2017 Investor Roundtable:General Discussion

[sundaymorning]

From what I can remember Elon gave no such preidiction this far out when X was ramping. In regards to recent M3 news, this shows a huge sign of confidence that I haven't seen since the early days of MS ramp, an indication that Tesla's manufacturing gamesmenship is strong.

 

[Reciprocity]

That is not how 90% plus of potential and actual customers will look at it.

The bottom line is the monthly payment. In most markets it will compete with those entry level luxury vehicles and particularly the PHEV versions.

So what your saying is that those models are going to zero in the next 18 months or more realistically every single small luxury car will have there sales cut in half while non lux brands like Camry will continue on without even noticing the release of the 3? Not buying it. The car has extremely broad appeal and people will make the effort to do the math to justify the purchase. Model 3 will also eventually push a lot of people over the solar edge as well. Those who could not justify the cost/savings will have no problems justifying it when gas is replaced be electricity.

Edit: if you are right about the payment, an easy solution would be 7 year loan or 5 year lease. Though I don't think they would do that or need to.

 

[myusername]

BYD 2016 revenue was $15.3B

Mitsubishi Motors $17.9B.

Suzuki Motors $28.3B

Mazda $29.5B

Subaru $29.8B

The World’s Biggest Public Companies

what is your point here? Market caps:

Tesla: $60B -- revs lt $10B

Mitsubishi: $9B

Mazda: $8.1B

Suzuki: $19.9B

Subaru: $27.3B

 

[ValueAnalyst]

Tesla Model 3: Elon Musk updates his guidance on production ramp up and deliveries

From the article: "He still expects to hit the previously guided 5,000 units per week mark by the end of the year, but in December instead of September as originally planned with the parts orders schedule:"

@FredLambert - Elon NEVER guided for 5,000 units per week in September. The previous guidance was "[Tesla ordered] 1,000 parts for July, 2,000 in August, 4,000 in September" and "reach 5,000 per week production rate some time in 2017." Elon also made it abundantly clear that these were part orders and that "the parts need to arrive, and they need to be turned into a car and the car needs to be delivered to customers.”

20,000 Model 3's produced in December is in-line with previous guidance.

Model 3 will be ramping up at an exponential growth rate of +100% month-over-month throughout 4Q17. What does that mean for 1Q18/2Q18?

 

[RobStark]

So what your saying is that those models are going to zero in the next 18 months or more realistically every single small luxury car will have there sales cut in half while non lux brands like Camry will continue on without even noticing the release of the 3?

Every new car competes with every other new car on the market as well CPO cars to some extent.

A 2018 Camry XSE V6 is projected to start at $35k.

Tesla Model 3 will hit not only entry level luxury sedans hard but entry level luxury coupes and CUVs too. Simply because people really want sub $50k Tesla and a Model 3 coupe nor a Model Y exist. That is the main but not only competition.

Far less sales will be taken from base Prius,Corolla LE, and Camry I4 LE. Any car can now be purchased on an 84 month loan. But Model 3 will take some from each.

American Tesla observers tend to project Tesla global sales vs US sales.

But looking at US.

New-Car Transaction Prices Grow Less Than 2 Percent Year-Over-Year In June 2017, According To Kelley Blue Book

IRVINE, Calif., July 3, 2017 /PRNewswire/ -- The analysts at Kelley Blue Book www.kbb.com today reported the estimated average transaction price (ATP) for light vehicles in the United States was $34,442 in June 2017. New-car prices have increased by $511 (up 1.5 percent) from June 2016, while remaining relatively flat (down 0.1 percent) from last month

 

[Buddyroe]

Any news on Q2 deliveries yet? Though we all know that the M3 news will far overshadow the delivery news (whether good or bad), I'm starting to get nervous that Q2 deliveries were not very good and the timing of the M3 announcement was not an accident.

 

[DragonWatch]

Oh yea of little faith

My early numbers show up $8 as of late riser time

Elon Musk: Tesla to deliver first Model 3 cars this month

Slow on the up tic ~ but you are getting your M3s

Now is the time to grin and bear it

 

[DragonWatch]

Thank god it's Friday

 

[tinm]

Also wondering where the Q2 numbers are and am expecting lackluster results. Especially given yesterday's communications shenanigans.

 

[sundaymorning]

Delivery numbers won't matter, it's going to pop. The train is leaving very soon. Say your goodbyes.

 

[Italia81]

Ok, 75k model 3 deliveries this year, 500k total vehicle deliveries next year, and no need for outside capital. I'll fully admit that I was too bearish if that happens. We'll start to know soon here in a few months. Any dissent to the bull case is met with a lot sceptisim here so the confidence here seems pretty high. I'll Long this stock either way in a few months because either it gets cheaper with a miss or they execute to perfection and a lot more will be on the table.

VA, are you still thinking 75k M3 deliveries this year or have you updated the your model?

 

[geneclean55]

Current market action ($368.40 @ 92.97k volume). Reminiscent of mid last week, when a strong pre-market rally slowly diminished as we neared market open. Is this the strongest pop the market can muster after such news?

