For everyone who has been visiting TMC (bulls/bears), tomorrow will be a very telling day as Tesla is scheduled to release numbers after market closes. It’s not a secret that Tesla will not meet the projected 2,500/ week M3 production number for Q1, hence the current stock price....so the short-term question remains “has it all been priced in?”
This has been on my mind for the last two weeks as I am contemplating deploying some dry powder to pick up more TSLA. I think that if Tesla produces between 1,800-2,000/ week M3 (7 days) then we will have a very good chance of a nice pop to reclaim 260s/ maybe 270s if it’s above 2,000/ week (for the last 7 days). If numbers fall between 1,500-1,800, then it would explain why Elon is back to sleeping at the factory and the stock price might decrease a bit (being that it’s so low, I don’t know if it’ll move much anymore). For bears who are spelling gloom and doom, this is not the first time Elon has decided to take matters into his own hands (he is fully capable of it, let’s not get it twisted and forget his engineering/physics background, he is also a rocket scientist..) during Model S and Model X ramp, Elon tweeted about doing just that to get Tesla to where we are at now. If he stays at the factory, then I am optimistic that he and Tesla’s engineers will figure it out (sometimes you need the head honcho present to give you that extra jolt of motivation).
The question I have been asking myself today after hearing that Elon will be sleeping at the factory again is “why wait till now, why couldn’t he do this months ago?” Well, aside from being a very busy person, the best answer I came up with is that although there were numerous bottlenecks, Tesla was able to resolve them incrementally, and as Elon stated during the 4th Q 2017 CC,the ramp so far has been “exponential,” (although not as exponential as we TMC investors would like), it’s still moving much faster than the S/X lines (which took 5 years to get us to 2,000/ week). Hence, if M3 ramp is already at 2,000/ week in just 9 months of entering production, then I think we are at a very nice place. Previously when Elon was sleeping at the GF, I think he somewhat sized up the battery module situation and thought “we can do this, no problem.” His engineers likely thought the same, hence, the 8K was issued. So if they are in fact at 2,000/ week, then Tesla theoretically will only miss by 500/ week (that’s if you believe in the leaked email...), But this still pins Elon and his team is in a very precarious situation, how does he explain the 8k? So, to show that he is NOT taking this miss lightly (even if it’s only 500 M3/ week), Elon will be sleeping at the factory.... Now, if numbers fall between 1,200-1,400 (last 7 days burst rate) then that will not be a good thing as it shows we are much slower than anticipated and there’s another level of hell we’ll be experiencing and a capital raise is necessary so we don’t cut it too close to the edge. Might as well raise the capital this Q.
I’ll be sitting back, and watching it unfold tomorrow. At this point in time, I would still avoid options, they don’t call it a suckers bet for nothing.
