2017 Investor Roundtable:General Discussion

[DragonWatch]

Ford, original, believed that he could sell more cars if he paid his labor force enough to in turn be able to purchase a car.

When I enlisted in the army back in 1969, I made $99 a month and you are right it was a different economy then. Oh, and the saying went "if the army wanted you to have a wife, the would have issued you one." I managed to save mone over the years and did not have a wife early on.

Another philosophy was that as long as you paid your soldiers, got them their mail, and fed them ~ they would be happy campers. Housing, well that ranged from open bay barracks, to tents, or just a fart sack on the ground. Housing was a perk

Please correct me if I am wrong, but I think the Supreme Court ruled the arm could not unionize back in the late '70s.

Bottom line if you do not take care of your people ~ be they a company workforce or a nation full of people ~ they will rise up and bite you in the ass.

Nine out of ten, management/leadership fails and I mean they fail to the extreme. Management is the know it all and labor is just too damned stupid. Just ask either one ~ they will tell you point blank. Because I am not directly involved as an investor (cannot just walk in and question management or labor), or as an employee, I cannot say anything of truth about how to handle the situation.

While as an investor, and soon to be owner of a blue MX, I have to default to Elon. I have never been a paint the rocks make work kind of person. I do not just let folks walk over me either. If someone thinks they have run over me, then apparently the forgot to check their two rear tires.

For now, again I have to hope Elon will do what is best for the overall mission of the company ~ and that taking care of his people is paramount to the success of providing me a car that is alternative fuel, and built like no other (extremely well).

 

[mmd]

Point is that the numbers are only this good for employees that work there since March 2013. That's actually a minority of current employees, and depending on turn over maybe even a small minority. For example, getting hired just 6 months later means a $20k less compensation package. If you are comparing against averages of other companies, I think it is fair to compare with your actual average and not with the (minority) employees that happen to have the an unequalled run up in their stock options worth.

Yes, agreed. Tesla has also grown a lot over the last few years. Most of the current employees couldn't have been there in Jan 2013 to take advantage of the low SP. Those few early employees took some risk, and now they have some rewards if they held on to the stock and still work for Tesla. This number is probably very small.

IMO, we shouldn't use the stock option figures from quarterly reports. Lion's share of that goes to the CEO and top execs. Low level factory workers get only a small portion of that.

 

[vgrinshpun]

Yes, agreed. Tesla has also grown a lot over the last few years. Most of the current employees couldn't have been there in Jan 2013 to take advantage of the low SP. Those few early employees took some risk, and now they have some rewards if they held on to the stock and still work for Tesla. This number is probably very small.

IMO, we shouldn't use the stock option figures from quarterly reports. Lion's share of that goes to the CEO and top execs. Low level factory workers get only a small portion of that.

The awards are ON-GOING incentives, awarded periodically. The value of package calculated by Musk is NOT totally defined by the award at one point in time, as you seemingly try to portray it.

Musk mentioned that there will be another sizable award upon successful launch of M3. He also mentioned that he expects that performance of the package going forward will be comparable to the performance outlined in his e-mail to the employees.

 

[Krugerrand]

Does not seem that the issue of unionization at Fremont is going to be going away any time soon. It seems quite simple to me, as what Musk is offering to employees is a buy-in into the goals of the company, while giving them additional potential sizable reward which comes with some risk, as opposed to them just being a crew for hire. Not everybody, obviously, sees it that way: What's at the root of Tesla's labor troubles?

“I think [Musk’s] response [to possible unionization] is directly related to his desire to have a stronger control over the company,” he says.

Well, duh!

To keep pace with the new demand, Tesla plans to increase its Fremont workforce from 6,210 to 9,315. But it’s not certain whether this investment will pay off. According to Business Insider’s Matthew DeBord, “A $35,000 compact sedan brings in a lot less than a $100,000-plus mid-size SUV. For Tesla, the Model 3 is a far greater risk than the Model S or X were.”

Oh, stop! Mr. DeBord should find another topic to comment on.

Mr. Wheaton says that this risk places far more pressure on Musk to get it right. “He can't afford to lose something,” he says of Musk. “If unionization takes away his ability to tell people to do whatever he wants, and go the extra mile, [and say,] ‘We don't care, our company need this,’ ...I think that's part of his frustration."

Duh, again!

In the end it boils down to what it has always boiled down to; not everyone can or should work at Tesla. If you're not a fit, leave. I said it before, not for one second do I believe some angelic intent on the part of Mr. Moran to make Tesla better. He was a union worker and wants to be a union worker again. Go pee in someone else's sandbox.

 

[FredTMC]

Point is that the numbers are only this good for employees that work there since March 2013. That's actually a minority of current employees, and depending on turn over maybe even a small minority. For example, getting hired just 6 months later means a $20k less compensation package. If you are comparing against averages of other companies, I think it is fair to compare with your actual average and not with the (minority) employees that happen to have the an unequalled run up in their stock options worth.

