2017 Investor Roundtable:General Discussion

[kenliles]

A look at Tesla Gigafactory 1 from space over the last year

 

[MitchJi]

Careful readers, like @EinSV below, noted that I didn't compare both project, but rather the retoric used by the wall guy and Elon in that particular tweet. For the record : I have no real opinion on Hyperloop and Boring either way. See below why.

There is literally zero information at all available to the public about this proposal. Not about where the entry and exit points are, not the exact trajectory, not how deep it will be, not who (or if any) independent verification has been done on the engineering wrt to safety for surface side construction, not if the project is seeking public money, etc.. at all. Nothing at all. Yet, Elon is touting one supposed feature no one could be against (29 minutes DC-NYC). It's a text book example of how to make any real debate in the public opinion impossible : keep information that would allow us to form an independent opinion on the merits and dangers secret but at the same time call for big supposed advantages that appeal to emotions. For another example of this : Brexit where none of the brexiteers plans were laid out but the headline 600 million pound to the NHS every week was widely distributed. What happened was that the public at large wasn't debating the merits of the real proposals.

No opinion because there isn't enough information to reach a conclusion, but that's enough for you to jump to a negative conclusion?!

Everything Elon does provides a valid reason to leap to negative conclusions about his motivations?

Is that valid for you personally, everything that you do has some underlying negative agenda?

 

[tander]

That is bizarre. There are dozens, if not hundreds, of jurisdictions whose written approval (and compliance with their specifications) would be required if the tube(s) were solely under publicly controlled right-of-ways. Passing under private property would be several orders of magnitude more complex. In the US, conventional (somewhat simplistic) real property law is that a landowner's sub-surface rights extend from the surface to the "core of the earth." http://scholarlycommons.pacific.edu/cgi/viewcontent.cgi?article=1141&context=facultyarticles

He's channeling someone else's gratuitous tweets who types before engaging gray matter. Focus on the M3 ramp is essential!

Written approval to do something underground seems like it's probably going to be a lot easier than having to move homes highway or mountains etc. above ground most of the time.

Interestingly, yesterday's tweet about the NY/DC hyperloop was a major shift in Musk's tone from the flippant tweets of the past. Instead, it was classic Musk evangelical earnestness and hyper optimism that we are so used to seeing from him for all things Tesla related.

Which now makes me wonder, was the flippancy of Musk's past tweets, including the ironic name Boring Company, really reflective of Musk's semi-serious intentions, or a very calculated way for Musk to gradually disclose his very serious intentions?

What if Musk has been working seriously on this project for awhile and has worked out enough of the engineering and financial hurdles to make this a very serious endeavor. But before he's ready to seriously announce it, he needs to dig some tunnels and have some preliminary discusssions with govt officials, and he knows he can't possibly do that in complete stealth. But he also knows that if he discloses such ambitious intentions seriously at such an early stage, he risks the kind of ridicule he had to endure in the early days of Tesla, multiplied many times over.

So he plays it very lighthearted, ambiguous,and it all seems off the cuff and the distracted plaything of a visionary. Until he has enough pieces in place to shift to serious evangelizing.

Perhaps all his initial cheekiness has been very calculatingly clever introductory PR?

Those are good insights. I think part of the downplaying of the boring stuff is anything that appears as a distraction from Tesla tends to upset shareholders, even if it will probably end up helping them in the long term.

That is an absolutely awesome read. Love this line:

"At seven stories tall, it is the largest stamping press in North America; it took 50 trucks and 30 rail cars to transport it from Detroit to Fremont. Tesla bought the $50 million machine for $6 million in an example of what vice president of manufacturing Gilbert Passin calls "happily scavenging" from struggling companies."

Also very interesting and if you look at the picture associated with the text you can see maybe why they are building that giant tower:

"To maximise efficiency, the stamping centre produces a week's worth of each part before retooling to make another piece. These side-bodies will remain in storage before being brought to the factory's body centre, where they will be used in the assembly of the unibody chassis."

The stamping press is most efficient when you can make crap load of one part and store them. But storage space is hard to find in Fremont. They will probably stamp enough of an individual part for 20,000 model 3s at a time and store them before changing the tool to stamp 20k more of the next part. Now the tower of doom makes sense as you would need a fast and efficient way to get parts in and out and that system seemed like it could be fully automated. The other thing I am noticing that I knew but never thought about. We where looking at palatalizing robots at my previous company and I was shocked because you need 25' of clearance around them to be safe. Robots dont get tired and dont need breaks but they take up a lot more room then humans. Usually space is cheaper then humans, but they are challenged in Fremont. This is another reason to get as many of the parts out of the main factory and into the pallet tower and just pull them out precisely when you need them. Pretty amazing stuff.

I feel like factory and stamping press get so little credit. When they bought that stuff that's when I realized they weren't just looking to start a cool company and sell it. And not to join the Musk fan club but I think it's one of the big differentiators between him and other people in that tax bracket, when it comes to business he still a huge bargain shopper, and they got some really good deals.

