2017 Investor Roundtable: TSLA Market Action

[vgrinshpun]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term

In the long term, Tesla’s product development team should be able to develop factories that enable Tesla “to leverage development capabilities and improve manufacturing efficiency. A focus on design for manufacturability should allow the company to produce cars in a faster and more efficient way over time,” Kallo said.

Specifically, management noted that it is on track to produce about 250,000 vehicles by the end of 2017, and are expecting positive gross margins on the Model 3 in Q4. Management also highlighted margins could ramp up faster with the Model S or X.

Additionally, “Management indicated the company would continue to improve energy density, which should contribute to a smaller battery pack and increased range,” Kallo stated

I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

 

[Jonathan Hewitt]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term

so like 100,000 S/X and 150,000 Model 3? with positive margins by end of year? Holy Moly!!!

 

[austinEV]

250k.... uh... If they "fail" and do half that I would be very happy.

 

[WarpedOne]

Someone is confused.

 

[Jonathan Hewitt]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term







I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

Is it possible they meant "run rate of 250K per year" for Model 3 and someone misunderstood? That has happened before...

 

[vgrinshpun]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term

I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

Something is fishy about the 150K M3 in 2017: even if they hit production of 5K per week in August, it is only 100K in 2017. It would be impossible to deliver 150K M3 with 5K/week production. I am really puzzled by this. Ben Kallo does not have record of outlandish claims. In fact he is very sensibly bullish on Tesla...

 

[D-egg-O]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term







I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

Could this be referencing total aggregate production to date?

 

[erthquake]

More information from the today's Ben Kallo's note: Superior Manufacturing, Unique Automation Gives Tesla A Competitive Advantage For The Long Term







I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

Me too. At first I wondered whether they meant 250K produced all time. However, Tesla had sold about 183K by the end of 2016, and no way they are only producing 67K this year.

 

[schonelucht]

"Furthermore, TSLA management suggests the company can produce battery pack at roughly half the cost of competitors."

This is incredibly important. This is key.

With both Nissan-Renault and GM being below $200 on pack replacement prices, is Tesla really saying that their battery pack production price is below $100/kWh? That's pretty incredible.

 

[D-egg-O]

Me too. At first I wondered whether they meant 250K produced all time. However, Tesla had sold about 183K by the end of 2016, and no way they are only producing 67K this year.

I agree, 67K produced for this year doesn't make sense either. Maybe it's a typo and he meant 150K. I'd be extremely happy with that.

 

[D-egg-O]

With both Nissan-Renault and GM being below $200 on pack replacement prices, is Tesla really saying that their battery pack production price is below $100/kWh? That's pretty incredible.

We have to remember that $200/kWh replacement for GM includes the markup from LG Chem who actually makes the pack. I'm not sure if Nissan-Renault design and assemble their own battery packs. My guess is no.

 

[DurandalAI]

250k.... uh... If they "fail" and do half that I would be very happy.

Even as an Elon Musk fanboy, I can't even fathom them hitting 250,000 vehicles in 2017. That also doesn't fall in line with what we've been told the parts order numbers that they are telling suppliers. If 250,000 vehicles ship in 2017, you can make that 250,001 as I'll be able to afford to buy a Model S in 2017 instead of waiting for my Model 3 in 2018!

 

[FluxCap]

We have to get the source document (Kallo's note) on this Benzinga article - the "journalists" that work at Benzinga are inexperienced and low-paid kids that are prone to making many mistakes, and I suspect that is the case here. It just does not compute.

 

[schonelucht]

I am very skeptical on 250K vehicles produced by the end of 2017, but if I am wrong with this sentiment, the SP will go up faster than Falcon Heavy with no payload. I am dumb founded on how they can plan for more than 100K of M3 in 2017. I will be very happy if they can hit 20K

250k is simply unbelievable. It means producing Model 3's at a 5k weekly run rate from the first day of July on top off producing 75k S/X in the second half of the year. On top of reiterating an outperform with a price target lower than current stock price makes me seriously question the quality of that note.

 

[MitchJi]

Something is fishy about the 150K M3 in 2017: even if they hit production of 5K per week in August, it is only 100K in 2017. It would be impossible to deliver 150K M3 with 5K/week production. I am really puzzled by this. Ben Kallo does the not have record of outlandish claims. In fact he is very sensibly bullish on Tesla...

Elon originally estimated 100-200k in 2017. The market believed that was delusional. On the next ER he gave their parts orders numbers, which sounded less, But he never walked back his original estimate. Maybe the capacity of the alien dreadnaught v0.5 is closer to one car every twenty seconds than 5k-10k, per week (which would mean no chocolate for @dennis).

 

[Mike Smith]

'on track to produce about 250,000 vehicles by the end of 2017'

When Tesla uses the language 'by the end of (year)', they usually mean run rate. But that wouldn't make sense since the run rate at the end of 2017 would be around 350k based on 5k per week M3 (250k/yr) + 100K/yr MS/X

Therefore Jonathan Hewitt is correct: he means 250,000 run rate for M3.

 

[erthquake]

We have to get the source document (Kallo's note) on this Benzinga article - the "journalists" that work at Benzinga are inexperienced and low-paid kids that are prone to making many mistakes, and I suspect that is the case here. It just does not compute.

Seriously. The author's picture looks like he's still in high school.

 

[Jonathan Hewitt]

'on track to produce about 250,000 vehicles by the end of 2017'

When Tesla uses the language 'by the end of (year)', they usually mean run rate. But that wouldn't make sense since the run rate at the end of 2017 would be around 350k based on 5k per week M3 (250k/yr) + 100K/yr MS/X

Therefore Jonathan Hewitt is correct: he means 250,000 run rate for M3.

If I'm not correct then expect @ValueAnalyst to appear here and announce that Tesla has made him look conservative once again

 

[austinEV]

'on track to produce about 250,000 vehicles by the end of 2017'

When Tesla uses the language 'by the end of (year)', they usually mean run rate. But that wouldn't make sense since the run rate at the end of 2017 would be around 350k based on 5k per week M3 (250k/yr) + 100K/yr MS/X

Therefore Jonathan Hewitt is correct: he means 250,000 run rate for M3.

This has to be the answer. As commonly happens, someone confuses rate with totals.

 

[FredTMC]

Something is fishy about the 150K M3 in 2017: even if they hit production of 5K per week in August, it is only 100K in 2017. It would be impossible to deliver 150K M3 with 5K/week production. I am really puzzled by this. Ben Kallo does not have record of outlandish claims. In fact he is very sensibly bullish on Tesla...

Agreed. Totally fishy

Makes more sense tesla is planning to exit 2017 at a production rate of 5k/week (250k/year)

If anyone has access to the actual Baird note, please review the exact language.
I find it impossible to believe that Ben Kallo would author the wrong numbers from Tesla mgmt.