I see 368.5.
Its basically been 368-369 for over an hour. TSLA pre-market is a strange beast, and not particularly reliable once regular hours trading starts.
In terms of popping though it reached 373

 

[brian45011]

In the grand scope of things nothing short term matters and outer years is what matters..

Car of the Year type awards matter. The X was too late for 2016 consideration; the M3 appears to be in production in sufficient time for evaluation.

Also, it looks like they will deliver the 200,000 th credit eligible vehicle in early 1Q18 rather than late 4Q17.

 

[ValueAnalyst]

VA, are you still thinking 75k M3 deliveries this year or have you updated the your model?

I updated the unit projection for 2H17 and kept margin projection the same.

I was too optimistic for 3Q17 and slightly optimistic for 4Q17. I underestimated the time it takes to take delivery of parts ordered, assemble them into cars, and deliver to customers.

Having said that, however, the +100% month-over-month exponential growth rate throughout 4Q17 gives me more confidence for my 2018 projections, which is really what matters to the future of Model 3, and hence, the stock price.

The following table presents my Model 3 expectation for the next six quarters. Note that I have my EAD/FSD option uptake projection in a separate section, hence the Model 3 ASP assumption of $40k.

 

[winfield100]

So buy the dip tomorrow?

good idea, is tomorrow 6/30? premarket looks a teensy tiny bit up

Part of my investment research involves looking at the logic of the people on the opposite side of my bets.
The worse the logic of the smartest person on the other side, the better I like my bets.
I have yet to find a person on the other side that seemed really smart so I read the SA articles as a proxy of what goes through the head of the people taking my bets.
This gem is from last year: Tesla's Model 3 Mess Has Become Much Messier - Tesla Motors (NASDAQ:TSLA) | Seeking Alpha

"
I am 99.98% confident the cheapest Model 3 will cost significantly more than $35,000. And I'm equally confident no production versions of the Model 3 will be available in 2018

I asked Montana Skeptic if he will make a revision of his "prophecy" with a side note the date of article was 11/30/2016, Robin Hood conference and Mark BSpiegel's power point and the 106% gain in TSLA since then. with possibly a 'soupcon' of a virtual knife to the kidney about a 95% confidence gain of 5 figures in my portfolio today!! (a fair fight is one you win)
retirement iz fun and i haz cheezburgerz and bbq ribs to nosh on!

 

[Reciprocity]

The FUDsters can always go back to the meme that it does not matter how many cars Tesla makes, they sell them at a loss and they will implode once fed tax breaks and zev credits go away. The more FUD the better really.

 

[myusername]

Delivery numbers won't matter, it's going to pop. The train is leaving very soon. Say your goodbyes.

so what does matter?... x/s delivery numbers don't matter... revenue misses don't matter... 2017 expected production of M3 doesn't matter... if they produce less than 20k M3 in 2017 and 100k in 2018... does that matter?... you'll probably call me a troll for suggesting 100k M3 in 2018... right?... just like I was called a troll for saying 20k or less in 2017 last year at this time...

so what matters?... if it's 100k M3... no profits... flat/declining MX/MS sales... will it matter?

 

[jbcarioca]

I updated the unit projection for 2H17 and kept margin projection the same.

I was too optimistic for 3Q17 and slightly optimistic for 4Q17. I underestimated the time it takes to take delivery of parts ordered, assemble them into cars, and deliver to customers.

Having said that, however, the +100% month-over-month exponential growth rate throughout 4Q17 gives me more confidence for my 2018 projections, which is really what matters to the future of Model 3, and hence, the stock price.

The following table presents my Model 3 expectation for the next six quarters. Note that I have my EAD/FSD option uptake projection in a separate section, hence the Model 3 ASP assumption of $40k.

View attachment 233867

Have you accounted for the lack of a complete assembly line robotic installation to date? It's very possible that we'll see the rapid ramp a few quarters later than presently imagined.

 

[Buddyroe]

Personally, I think Tesla will release the delivery number at about 9:45 or 10am ET. This is when the stock will be in the midst of its biggest pop from the M3 news and best positioned to withstand bad news about the deliveries.

OR - Musk could be doing this whole thing just to make it appear the deliveries are bad (because it looks quite obvious they will be), and then get another surge in the stock price from the deliveries numbers. Had they announced good delivery numbers over the weekend or before market open this morning, then the deliveries news wouldn't have added much to the M3 news (in terms of stock price). But, if we're ALL expecting bad deliveries, then a good number will shock us all and seen even more as a positive (than a weekend announcement would have).

So, I guess either way, we will get the delivery news between 9:45 and 10am ET.

 

[ValueAnalyst]

Have you accounted for the lack of a complete assembly line robotic installation to date? It's very possible that we'll see the rapid ramp a few quarters later than presently imagined.

I'm slowing down the Model 3 ramp rate from Elon's ~100% m/m in 4Q17 to ~27% in 1Q18 to ~10% in 2Q18 to ~8% in 3Q18 to ~5% in 4Q18.

Looking at how the model is flowing through, I think the 1Q18/4Q17 m/m matters slightly more than other 2018 quarters, and the ~27% I assumed is in-line with both Model S and Model X third quarter ramp.

What would you say is the likely path of ramp? Do you expect the "20,000 per month" to persist for some time?