My view as a capitalist is very simple.

Tesla pays employees enough compensation to attract and retain good employees. I don't know what's tesla's attrition rate is but I'm sure it's measured... just like worker safety (which is apparently fine too)

Last I checked its still a free country. Work wherever you like.

 

[jhm]

Strange how actually owning a Tesla makes you more confident about the future of Tesla isn't it? It happened to me too. I was very optmistic, but with some doubts, before I got my S. Those doubts disappeared the first time I drove my S home.

This author at Oilprice.com is now an EV driver, and it seems to be impacting his thinking on demand for oil.

Why Oil Demand Forecasts Have Become A Guessing Game | OilPrice.com

 

[Krugerrand]

Point is that the numbers are only this good for employees that work there since March 2013. That's actually a minority of current employees, and depending on turn over maybe even a small minority. For example, getting hired just 6 months later means a $20k less compensation package. If you are comparing against averages of other companies, I think it is fair to compare with your actual average and not with the (minority) employees that happen to have the an unequalled run up in their stock options worth.

Wait a second. Remind me how long Mr. Moran has been at Tesla? He's the one who started it this time around and is crying the loudest.

 

[geneclean55]

Wait a second. Remind me how long Mr. Moran has been at Tesla? He's the one who started it this time around and is crying the loudest.

Boom!

 

[MitchJi]

Tesla owners qualify for a $500 rebate in Northern California:

Clean Fuel Rebate for electric vehicles

Receive a $500 Clean Fuel Rebate

As an electric vehicle (EV) owner, you're contributing to a cleaner energy future by fueling your vehicle with electricity. PG&E customers with EVs are eligible to receive a $500 Clean Fuel Rebate for their use of electricity as a clean transportation fuel.

Learn about the Clean Fuel Rebate program
The Clean Fuel Rebate comes from a State of California program called the Low Carbon Fuel Standard (LCFS). The Low Carbon Fuel Standard is fighting climate change by encouraging the adoption of clean vehicle fuels such as electricity. PG&E earns credits in the program when customers use electricity at home to charge their electric vehicles. PG&E returns the value of these credits to its electric vehicle customers through the Clean Fuel Rebate.

Find out about the eligibility requirements for the Clean Fuel Rebate

• You must be a PG&E customer with an active residential electric account. As the account holder, you may also apply on behalf of an EV owner in your household (or tenant in a multifamily household) with the vehicle owner’s permission.
• You must own or lease an eligible plug-in electric vehicle or have permission from the vehicle owner to submit the application.
• Your vehicle, identified by its unique vehicle identification number (VIN), must not have already received the Clean Fuel Rebate under the current owner or any previous owner.
• You must have paid the vehicle's current registration fees and your vehicle must be registered in California to the address on your PG&E account.

Apply for your rebate through a simple online application
To complete the application process, you'll need the following:

• Your PG&E account number. Find your account number at the top of your energy bill. Your account must have active residential electric service to be eligible.
• Your current vehicle registration card. If you recently purchased or leased your vehicle and haven't received your registration card yet, you may provide a copy of your purchase or lease contract instead.

Once submitted, PG&E will review your application to confirm eligibility. If approved, your Clean Fuel Rebate check will be mailed to the address on your PG&E account.


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[MitchJi]

I'm somewhat confused. What are we disagreeing about? Seems like both of us are saying their previous testing procedures, especially related to the Model X, aren't optimal. And both of us think Tesla has a good chance at fixing that and making a good quality Model 3. Am I missing something?

I was referring to your statement that the problem was insufficient testing, which you thought (at least in your earlier post) posed a high risk to the M3 ramp. And l didn't make my point very clearly.

I believe that the only way to throughly test the production line is to actually use it to produce cars. The problem is what do you do with the first cars off the line? Tesla's solution to that problem has been to sell those cars, and attempt to fix the problems while keeping customers happy, which kind of worked with the roadster and the MS.

A major part of the problem with doing that with the MX is that it took months to fix all of the production problems. As far as we know Tesla is not trying to fix the problem by more through testing of the production line. Tesla is trying as hard as possible to simplify the car to reduce or eliminate the potential problems.

Plus selling the first 10k cars to employees. Maybe you are correct that we are not disagreeing.

 

[Zhelko Dimic]

Yes, agreed. Tesla has also grown a lot over the last few years. Most of the current employees couldn't have been there in Jan 2013 to take advantage of the low SP. Those few early employees took some risk, and now they have some rewards if they held on to the stock and still work for Tesla. This number is probably very small.

IMO, we shouldn't use the stock option figures from quarterly reports. Lion's share of that goes to the CEO and top execs. Low level factory workers get only a small portion of that.