 

[MitchJi]

Falcon Heavy prepares for debut flight as Musk urges caution on expectations | NASASpaceFlight.com


With all of these elements in consideration, Mr. Musk is urging caution regarding public expectation for Falcon Heavy’s first flight, saying that there is a “real good chance that the first vehicle [won’t] make it to orbit. So I want to make sure to set expectations accordingly.”

Even more telling was how Musk continued on this point, stating that he hoped Falcon Heavy makes it far enough away from LC-39A before failing so the pad will escape significant damage.

“I hope it makes it far enough away from the pad that it’s not going to cause damage. I would consider that a win, honestly,” said Mr. Musk.

 

[ValueAnalyst]

I have never had problems on curvy roads, so I can't really speak to it. I think it has become smoother and maybe people didn't feel as comfortable until recently. It's not easy to replace a product like mobileye, which was recently acquired by Intel for $15B. This shows you the value of what Tesla has recreated in just 9 months. What some call disappointing, I call extremely impressive. To put this into context, Tesla has two good driver assist systems and no one else has one that's nearly as good.

This is an extremely important and insightful point. I hadn't thought about it that way, but it makes perfect sense.

 

[ValueAnalyst]

That is bizarre. There are dozens, if not hundreds, of jurisdictions whose written approval (and compliance with their specifications) would be required if the tube(s) were solely under publicly controlled right-of-ways. Passing under private property would be several orders of magnitude more complex. In the US, conventional (somewhat simplistic) real property law is that a landowner's sub-surface rights extend from the surface to the "core of the earth." http://scholarlycommons.pacific.edu/cgi/viewcontent.cgi?article=1141&context=facultyarticles

He's channeling someone else's gratuitous tweets who types before engaging gray matter. Focus on the M3 ramp is essential!

This is exactly why he tweeted it.

 

[ValueAnalyst]

The bigger point too, is that once you get to significantly safer than a human, the question has to be raised is should it be mandated to be put in every car where it could save thousands of lives a year? I bet Tesla might even give the safety part of it away for free like Volvo gave away 3 point seat belts.

Tesla already announced that the safety part will be included in the $35k base model. Watch the reveal again.

 

[GoTslaGo]

Speaking of safety:

Model X in fatal wrong way driver crash today in Phoenix?

Apparently the Model X was driving in the correct direction (based on the reporter--have to watch the video). The wrong way driver (in a Ford Focus?) lost his/her life. The other driver (presumably the Model X driver) has been hospitalized.

 

[tander]

Tesla already announced that the safety part will be included in the $35k base model. Watch the reveal again.

I meant put in every car made by anyone not just by Tesla.

 

[howardoark]

Tunnel DC to NYC

I hate to ruin my reputation as a TSLA skeptic, but the tunnel idea isn't bad. If it were a car or train tunnel, it would be non-starter. But my understanding is he wants to evacuate the tunnel, place the cars on mag lev and accelerate them at about 0.06g (so you'd be moving at 1200 mph at the halfway point). You don't need a large diameter tunnel for that (but you do need 2 of them). Two six-foot diameter tunnels would require moving an amount of earth equivalent to the volume of the great pyramid of Giza (the ancient Egyptians didn't have heavy equipment). I don't think local jurisdictions would be a problem (do it from 200 feet below ground and follow I95 and there won't be any legal or engineering issues (other than the obvious ones). It would still be insanely expensive - looking at concrete water pipes of that size, you're probably talking $4 billion (plus another few billion for stations) and a lot of money in superconducting cables. I doubt it could be done for less than $20 billion (less than 20% of the cost of the Apollo program in today's dollars).

If TSLA does work out the way the majority here feels it will, he could self fund it. And if not, he does have a way of sweet talking politicians out of your and my tax dollars.

 

[kenliles]

Re: VW/Audi newly broadcast EV commitment
Guess those new batteries are for glow plugs

Audi to update 850,000 cars as diesel recalls widen
"<
Audi, the luxury brand of the Volkswagen Group, announced the voluntary retrofitting program on Friday. The company said in a statement that it "aims to maintain the future viability of diesel engines" and believes the program "will counteract possible bans on vehicles with diesel engines."
>"

 

[Alketi]

Re: VW/Audi newly broadcast EV commitment
Guess those new batteries are for glow plugs

Audi to update 850,000 cars as diesel recalls widen
"<
Audi, the luxury brand of the Volkswagen Group, announced the voluntary retrofitting program on Friday. The company said in a statement that it "aims to maintain the future viability of diesel engines" and believes the program "will counteract possible bans on vehicles with diesel engines."
>"

Interesting isn't it -- how the world leaders perform software patches. Via an 850,000 unit recall to your local dealer..

 

[drinkerofkoolaid]

The market can only stay rigged for so long. At some point, the critical extremes are hit, and everything stops working. I love Tesla, but Trump, the FED, GS, or some large MM are toying with the entire market, which will be very bad for all stocks, when convergence occurs.

