General Discussion: 2018 Investor Roundtable

[myusername]

It could also mean they had enough parts to run continuously for some number of days at a 1,000 /week rate. 200/day or 142/day depending...
Did not make 1k in a week, but could have (assuming all raw material movement operations also kept up)

like I said the other day... Elon will provide some tidbit in the report to allow you to hang onto the story. there's a handful of them in there...

"In the last seven working days of the quarter, we made 793 Model 3's, and in the last few days, we hit a production rate on each of our manufacturing lines that extrapolates to over 1,000 Model 3's per week"

this statement neither provides guidance or data that would qualify as scientific analysis... so why is it being referenced at all?... to keep the story going... and that's why it's in there.

 

[elasalle]

Exactly. They may be producing ~ 700 per week for maybe a few weeks. Perhaps get to 1000 by February. This is realistic based on what was actually said.

this is worst case scenario.

 

[stef]

Or that both Fremont and Gigafactory are now at 1000 but as Fremont needs to get the cells (after aging and transport) to finish a car the actual production is reflecting where they where few weeks ago.
Speculation obviously

 

[mongo]

Or that both Fremont and Gigafactory are now at 1000 but as Fremont needs to get the cells (after aging and transport) to finish a car the actual production is reflecting where they where few weeks ago.
Speculation obviously

Aging should be on Panasonic cell side, so I'd expect that buffer to be full.

 

[Buddyroe]

Mod: posting deleted. --ggr

Who is "them"? I am not trying to play long vs short, hater vs fanboy. I am long Tesla, but unlike many others, I look at Tesla objectively (at least from an investment stand point). And looking at the current M3 situation objectively, it simply isn't very good.

The sad thing I see here on this forum is that the shorts will find some doom and gloom even if Tesla were producing 10k a week and demand increased 5 fold for the car. But, at the same time, the longs find the silver lining in every piece of bad news - no matter how bad the current news is, it's ok, because it's the future that matters (does the future ever actually get here?).

This car was supposed to be the one where they had learned their lesson from the MX and simplified it so they could produce it much more easily - without all the issues they had with the X (due to the complex Falcon Wing Doors and other complexities). That simply hasn't helped improve their production ramp-up time. I'm tired of hearing crap like, "build the robot that builds the robots that build the cars" - if you can't build a car, you definitely can't build robots.

Come on EM. I'm SO ready to prove the haters wrong. I'm still long, still believe in EM, still believe in Tesla - but it's time to do what is needed to right the ship. At this rate, the Model Y will be out in 2021 (and another 2 years to ramp up), the Semi in 2023, and the pickup in 2027. And there's absolutely no reason to believe these dates are exaggerated, based on Tesla's past performance.[/QUOTE]

 

[aubreymcfato]

This is good news for TE:
Pressure on NSW as Victoria joins South Australia with large-scale battery

Unfortunately, I don't see a deadline.

 

[DragonWatch]

Any bets GM, Ford, Mercedes, Volvo, etc. wish they had Tesla’s problems?

Built up demand, M3 reservations, newest technology assembly line, a gigafactory pulsating; yeah, i’ll bet they are real happy not to have these problems.

FYI ~ I am very jealous of you that get to see M3s in the wild Green with envy

 

[bdy0627]

Who is "them"? I am not trying to play long vs short, hater vs fanboy. I am long Tesla, but unlike many others, I look at Tesla objectively (at least from an investment stand point). And looking at the current M3 situation objectively, it simply isn't very good.

The sad thing I see here on this forum is that the shorts will find some doom and gloom even if Tesla were producing 10k a week and demand increased 5 fold for the car. But, at the same time, the longs find the silver lining in every piece of bad news - no matter how bad the current news is, it's ok, because it's the future that matters (does the future ever actually get here?).

This car was supposed to be the one where they had learned their lesson from the MX and simplified it so they could produce it much more easily - without all the issues they had with the X (due to the complex Falcon Wing Doors and other complexities). That simply hasn't helped improve their production ramp-up time. I'm tired of hearing crap like, "build the robot that builds the robots that build the cars" - if you can't build a car, you definitely can't build robots.

Come on EM. I'm SO ready to prove the haters wrong. I'm still long, still believe in EM, still believe in Tesla - but it's time to do what is needed to right the ship. At this rate, the Model Y will be out in 2021 (and another 2 years to ramp up), the Semi in 2023, and the pickup in 2027. And there's absolutely no reason to believe these dates are exaggerated, based on Tesla's past performance.

Yes and no. This Model 3 ramp is clearly NOT like the Model X. It is way better. The problem lies with Tesla's own guidance for the ramp. This actually could have been a win if they had guided differently 6 months ago. They continue to set themselves up for short term failure by creating nearly impossible expectations. Perhaps with the latest much more conservative ramp guidance, they have finally learned that lesson, but I doubt it. This is EM after all.

 

[viridi]

EM might want to take the approach that many high growth tech CEOS take: keep estimates conservative to the street, but make internal goals far more aggressive (through bonus targets, performance stock units, etc.).

 

[DragonWatch]

Look at the InsideEVs 2017 chart and analyze all the EVs (general term). There is a lot of information there, while only US sales/deliveries, it shows they are progressively getting higher numbers, but some are struggling. At the same time other countries are light years ahead in creating laws to outlaw fossil fuel cars. Get a grip folks and hang on ~ no one said this would be a piece of cake
Monthly Plug-In Sales Scorecard

 

[SebastianR]

A bear and a bull argument, pretty much what we should have all expected. The S/X deliveries were rip your face off beat the market great. That said, without Model 3 production to back it up, no one cares. What does this mean going forward is the important question, not what is today's market response, or who can spit out the nastier response.

