Reciprocity
Active Member
Stocks go up and down.. duh. I am still waiting for your lines that extend out 30 years.
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Tesla's Supercharger Team was recently laid off. We discuss what this means for the company on today's TMC Podcast streaming live at 1PM PDT. You can watch on X or on YouTube where you can participate in the live chat.
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Stocks go up and down.. duh. I am still waiting for your lines that extend out 30 years.
Waiting4M3
Active Member
Apple has expertise in Batteries, BMS, Processing power, UI/Infotainment systems for sure, not sure about inverters and motors. It could also make sense that they would build a factory in Wisconsin with Foxconn to supply the screen, and another plant nearby in Michigan to build a related product that the screen go into, like Tesla with the GGF and Fremont car factory. There is no reason that Apple can only build 1 factory at a time, I'm glad to see them actually getting off that pile of cash they're sitting on, and do something with it, for the sake of US economy.
ValueAnalyst
Closed
I think we may get some commentary around Model 3 margins and something like "we're on track to achieve 20,000 in December would also help. I also want to hear more color on TE ramp (solar roof and powerpack). Recommitment to Model S/X deliveries in 2H > 1H would also be meaningful. I don't really expect to hear much on Semi or subsequent Gigafactories since the event is just a month away. I don't know if they'll comment on Kurt.
I typed up a fairly detailed article on what I'll be watching tonight but I have zero visibility into when or even if my articles will get published on the publicly available side of SA.
Also in the fog here, BUT it seems doubtful any M3 margin details will emerge today.
However, some "color" on TE, possible ramping, possible reveal of N+ GF and other parts of the Tesla Evolution may be appearing. I hope.
Most manufacturers do charge more for more complex paints, especially ones that have more complex painting processes. The pigments themselves are more expensive for Reds, especially MCR-like Reds patly because they are inherently less stable than some other colors, but today's highly complex color structures and environmental constraints cause anything other than pure basic blacks or whites to be more expensive. Pearl white, as in M3 still is very expensive.
The previous paragraph is true but probably there is no material difference in actual applied cost of different automotive color types today. people will pay more to have a specific color they want, though, so manufacturers charge for that. One or more colors are usually available for no surcharge which does reduce the base MSRP. Fundamentally, manufacturers will charge more if we are willing to pay more. It has been thus for all time. Even house paints cost more for added pigments and on occasion somebody argues that the differences are cost-based. Theoretically such arguments can be made, but they really are not the primary cause for higher prices of these colors.
erthquake
Active Member
I was watching CNN's climate town hall with Al Gore last night. Describing the change happening with solar and other sustainable energy technologies, Gore quoted economist Rudi Dornbusch:
This thinking by ICE companies is the essence of why they're mostly doomed to be shells of their former selves, barring extraordinary government intervention to save them.
This thinking by ICE companies is the essence of why they're mostly doomed to be shells of their former selves, barring extraordinary government intervention to save them.
It's because everyone assumes and thinks linearly. Whereas technologies improve exponentially. Autopilot will almost certainly be another example of this.
I saw a talk by Ray Kurzweil who described the progress sequencing the Human Genome. When it took 7 years to sequence 1%, everyone thought "oh no, it'll take another hundred years", where Kurzweil said "Good. We're almost done." Because 1% is only seven doublings from 100%. And, in fact, it was completed 8 years later.
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larmor
Active Member
May be insight on M3 order option selection-- since options are all bundled- battery, premium, EAP/FSD which are significant relative to the base price...
MitchJi
Trying to learn kindness, patience & forgiveness
IMO two things that would help would be (if true) positive current news about the M3 production ramp and MS reservations.
Why don't you post your free articles here, either instead of or in addition to at stinking alpha?
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ValueAnalyst
Closed
I think an upward production revision would certainly be helpful, but I doubt management would provide that ahead of a quarter. Maybe next quarter. I agree with management that reservation number is meaningless. Maybe some positive commentary around actual orders being ahead of expectations would be helpful but that's another topic for next quarter.
