2017 Investor Roundtable:General Discussion

[bonnie]

RWD rollout first is because it simplifies production, giving them more time to work out the kinks on AWD. Remember Model S was RWD first as well, before rolling out AWD. It makes sense to me.

Remember all the first production goes to employees of Tesla and SpaceX. I can't imagine they've all ordered 2WD.

What is probably the most likely is that employees that order 2WD will see those before employees ordering 4WD. When Model 3s start shipping to the rest of us, all offerings will be on the Design Center page. So really, 4WD will likely be offered right from the start for the public. (Just my opinion.)

 

[Snapdragon III]

On the Union organizing story, which sounds like total BS to me, but is being picked up by a lot of click hungry "news" organizations. Does anyone know if the claim that Fremont workers are making $17-21 an hour is anywhere close to true? I had assumed that they would be making more like $25-30. Although that is based on no actual knowledge.

 

[MitchJi]

Must watch: (very interesting insider info regarding model 3 starting at 2:55).

Also, read the top comment.

(Posting in this thread as well due to importance).

Important misinformation!

BTW automation is also coming to the drilling industry. Robotics threatens to cut the size of drilling crews by a third, and the jobs that remain will require a higher skill set. Automation also wiped out most of the jobs in coal mining.

Environemental destruction (mountain top removal) wiped out most of the jobs in coal mining.

Keep in mind, mgmt has said they designed the ramp to be cash generating. At a low run rate, cost to produce is much higher than at a large run rate. Making your cheapest model when cost to produce is highest only generates cash if margins are quite high. I don't think it's possible to build your trim at a profit until at least 250k run rate and possibly even higher, I definitely don't see that kind of run rate super early in the ramp.

What exactly do you mean by a low run rate? Elon said 100-200k in 2017 (starting in September-November?).

You know this is several years away right?
The current factory is version 0.5. AD IS version 2 or 3. The planned timing for major releases was 2 years, so AD Is a minimum of 4 years away at current plan.

Why do you think that alien dreadnaught v0.5 will be slower than the fastest conventional line which Elon constantly refers to as one car per 25 seconds?! Production of an ev designed for easy production should be able to increase the speed compared with a conventional ice even without any ad innovations.

Btw the first times that Elon talked about alien dreadnaught he said ultimately 5-10 faster than the fastest conventional production line. The last time, when incidentally he confirmed my speculation about alien dreadnaught being a major competitive advantage, he also said 5-15 times as fast. In other words his belief in the speed that they will ultimately be able to optain is increasing!

 

[Oil4AsphaultOnly]

RWD rollout first is because it simplifies production, giving them more time to work out the kinks on AWD. Remember Model S was RWD first as well, before rolling out AWD. It makes sense to me.

model S RWD-before-AWD had nothing to do with production, and everything to do with engineering. Now that the engineering's done, model 3 production will be based on profitability. Using the model S's 75D rollout as an example, AWD will come out first, and then RWD will be offered to hit the $35k target.

The batteries and motors are being built in the gigafactory, there's almost no impact to the fremont assembly line regardless of AWD or RWD (other than the extra step of adding that 2nd motor).

 

[DurandalAI]

On the Union organizing story, which sounds like total BS to me, but is being picked up by a lot of click hungry "news" organizations. Does anyone know if the claim that Fremont workers are making $17-21 an hour is anywhere close to true? I had assumed that they would be making more like $25-30. Although that is based on no actual knowledge.

According to glassdoor.com production associates make an average of $17.71/hr, up to $21/hr.

 

[Intl Professor]

Oh, Austinmonkey.
Bad, bad monkey!
Go to your room, sit down, watch this and do not return to the forum until you've down this homework.

and, for extra credit, this:

You're another dirty old man.

 

[DurandalAI]

model S RWD-before-AWD had nothing to do with production, and everything to do with engineering. Now that the engineering's done, model 3 production will be based on profitability. Using the model S's 75D rollout as an example, AWD will come out first, and then RWD will be offered to hit the $35k target.

The batteries and motors are being built in the gigafactory, there's almost no impact to the fremont assembly line regardless of AWD or RWD (other than the extra step of adding that 2nd motor).

Good points, and you may be right. We'll have to see. If the RWD version isn't available at the beginning, I'm sure the media will howl that "Tesla missed their $35k entry price point" or some such nonsense.

 

[dirtyofries]

Good points, and you may be right. We'll have to see. If the RWD version isn't available at the beginning, I'm sure the media will howl that "Tesla missed their $35k entry price point" or some such nonsense.

My bet is, however, they'll take the orders for them, they just won't produce/deliver them first.

 

[techmaven]

Good points, and you may be right. We'll have to see. If the RWD version isn't available at the beginning, I'm sure the media will howl that "Tesla missed their $35k entry price point" or some such nonsense.

Not as long as the order page allows for a spec that will eventually ship. Remember, the volumes are much, much higher and therefore it won't take nearly as long for the lower spec versions to go out the door. Not like the 40 kWh Model S at all, for example.

 

[kenliles]

Electrek has some interface shots and coverage of the new Mobile App soon to be released for those interested
First look with pictures at Tesla’s new mobile app with new UI, touch ID, and widgets

 

[AudubonB]

According to glassdoor.com production associates make an average of $17.71/hr, up to $21/hr.

Hmmm....
I'm smelling some very unpleasant strong chances of important misinformation there, as follows:

regardless of what definition you use for "average" - mean, median, mode, arithmetical average, etc. - if $17.71 really is one of those numbers, and if rates also go up to $21, then it has to follow that some employees are getting a significantly lower number - $14 or $15/hr, or thereabouts.

