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End of session summary about winners and losers:
"Loser: Mega-rich guys from out of state
It’s a well-worn trope in politics: Money is power. But this session, two of the richest people in the world didn’t get their way. After swooping into town to meet with state leaders, Nebraska billionaire Warren Buffett (the second-wealthiest person on the planet, according to Forbes) seemed on the fast track to get a bill through the Capitol that would have let him bypass state regulations barring him from owning a vehicle manufacturer and car dealerships within the state. His legislation, which became known as the Buffett bill, died in the Senate after outcry from Tea Partiers and other activists. Meanwhile, Tesla, the electric car company owned by South African billionaire Elon Musk, was pushing for bills that would have allowed it to sell its vehicles directly to consumers. Despite an army of lobbyists on his side, the bills went nowhere."
The winners and losers of the 85th session of the Texas Legislature
As a novice on corporate accounting practices I'm curious to know how this might normally be calculated. Isn't a capital expenditure of $X depreciated over 5 years? So from some date at which $Y dollars have been invested to build a facility, in each year 20% of Y is spread over the number of units produced that year? If that's somewhat right, then doesn't the phased cap expenditure for each new GF section(s) completed over time going to result in a series of simple calculations summed to a total that applies to each new year and that is used against number of 'units' produced for the year?
ValueAnalyst
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Management needs to first estimate ahead of time how many units will be produced over the life of the asset.
Units of Production Method of Depreciation | Accounting Explained
kenliles
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erthquake
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From reading here, Tesla appears to be managing their cash very carefully. They're not spending money until they absolutely have to. See the recent $216 million expenditure approval for the Model 3 battery lines for an example. Though they are getting 60-90 day terms on their parts orders, they wouldn't be ordering in those quantities unless they were very confident in that ramp schedule.
I don't know SK Innovation, what their financial and technical capabilities may be. However some back of napkin calculations suggest that their president is whistling in the dark on reaching 30% of world battery production by 2025. Perhaps SK can reach 10 GWh by 2020.
I believe that led by Tesla, world production by 2020 will exceed 200 GWh by then. While Tesla's last stated target for 2020 is 1 M vehicles, I think it likely they will reach 1.5 M by then. I think year to year they are likely to increase production 50 to 75%. Assuming 75 KWh
per vehicle they'd need to produce 95 GWh by 2020. Add in battery production by Chinese companies and other heavy weights, plus more yet for storage applications and world production can be estimated in the 300 GWh range by then. That would leave SK (if they reach their stated target for 2020) at 3 - 4 % of world production. As long as Li and Co producers get and make investments to ramp their production that fast during 2020 to 2025, I see no reason why year to year battery production won't keep rising at the 2017 thru 2020 rate. I.e. SK would have no chance in this scenario to reach 30% in five more years. @ValueAnalyst and others have made well reasoned predictions for an event steeper ramp, so I'd think my simplistic projection is if anything perhaps a tad conservative.
Tesla/Panasonic currently produces ~9GWh in Fremont/Japan, ramping to 50GWh in 2018 and 150GWh in 2020 in GF1.
And these guys are targeting 10GWh in 2020, and 33GWh in 2025, and they think that will be 30% market share.
Yeah Tesla is doomed.
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@DaveT I'll be in San Diego tonight. If you run into someone really really really ridiculously good looking, feel free to say hi.
I think the author is basing his conclusion too much on his one experience at one Tesla store (seems that there will be a series so there could be more).
China has two kind of rich. Private sector rich and public sector rich. Most of them from both sides used to love showing off their status. But after Xi's campaign of anti corruption, the public sector rich has reined in a lot. Private sector rich is still running as they were mostly.
I don't understand why the author is complaing model X being too expensive. Other luxury cars (sedan and SUV) are much more expensive in China (e.g. Porsche Cayenne fully loaded is almost twice the price of a fully loaded model x). Based on his comment on price, I'm not sure he understands luxury car market in China that well tbh.
kenliles
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RobStark
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Any take by "someone that might know more" is anecdotal.
It is an issue that can't be approached with scientific exactness.
It is an opinion on the psychology of the Chinese wealthy.
It is not a problem if every automaker is the same, has the same take on how to approach selling to China's wealthy, and Tesla is probably the least elitist.
Just wanted to drop my annual note on the annual meeting - do not expect any significant announcements or catalysts from the Annual Meeting. These are designed to vote on mostly routine annual matters discussed in the proxy (director voting, auditor selection, advisory vote on executive compensation, etc.). Official business typically lasts like 10-15 minutes depending on the length of any prepared remarks.
The Q&A is sort of an optional, gratuitous add-on. You will see primarily low-quality questions from retail investors and similarly low-quality vague answers from Elon. The main thing I am looking for is reassurance on the Model 3 timeline, which is probably the best news to reasonably hope for. If his answer deviates at all from the standard "on track for July" I'll have some concern that a critical path delay has presented itself since the last earnings call. I do not expect on details of any possible delay, however. Again, this isn't the venue to break significant news of any kind.
On a related note, I do not expect that the recent runup is in any way related to the upcoming Annual Meeting. I would hope the bigger investors responsible for moving the SP are already aware of what I wrote above and are not looking to sell the news when nothing substantial comes out of the meeting.
The Q&A is sort of an optional, gratuitous add-on. You will see primarily low-quality questions from retail investors and similarly low-quality vague answers from Elon. The main thing I am looking for is reassurance on the Model 3 timeline, which is probably the best news to reasonably hope for. If his answer deviates at all from the standard "on track for July" I'll have some concern that a critical path delay has presented itself since the last earnings call. I do not expect on details of any possible delay, however. Again, this isn't the venue to break significant news of any kind.
On a related note, I do not expect that the recent runup is in any way related to the upcoming Annual Meeting. I would hope the bigger investors responsible for moving the SP are already aware of what I wrote above and are not looking to sell the news when nothing substantial comes out of the meeting.
Sounds like the new broom won't be starved for capital:
"It is unclear how much of a hand Hackett has had in the mobility deals Ford has inked since he joined the company as an executive. In the past year, Ford announced investments in lidar maker Velodyne and 3D-mapping company Civil Maps. It also acquired San Francisco-based Chariot, a ride-hailing company, and Israeli machine-learning developer SAIPS. And in February, the automaker announced a $1 billion investment in Argo AI, a Pittsburgh company developing artificial intelligence for self-driving cars.
Bill Ford made it clear at the press conference last week that he expects Hackett to get the automaker operating more quickly."
This is also largely my expectation after watching the meetings (and subsequent lack of share price impact) for a few years. However, the key difference this year is that the meeting is so close to the Model 3 launch. Even just "Model 3 is still on track for July" is significant news at this point.
j0hn
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EM will leave the councils he is in if trump officialy decides to cancel the climate treaty - twitter
kenliles
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MitchJi
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I agree with this decision.
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