Long post, worth the read. One thought I had on this is a bit facetious - but hear me out: I'm wondering if this behavior Tesla is going against their mission of advancing the world's transition to sustainable transport and plays into a game plan of establishing a monopoly market of EVs.

Think about it: if you are an incumbent of the existing old industry, you will look at these numbers and say "see! I told you! Tesla can't ramp, this stuff is hard. Also, Tesla is not profitable, so we don't need to invest into our EVs". This might lead to others kicking the can down the road a bit more (this is the story I read in many forums that are close to the incumbent industry).
If Tesla would have guided a delivery of zero M3 - the story would be "OMG! Look at these Model S / Model X numbers. And now look at this M3 - they already delivered thousands of these cars!"

I'm honestly pretty surprised that Tesla is allowed to act without any competition in the luxury market and they can take market share as they please with an essentially "not fresh any longer" Model S+X.

I mean this is classic "0 to 1" / "blue ocean" stuff. I know that Elon Musk and Peter Thiel both worked at Paypal. But I'm amazed the others let this happen. And stories like these delivery numbers (intentionally or not) support the creation of a luxury market EV monopoly.

 

[Zaxxon]

Not necessarily.
...
Just means that there was a ramp within a ramp in the same week. Started the week with rate less than 1K/week, ended with 1K/week.

Exactly. They may be producing ~ 700 per week for maybe a few weeks. Perhaps get to 1000 by February. This is realistic based on what was actually said.

This. They very well may be at 1k/week now and off to the races from here. But they did not actually say that. They used weasel words to give the impression of 1k/week, when they have not actually achieved an actual 1k/week yet. They've achieved something over a smaller period, which if continued would extrapolate to 1k/week. Those of you who were around for the X ramp may recall similar language used that gave the impression of one rate, and the next quarter we found out that that rate was in no way, shape, or form maintained from the point the initial impression was given through that quarter.

Which is not to say that is what's happening here. But we should keep our estimations conservative and not assume that 1k/week is A Thing™ right now. They very well may have burst to a 1k/week equivalent for a few days, then dropped to 500 or 600 for some time.

That said, my personal thought is that this ramp is not the X ramp, and they are far more likely to actually maintain their ramped rate with the 3 as they step forward. Which is why I used 1k/week in my guesstimations yesterday. But it's wise to understand that Tesla often uses language in these updates that leads one to believe they're saying things that may not be what they are actually saying.

 

[scaesare]

promise.

 

[avoigt]

Sometimes it happens to get lost in details and miss the larger picture.

With Tesla reporting record numbers for 2017 something that nobody can dispute and taking in context the shrinking auto US market I would say thats impressive.

Given the uncertain outlook and keeping in mind that Tesla is well on the way to deliver, say a 200% growth ...... maybe more in 2018 I dare to say thats even more impressive.

Car Sales End a 7-Year Upswing, With More Challenges Ahead

U.S. annual car sales

* Sorry for the format of the graph, last column is 2017 with about 18 M

 

[JRP3]

Or that both Fremont and Gigafactory are now at 1000 but as Fremont needs to get the cells (after aging and transport) to finish a car the actual production is reflecting where they where few weeks ago.
Speculation obviously

I think GF is assembling cells into packs which then go to Fremont.

 

[supratachophobia]

Aging should be on Panasonic cell side, so I'd expect that buffer to be full.

I dont know, there was plenty of room in those rooms. interesting to see who might be the bottle neck here.

 

[avoigt]

Some more data about the Model 3 ramp speed versus MS and MS. A picture can sometimes help to understand that the M3 ramp is way faster than the previous models.
https://i.imgur.com/uE4Ay0j.png

 

[Reciprocity]

Close in the green today or nah? Place your bets.

 

[schonelucht]

the current 4Q EPS estimate is at -3.03. Are Actuals going to be better .. ?

Yes. That is my prediction. To be around half the current estimate. I have been very wrong in this game before. I also have been reasonably right at times. It's hard.

The biggest thing really is how much S/X can get back to regular gross margin after last quarter. They said last quarter's drop was due to one-off adjustments so I took it to mean they will be back to normal this quarter and only made a minor adjustment for the 7730 cars they sold out of inventory. I suspect the consensus is a bit more conservative here. Another assumption from my part is that they managed to stop the bleeding on service & others. If analysts know more there than I do through private talks with management, that could also make a significant difference. Remember that this also includes trade-ins and CPOs so it is a business segment with a growing importance and it is a large loss center. Finally, I only calculated a net loss of $5M on the South Australia nor did I take into account any losses on Puerto Rico deliveries (possibly seen as corporate charity) I know it is controversial here but I think reasonable people can assume larger losses on those projects, especially as the cells are not Gigafactory sourced and pack assembly was likely a fairly manual process, but the pricing still at just $250/kWh as if none of that were the case.

 

[powertoold]

Some more data about the Model 3 ramp speed versus MS and MS. A picture can sometimes help to understand that the M3 ramp is way faster than the previous models.
https://i.imgur.com/uE4Ay0j.png

People need to stop comparing the 3 ramp to S/X. It should be vastly superior no question, per Tesla themselves.

The fact that it is faster than the S/X ramp doesn't make it good or okay. The longer Tesla takes to ramp up the 3, the longer it'd take to get to their 20%+ gross margin. Somehow I doubt they'll be able to achieve any decent margin on the 3 either, considering we can't trust anything they say.