And even in an area (Fremont labor pool region) otherwise lacking in much opportunity for low- to semi-skilled labor, that sounds too far out to be believable.

Response?

 

[austinEV]

Electrek has some interface shots and coverage of the new Mobile App soon to be released for those interested
First look with pictures at Tesla’s new mobile app with new UI, touch ID, and widgets

View attachment 214177

Pretty, but nothing really new that I see.

 

[Waiting4M3]

No, my math shows the differential cost to build a base Model 3 (the ~$6500 in additional battery cost not covered by savings from electric motor instead of ICE) over a loaded Cruze (which is a similar size, and so should use a similar quantity of raw materials, and have similarly specified braking and suspension components). Presupposing that the fully loaded Cruze has a profit margin greater than zero, it would follow that a base Model 3 should also have a similar profit margin, since the price delta is approximately equal to the cost delta.

Additionally, Tesla has a $994 advantage on advertising spending. Tesla (TSLA) Only Spends $6 Per Car on Ads, Versus $1000 for the Industry - Chowdhry

My mistake, I misread your post on your math. Not to be too nitpicky, what's your opinion on the M3's AP2 HW cost vs the stuff in the loaded Cruze? A loaded Cruze has rear camera, and whatever radar/sonar that does forward collision warning, lane keep assist, side bind spot and rear cross traffic alert.

 

[DurandalAI]

Hmmm....
I'm smelling some very unpleasant strong chances of important misinformation there, as follows:

regardless of what definition you use for "average" - mean, median, mode, arithmetical average, etc. - if $17.71 really is one of those numbers, and if rates also go up to $21, then it has to follow that some employees are getting a significantly lower number - $14 or $15/hr, or thereabouts.

And even in an area (Fremont labor pool region) otherwise lacking in much opportunity for low- to semi-skilled labor, that sounds too far out to be believable.

Response?

Well, I'm not sure how Glassdoor gets their info, but $14 was on the low end of another salary listing on there. I would assume it depends on where you are in the production line. It's also possible that the Glassdoor numbers are modified by those with ulterior motives, I don't know what kind of validation they do... For evidence, I will produce a screenshot.
Edit:
That was tedious in adding a photo. I must be doing it wrong.
Also as a side-note, the numbers changed from when I last went in there... That $14 on the low end isn't showing up any more.

TeslaSalaries

• DurandalAI
• Feb 10, 2017

Tesla Salaries

 

[mmd]

Meanwhile GM employees are happy with their bonuses
GM Factory Workers Take Home $12,000 Bonuses On Record 2016 North American Profits

General Motors' 52,000 hourly workers will take home profit sharing checks of up to $12,000, after the U.S. automaker racked up a record year in 2016, including $12 billion profit in North America.

All three Detroit automakers have agreed to share the wealth with workers in North America. The GM profit-sharing bonuses are the biggest yet. Ford, which earned $9 billion in North America last year, will pay an average $9,000 to more than 56,000 unionized auto workers. Fiat Chrysler Automobiles will pay $5,000 extra to some 40,000 unionized workers after posting a $5.1 billion profit in North America.
...
Profit-sharing is a benefit first negotiated by the UAW in 1982, but the formula has been simplified in recent years. It is based on earnings before interest and taxes in the North American region. This is the first payout under the 2015 contract.

 

[snellenr]

According to glassdoor.com production associates make an average of $17.71/hr, up to $21/hr.

Given glassdoor's methodology (self-selected submissions), a grain of salt is in order...

 

[Waiting4M3]

At a low run rate, cost to produce is much higher than at a large run rate. Making your cheapest model when cost to produce is highest only generates cash if margins are quite high. I don't think it's possible to build your trim at a profit until at least 250k run rate and possibly even higher, I definitely don't see that kind of run rate super early in the ramp.

I think the cost penalty to produce FWD/AWD and P vs non-P trim levels right from the start won't be too bad. I'm basing on the below cost breakdown.

• 1 time design and tooling cost, these gets spread over the lifetime of the whole model, it doesn't apply specifically to early production phase
  
• labor, the unit cost should be roughly a constant, per hr cost doesn't change much with run rate, also the labor cost for the entire M3 line should not depend too much on the trim mixture, but rather depend on the overall run rate of the line
  
• consumable, such as the utility needed to run the factory, robots, this also just depend on the overall run rate of the M3 line, and not much on the trim mixture.
  
• parts/material, this is where the cost could scale significantly with run rate if some trim has some unique parts. However AFAIK the major difference in component are the motors between the FWD and AWD, P vs non-P, and the size of battery packs.
  • The packs are all uniform in size, just difference in # of modules, so the cost should not scale too badly with run rate of any particular trim.
  • The motor cost can definitely scale with run rate of particular trims, but they cost <<$1000 each, so how much difference can it make in the overall cost and profitability of the car?
• Logistics such as order/delivery, this also does not matter too much on mixture of trims.

 

[DurandalAI]

Given glassdoor's methodology (self-selected submissions), a grain of salt is in order...

I'm sure it is dependent on the position and whether or not bad actors are involved. I've looked at Glassdoor salary ratings for other jobs that I've had, and found them to be consistent. Then again, I don't work for Tesla or any other newsworthy company.

 

[jhm]

for those in previous posts discussing the timing of the G-Factory parking lot:
Instagram post from yesterday 9Feb2017
Instagram photo by Wendy Scott • Feb 9, 2017 at 9:09pm UTC

View attachment 214160

Trump is sure he saw more cars at his inauguration. Most cars ever.

 

[jhm]

Environemental destruction (mountain top removal) wiped out most of the jobs in coal mining.

Yes, that is exactly what I was referring to. My point was labor displacement by machines. And the environment suffers too.