Moderators won't allow me to post my links here, SeekingAlpha wouldn't allow me to post the body of the article here. For the record, SeekingAlpha is not monolithic. Tesla certainly gets a lot of FUD from a team of contributors, but SA is generally a useful platform on which investors can exchange ideas and seek feedback; you just have to be careful about who you follow.
My article just got published btw.
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MitchJi
Trying to learn kindness, patience & forgiveness
What you are missing is two things:
1. Just because something is obvious or makes sense doesn't mean that it's correct.
2. In this particular case I'd add that that doesn't seem obvious, or even a reasonable conclusion to many of us.
Absolutely 100% false. Every equity plan that touches an NEO (named executive officer, which includes the CEO) is fully disclosed in the proxy and every equity plan in existence for the company (including expired plans, unless no shares remain in the plan), even the ESPP which is a broad-based plan, must be quantified in the 10-Q. I draft these things for a living. No wiggle room in the rules.
It's better to ask questions of the community - or me directly if you're aware that I know this stuff - rather than making a post insinuating that something is/could be hidden in the SEC filings. Might be an honest mistake but it's something that could make people think you are trying to sow FUD.
Heum? And what about option plans for R&D employees that aren't named executive officers? They will add to R&D GAAP.
ValueAnalyst
Closed
I agree with your comment 100%. Thank you for following up.
Also, since you seem to have at least a few years of practical accounting experience, could you please enlighten us on the following:
I spent some time in accounting, but that was years ago and the rules may have changed. Would you expect Tesla's R&D expense to show a step-change increase as revenue ramps up (i.e. because of GAAP), or would the increase be more correlated with how many engineers Tesla hires as part of an ongoing usual ramp in R&D expense? In other words, just like depreciation will be somewhat correlated with cars produced as Tesla uses units of production method of depreciation (i.e. depreciation will show a step-change up in 1H18), is R&D expense also correlated at all with number of cars produced solely because of GAAP (i.e. are any R&D costs capitalized for revenue matching)?
I suspect the answer is no, but I wanted to confirm.
Thank you in advance.
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ValueAnalyst
Closed
My understanding of the Form 10-Q is that 3/4th of the employee equity plan milestones have already been deemed achieved or likely to be achieved, so the company has been recognizing that expense. The only milestone left there is the 30% gross margin one, which is unlikely for the foreseeable future.
Yes, of course options can be granted to any employee in the company (and directors). You were suggesting that there may be other plans that aren't discussed in the Q and I was assuring you that is not the case.
Here's a brief summary of how US plans work if anyone cares.
- Company drafts an equity plan and asks shareholders for approval in the proxy. In the approval is the maximum number of shares that can be issued under the plan, forever (until they request approval for more shares).
- If the measure passes then they file an S-8 registering the shares with the SEC. All the share data is there, plus a copy of the plan.
- Company is then free to issue shares as it sees fit, usually approved by the Board or the Compensation Committee of the Board. Shares going to NEOs and directors are quantified in excruciating detail in the proxy each year, including grants, potential vestings if targets are hit, old grants, vestings/option exercises during the year, etc., and the values of each. Shares going to non-NEOs are quantified in the 10-Q - you must disclose exactly how many shares remain in the plan after all grants through the reporting period. Thus, there's nothing hidden. You simply subtract shares remaining from shares authorized and there's your number. It's true that the timing of these grants from the remaining pool are in question. But you know what is/has been granted and the maximum allowable.
- As the share pool declines the Company will go back to shareholders with a request for more shares. It's public and you vote on it.
As an aside, it's uncommon for regular (non-VP level) employees to get equity awards with company-wide performance metric conditions. They are usually time-based awards that vest simply on the passage of time. They are retention tools and designed to reward outstanding individual effort. The entire share pool granted to non-NEOs is often dwarfed by the grant to NEOs, which is widely disclosed in the proxy.
Happy to answer any other questions people have.
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