thoughtLeadershi...n-projects-benefit-from-enhanced-oil-recovery because http://www.durandnow.com/Project_Tim_Highlights-page-002.jpg mentions EOR.

Enhanced Oil Recovery does not smell like Apple nor Tesla though... Maybe it is the fossil fuel industry with Softbank's $100b fonds and Toyota and Honda creating some anti-EV bastard together with Chevron ?

I sure hope its tesla instead...
My shares are happy so long as it's not Apple, an Apple Gigafactory could be a bit of a black swan for Tesla, especially if their timeline is aggressive or they release specs and renders early.
 
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neroden

Model S Owner and Frustrated Tesla Fan
Apr 25, 2011
14,676
62,627
Ithaca, NY, USA
We all must hope that you're correct. I certainly do. When we're expanding coal production on Federal land and exporting the results we might not be convinced that the attitude will change with Mr. Zinke remaining. Stranger things have happened so there still is hope. I cannot plan on hope, though.:(
The death of coal was always going to come from the demand end. You can't export coal if nobody wants to import it. Coal plants are shutting down *everywhere*. India and China both have explicit plans to eliminate coal imports. The way to knock out the rest of the coal industry is simple: cheaper solar and wind, more solar and wind, more batteries.
 

LargeHamCollider

Battery cells != scalable
Jan 10, 2015
958
1,774
United States
The death of coal was always going to come from the demand end. You can't export coal if nobody wants to import it. Coal plants are shutting down *everywhere*. India and China both have explicit plans to eliminate coal imports. The way to knock out the rest of the coal industry is simple: cheaper solar and wind, more solar and wind, more batteries.
Solar and wind are already cheap enough imo (not that they can't get cheaper still), batteries are now the missing piece and they'll be there soon. These are exciting times.
 
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