2017 Investor Roundtable:General Discussion

[techmaven]

I believe we will soon see another press release about VW's intention to build a battery factory at some point in the 2020's and stop Tesla from gaining market share.

I am puzzled that they haven’t green lit their own factory yet:

VW mulls $11 billion battery cell plant

This article says they have, but I haven’t seen anything concrete elsewhere:

Volkswagen Is Building A Battery Factory In Germany

Certainly there would be more noise if they really are dropping $11 billion, including a manufacturing partner.

 

[TradingInvest]

I am puzzled that they haven’t green lit their own factory yet:

VW mulls $11 billion battery cell plant

All car companies now realize ICEs can't compete with EVs. How to react is the question they face. They can choose to wait and see, that would guarantee their quick bankruptcy.

There are many reasons why EVs will quickly beat ICEs. One of the reasons is autonomous driving. Adding autonomous to ICEs is very challenging. AI + electric motor have instant response. On top of that, California is likely to ban autonomous ICEs, because they generate more pollution compared with the cars parked in garage most of the time.

If I were in charge of VW, I would use that $11B to buy Tesla's shares. Then work closely with Tesla.

 

[RobStark]

I am puzzled that they haven’t green lit their own factory yet:

VW mulls $11 billion battery cell plant

This article says they have, but I haven’t seen anything concrete elsewhere:

Volkswagen Is Building A Battery Factory In Germany

Certainly there would be more noise if they really are dropping $11 billion, including a manufacturing partner.

Müller (VW CEO) told Handelsblatt ( German Business Newspaper) that while Volkswagen is investigating the entire battery production process chain as part of its plan to build 2 to 3 million all-electric cars a year and unveil 30 new models by 2025, but that building its own factory would be “nonsense”.

VW CEO denies plans for a giant electric vehicle battery factory

This was reported in January 2017.

After rumors of VW building their own Gigafactory came out in ~November 2016.

 

[winfield100]

If someone figures out how to mimic one billionth of a human brain, they will quickly figure out one millionth, then one tenth of a human brain. By that time it may take a few months to reach an AI level that's one billion times more intelligent than human. Because the AI will improve AI at lightening speed. Then the best case is that human becomes irrelevant. More likely we will be eliminated. The likely hood for this to happen is so high, stopping the progress is so difficult, it's frightening when I think about it.

As a slightly Off Topic note re AI, speed of "oopsies, that was a realy bad mistake"
I suggest you may want to read Vernor Vinge's novel from a few years back "A Fire Upon the Deep"
back to lurk mode.
(I really like the epiphany that shortz have "sold low [$189] and are buying high, [$361])

 

[dc_h]

I imagine they will need 6 billion AP2 miles. Don't know, but seems like you need the miles on the FSD platform. A demonstration could be possible, but I don't see regulatory approval before 6 billion AP 2 miles.

 

[MXWing]

All car companies now realize ICEs can't compete with EVs. How to react is the question they face. They can choose to wait and see, that would guarantee their quick bankruptcy.

There are many reasons why EVs will quickly beat ICEs. One of the reasons is autonomous driving. Adding autonomous to ICEs is very challenging. AI + electric motor have instant response. On top of that, California is likely to ban autonomous ICEs, because they generate more pollution compared with the cars parked in garage most of the time.

If I were in charge of VW, I would use that $11B to buy Tesla's shares. Then work closely with Tesla.

Yeah I would have hated to be "that person" at Toyota that liquidated their TSLA holdings at 50% present value. Still better ROI than Chanos and Einhorn I suppose.

 

[Esme Es Mejor]

I think the entire concept of a "Tesla killer" is faulty. In the incredibly unlikely event that VW (or anyone else) produces an EV that is a better value proposition than the Model 3, it will be a better value proposition than any mass market ICE vehicle. They will sell as many as they can make, but that will leave room for Tesla to sell hundreds of thousands-- or even millions-- of Model 3s. Model 3 would still be a better value proposition than any mass market ICE vehicle.

So, even in this worst case scenario (from Tesla's competitive POV), Tesla would be hugely successful, and the transition to sustainable transport would be even faster-- because Tesla wouldn't be the only one leading it.

 

[MitchJi]

I imagine they will need 6 billion AP2 miles. Don't know, but seems like you need the miles on the FSD platform. A demonstration could be possible, but I don't see regulatory approval before 6 billion AP 2 miles.

That seems pretty obvious to me.

One thing to note is that the last billion miles were achieved in the last quarter.

 

[Thumper]

I predict that Tesla will achieve FSD and accumulate enough miles to prove safety and reliability (at some future time) but legacy makers will lobby to deny regulatory approval so they can catch up.

 

[FutureTSLACEO]

Does anyone know if Tesla will live stream the Model 3 unveil on July 28th? If so, what time will the live stream start? I can't seem to find any information about this, and I would appreciate if someone let me know. Thank you! *can't wait to mark it on my calendar*

 

[Sparky]

No spoilers! Waiting until some friends get home from international trip to watch tomorrow.
Still recalling, as a teen, standing in a long line outside the theater, waiting to get into "Empire Strikes Back" and some guys drive by and scream out of the windows: "DARTH VADER IS LUKE SKYWALKER'S FATHER!!".
With therapy, I've been made almost whole again.

BTW, "Rob Stark" I believe your avatar should have a Dire Wolf's head sewn on in place of your human head... no?