Surprised no-one commented on my prior post. I'm curious what everyone thinks about this.

Another Rigged Market: Scientific Study Finds Systemic VIX Auction Manipulation | Zero Hedge

 

[Krugerrand]

I disapprove of wasting money on stupid *sugar* in a way which prevents people from spending money on things which would actually help.

It's not your money, so what do you care?

If you think there's a better way (as you clearly do), then I invite you to get out there and show us (and Elon).

 

[Oil4AsphaultOnly]

Tunnel DC to NYC

I hate to ruin my reputation as a TSLA skeptic, but the tunnel idea isn't bad. If it were a car or train tunnel, it would be non-starter. But my understanding is he wants to evacuate the tunnel, place the cars on mag lev and accelerate them at about 0.06g (so you'd be moving at 1200 mph at the halfway point). You don't need a large diameter tunnel for that (but you do need 2 of them). Two six-foot diameter tunnels would require moving an amount of earth equivalent to the volume of the great pyramid of Giza (the ancient Egyptians didn't have heavy equipment). I don't think local jurisdictions would be a problem (do it from 200 feet below ground and follow I95 and there won't be any legal or engineering issues (other than the obvious ones). It would still be insanely expensive - looking at concrete water pipes of that size, you're probably talking $4 billion (plus another few billion for stations) and a lot of money in superconducting cables. I doubt it could be done for less than $20 billion (less than 20% of the cost of the Apollo program in today's dollars).

If TSLA does work out the way the majority here feels it will, he could self fund it. And if not, he does have a way of sweet talking politicians out of your and my tax dollars.

This isn't a Tesla project. It doesn't impact Tesla one way or another until those maglev sleds are built. So if the project doesn't get local approval, that's not a risk factor for TSLA.

 

[drinkerofkoolaid]

Beginning to wonder if it's a conincidence that Trump has Tweeted lies or carefully tailored posts every time the market looks like it might end down. The broad market and VIX should have ended down 1%+ based on fundamentals, being way overbought and the many impeachment worthy events Trump did today and yesterday. Market ended Red and VIX at historic low? Someone is playing dangerous games that won't end well. A wise CEO allows the market to do its own thing, and doesn't try to stop normal ebbs and flows. Number of times Obama Tweeted about the stock market? Basically zero, except when he commented on its movement over his 8 years.

Trump wouldn't be Tweeting about stock market regularly if he didn't know who is doing the manipulating.

 

[schonelucht]

No opinion because there isn't enough information to reach a conclusion, but that's enough for you to jump to a negative conclusion?!

Again, I have no opinion on the project, I have an opinion on how Elon presents it.

 

[ValueAnalyst]

No. Bluntly, it couldn't.

Those of us who know a little bit about the economics of tunnels and railroads can tell you that, unless every ticket is subsidized by more than Amtrak is, the ticket price cannot be comparable to Amtrak unless they substantially redesign it so that the Hyperloop trains carry more people, and that's assuming someone else pays for the capital construction.

If they have to recover the capital costs of the tunnel (as opposed to simply having those paid for by government or something) then it's completely impossible to have comparable price to running on the surface route built 100 years ago.

Nothing wrong with tunnels, but they don't seem to understand the basics of transportation economics. The most important point when it comes to cost-effectiveness is to put a hell of a lot of people in each vehicle. When I see a revised hyperloop design which holds 1200 people per train, then I'll know they're starting to get serious.

This post completely ignores the fact that there are tens of thousands of people who'd pay A LOT OF MONEY for a 29 min DC to NY ride.

They do it today. It's called Amtrak Acela. And it takes 3 hours. $150+ ticket. One way. They do it every day.

Imagine what these "business" people would pay for 2.5 hours less time. $300 per ticket one way? $500? Possible.

 

[GregRF]

Tunnel DC to NYC

I hate to ruin my reputation as a TSLA skeptic, but the tunnel idea isn't bad. If it were a car or train tunnel, it would be non-starter. But my understanding is he wants to evacuate the tunnel, place the cars on mag lev and accelerate them at about 0.06g (so you'd be moving at 1200 mph at the halfway point). You don't need a large diameter tunnel for that (but you do need 2 of them). Two six-foot diameter tunnels would require moving an amount of earth equivalent to the volume of the great pyramid of Giza (the ancient Egyptians didn't have heavy equipment). I don't think local jurisdictions would be a problem (do it from 200 feet below ground and follow I95 and there won't be any legal or engineering issues (other than the obvious ones). It would still be insanely expensive - looking at concrete water pipes of that size, you're probably talking $4 billion (plus another few billion for stations) and a lot of money in superconducting cables. I doubt it could be done for less than $20 billion (less than 20% of the cost of the Apollo program in today's dollars).

If TSLA does work out the way the majority here feels it will, he could self fund it. And if not, he does have a way of sweet talking politicians out of your and my tax dollars.

Not maglev, no superconducting cables. You may want to read up on the hyperloop white paper.

 

[RobStark]