Options are unpredictable, but part of the Tesla appeal is that many of us believe it will do well, including SP.

Factory worker from 2013 will make much,much more money than Detroit worker if he keeps options and Tesla hits $1xxx in few years, as many of us believe. Now, you could emulate this by investing too, but holding 10 year option granted is much, much easier than tying your money in an investment. I used to work for a small Internet company for 15 years(TCX), and options paid my mortgage. They were worthless first 10 years.

Having said that, you either believe, or you don't; and if you don't, as an investor, I'd prefer you (worker) leave, rather than bring UAW.
Now, the only thing is, I'm not sure my opinion counts

 

[RobStark]

Plus selling the first 10k cars to employees. Maybe you are correct that we are not disagreeing.

Then selling to current owners. Which makes non-owners who can't afford a Roadster,Model S, or Model X grumble.

But that is exactly the point. Sell to those first which will more likely give you feedback without roasting you on Youtube and the internets.

 

[MitchJi]

From @DaveT's weekly newsletter:
Legendary AAPL analyst, Gene Munster, shares his thoughts on TSLA. Munster was one of the best-known analysts covering AAPL over 15 years. His thoughts on Tesla are a great read, and a must if you're a TSLA investor. He was also on CNBC two times being interviewed regarding TSLA. Video interview #1 and video interview #2.

Tesla’s Bedrock In AI & Robotics Will Transform The Industry & Our Lives | Loup Ventures

I always wanted to cover Tesla, but as an internet analyst, the stock fell outside of my coverage space. Despite this, I continued to study the company and ultimately invested because I believe that Tesla is not a car company, but a consumer electronics company that thinks like an internet company. With a bedrock in AI and robotics, Tesla is one of the best positioned companies to transform our lives over the next 20 years. We think Tesla is on par with Amazon when it comes to a reckless pursuit to shape the future, which we believe will reward investors over the long run.
<SNips>
This begs the question, why would anyone interested in an autonomous car buy an L3 compatible vehicle if it was priced similar to an L4 vehicle?

Good question. Autonomy will be huge!

 

[JBRR]

Trump administration re-evaluating self-driving car guidance

Seems like neutral news so far, but it's something worth keeping an eye on.
This might be something where it will turn out beneficial having Elon on Trumps council.

 

[neroden]

Google is proposing to do this in Mountain View - unsuccessfully so far.

Google pitches housing project in East Whisman

Tangent: God, I wish that particular VTA line had been designed properly. It's amazing what a mess it is. It could have been designed so that it would obviously connect Google offices to housing. It doesn't. It doesn't work well for any of the other tech company campuses on the Peninsula either.

 

[mmd]

Tangent: God, I wish that particular VTA line had been designed properly. It's amazing what a mess it is. It could have been designed so that it would obviously connect Google offices to housing. It doesn't. It doesn't work well for any of the other tech company campuses on the Peninsula either.

VTA line has been there a long time. Google is new. It opened up close to our work back in 1998. Who knew it will grow so big? Google is welcome to San Jose Cheaper housing. The peninsular area is too congested and not much room left. I believe there are connecting shuttles from the VTA stations to many companies during morning hours. At least it's there near Cisco in San Jose. I used it few days when gas prices were $5. So it isn't too bad.

On a different note, here is Steve Woz going gaga over his Bolt in San Jose Mercury News
Roadshow: The Woz and his cars are back! (Guess what he's driving now)

I abandoned the Prius for a Tesla two or three years ago. I love our new Bolt and use it for almost all of my own driving now, including a recent road trip to Anaheim. I figured I’d share my driving between this and our Tesla but I’m using the Bolt almost exclusively.

This car is nice to drive, small, light, easy. It feels like the Prii I drove. Now I’m sort of back to the Prius because that’s the feeling I get from the Bolt — easy and convenient all the time. I still think highly of the Prius and it was the major go-to car of my life for 10 years. The Prius had more luggage space and I could carry two Segways in it but I’m not often taking Segways in my cars anymore, and the Bolt is easier to park anywhere than the Prius was. Both of those cars are easier to park than the Tesla.

I could easily wind up someday with a full-EV Prius. That’s what I’m doing these days. Full EV. Tesla, Bolt, Segway.

 

[AudubonB]

Anyone with the social status and fanstardom of Steve Wozniak who also falls for and thereupon abets in the dissemination of the "plural of Prius is Prii" gobbledygook nonsense is, to this grammarian, more than welcome to not drive as many Teslas as aren't available.

 

[kenliles]

Elon tweet:
"SpaceX announcement tomorrow at 1pm PST"

Elon Musk on Twitter

 

[PaulusdB]

So what do we think SpaceX's opening bid on Tesla will be?

 

[geneclean55]

Market sensitive timing. Interesting