 

[Alketi]

Still recalling, as a teen, standing in a long line outside the theater, waiting to get into "Empire Strikes Back" and some guys drive by and scream out of the windows: "DARTH VADER IS LUKE SKYWALKER'S FATHER!!".

WHAT!

I had a neighborhood kid follow me around on my paper route in 1983 and tell me everything that happened in Return of the Jedi. I still haven't recovered.

 

[tinm]

While we're on the subject of spelling and grammar:

Just remember:

• It's "it's" not "its" when you're trying to say "it is."
• And it's "its" not "it's" when you're trying to say "of it."

Before you click "Post Reply," read your post aloud if it contains "its" or "it's," and if you wrote "it's" then pronounce it out loud as "it is." Does it make sense? No? You probably mean "its" then.

 

[Mo City]

I imagine they will need 6 billion AP2 miles. Don't know, but seems like you need the miles on the FSD platform. A demonstration could be possible, but I don't see regulatory approval before 6 billion AP 2 miles.

6 billion AP2 will probably happen early 2019 at the very latest.

Does anyone know if Tesla will live stream the Model 3 unveil on July 28th? If so, what time will the live stream start? I can't seem to find any information about this, and I would appreciate if someone let me know. Thank you! *can't wait to mark it on my calendar*

100% guaranteed to live stream. Tesla will reveal the details a few days prior.

 

[neroden]

Regarding the share price comments, one way to look at it is, there are going to be no imminent stock offerings. Not that I am opposed to it, in fact, I love bringing in new capital to accelerate the mission.

Actually, as Warren Buffett has pointed out, the time to do stock offerings is precisely when the stock is overpriced...

(More specifically, when the return on investment of the percentage of the company you give up in the stock offering, is worth less than the incremental return on investment you can get from the cash raised...)

Given the need for expansion, maybe there will be some more stock offerings at these prices...

 

[Matias]

I think Volkswagen will bring a compelling car to market by 2020, but their challenge will be ramping up production as quickly as Tesla without Gigafactories.

VW r&d chief sees need for more battery production capacity

 

[ValueAnalyst]

Tesla had said 6 billion miles are needed before it can achieve FSD and pass it through regulators, but I mistakenly excluded AP miles that have been accumulated between October 2014 and October 2016 in my estimate, which led me to predict Tesla would not accumulate 6 billion miles until end-2018.

Tesla likely has already accumulated 2+ billion AP/EAD miles and 1+ billion FSD shadow miles, putting it on track to achieve 6 billion miles by end-2017, just in time for the demo ride from LA to NY "with no controls touched throughout the trip... even if you change the route dynamically."

I expect CA and NY to be the first states to pass the necessary laws for Tesla Network to launch with Level 4 autonomy in geofenced metropoles by end-2018. I expect FSD regulations to be in place in majority of states, and a handful of other countries, by end-2019. That's two years after the LA to NY demo ride, and two-and-a-half years after Elon received a bipartisan standing ovation from the US governors.

It's worth repeating that I do not expect revenue from Tesla Network to comprise more than 5% of Tesla's companywide revenue until 4Q22 due to the S-shaped market adoption rate of new tech. Having said that, however, no other player is on track to achieve FSD before 2021; therefore, I expect FSD to be a competitive advantage for Tesla and favorably affect its unit sales and margins for 2-3 years.

 

[ValueAnalyst]

Publicly available article that includes quarterly net income projections:

Why Is Tesla Not In The S&P 500? - Tesla Motors (NASDAQ:TSLA) | Seeking Alpha

Feedback/questions/comments/doubts/grudges welcome.

 

[Reciprocity]

Actually, as Warren Buffett has pointed out, the time to do stock offerings is precisely when the stock is overpriced...

(More specifically, when the return on investment of the percentage of the company you give up in the stock offering, is worth less than the incremental return on investment you can get from the cash raised...)

Given the need for expansion, maybe there will be some more stock offerings at these prices...

I believe the op point was that you wouldn't say it was over priced then do an offer, you would do the offer without doing dumb stuff to lower the valuation. You both made the same point just from different positions.

 

[Bobfitz1]

VW has vaporware right now. It means nothing and is simply an attempt to steal Tesla's thunder. Any car company can release any statement claiming they are developing an electric car that is better than the Model 3 and cheaper. Words are cheap. It means nothing until prototypes exist.

I don't know that Tesla will ever lower prices. They might, but I don't see a definite reason they would.

Exactly. A company like VW, that can permit/encourage a massive emissions fraud, is to be expected to pull a feature/cost prediction worth nothing out of their a**. VA should not use such a bogus marketing prediction as support to back into a conclusion that in a few more years Model 3 prices will be lowered substantially. We all know Tesla's mission. As long as other car companies are unable to ramp their EV sales up as fast as Tesla, advancing the mission requires that Tesla maximize the profits it can generate from car sales. These profits then will mostly be plowed back into building 3rd and 4th rounds of GigaFactories to push Tesla's production into the millions per year.
Come 2025 and beyond, if other manufacturers still can't get EV sales to 50% or more of new cars, Elon will build 20 or 30 GFs to support building tens of millions of EVs. That is entirely consistent with his way of thinking. SpaceX is fairly far along in developing engines, fuel tanks, etc. for BFR, before Falcon 9 Heavy has even had its first test launch!