General Discussion: 2018 Investor Roundtable

[neroden]

Elon said that the two existing lines could eventually get to 5K/week (paraphrasing) and the new one is better. So sounds like with time maybe 4 GA lines to get to 10K+/week.

So, from what I'm hearing (and maybe I've misinterpreted), the existing lines still aren't at 2500/week/line, which is bad. Accounting for Elon optimism, the new "better" line is probably capable of 3000 - 3500/week, so yeah, maybe 3 or 4 lines for 10K+/week. Not as good as I'd hoped. I wonder what parts of general assembly are causing the remaining bottlenecks.

I doubt there's room for that at Fremont. I suppose 1 line in Europe and 1 line in China would help; they can ship the cars as kits, pre-general-assembly, I guess.

Of course if we're lucky they'll get more out of each individual line, but we've known all along that general assembly is the hardest part to automate efficiently. :-(

 

[defc0n]

It actually sounds like the exact opposite to me. If it was the central Puerto Rican government, Musk would have one large project underway. The South Australia Big Battery was 1 project (one). 11,000 projects, to me, means 11,000 separate contracts and probably 11,000 separate customers. This is the usual meaning of "number of projects" in the contracting businesses.

Hence why I put project(s). Just because there are several of them doesn’t mean their central government isn’t involved.

 

[BozieBeMe2]

Well, that took longer than I expected for the PITA people get a question in.

This may seem a bit self serving but what if someone wants leather? Why should their selection be limited

 

[BozieBeMe2]

How does a guy with 10 shares get to this meeting and ask a question?

The same as the little girl who only has -1- share

 

[MXWing]

Sooo, is anyone else concerned that they're using three general assembly lines to get to 5000/week? What worries me is the possibility that they'll need six general assembly lines to get to 10000/week. This would probably permanently reduce margins on Model 3, even if the other lines (body, paint, battery modules, etc.) don't need to be sextuplicated.

Patience. Get production to fulfill demand than optimize.

More cars at less margin is better than no cars at all.

 

[Todd Burch]

Remember there are many lines.

Neroden, I don’t think you can conclude anything unless we know how many general assembly lines were planned with the latest gross margin forecasts. Assuming there were only going to be 2 lines per 5,000 may not be correct. We just don’t know.

 

[MXWing]

Elon said that the two existing lines could eventually get to 5K/week (paraphrasing) and the new one is better. So sounds like with time maybe 4 GA lines to get to 10K+/week.

I read it as 2 lines SHOULD do it, 3 for certain. I agree with what your reasoning.

 

[BozieBeMe2]

But the other side of that is larger packs can charge faster per mile at the same C rate, so effective charge speed increases.

Also, the larger pack will effectively give you more usable drive time faster because as the smaller pack reaches 90%, it starts to slow down for balancing. If your 90% reflects a smaller range due to it being a smaller pack, then the larger pack at 80% should reflect a higher range.

 

[defc0n]

@neroden , Governor Rosello was communicating with Elon via Twitter last year about bringing Tesla to the island: https://www.inverse.com/article/455...-the-staggering-scale-of-puerto-rico-projects

As you likely recall, another Tesla energy deal was initiated via Twitter with for the southern Australia project. I obviously don’t know for sure if that’s a similar situation here, but a decentralized grid project(s) spanning the island would seem to make sense, which I believe what Fred is also getting at.

And yes, if true, should likely have central government financing involved. Tesla working to cut separate deals with 10,000 different entities doesn’t make sense to me.

Alas, no one still seems to really know.

 

[defc0n]

Or, you know, it could totally be 11,000 Puerto Ricans suddenly buying power walls on their own accord separately .........

 

[JRP3]

This may seem a bit self serving but what if someone wants leather? Why should their selection be limited

Makes more sense to limit options for production. No other leather is used in the production, no good reason to, so eliminate it. No one is going to not buy the car because of a missing outdated material for the steering wheel.

 

[electracity]

Sooo, is anyone else concerned that they're using three general assembly lines to get to 5000/week? What worries me is the possibility that they'll need six general assembly lines to get to 10000/week. This would probably permanently reduce margins on Model 3, even if the other lines (body, paint, battery modules, etc.) don't need to be sextuplicated.

I'm confused why they need three lines if they are running three shifts. I doubt that the paint shop will ramp like Elon projects.

But if they can get anywhere near cash flow nuetral they have time to figure it out.

I suppose they are planning on the model Y greatly reducing model 3 demand. Otherwise I don't know where they plan to build the model Y.

 

[UnknownSoldier]

Sooo, is anyone else concerned that they're using three general assembly lines to get to 5000/week? What worries me is the possibility that they'll need six general assembly lines to get to 10000/week. This would probably permanently reduce margins on Model 3, even if the other lines (body, paint, battery modules, etc.) don't need to be sextuplicated.

They are planning to be profitable in Q3/Q4 with the current lines. The question is largely academic at this point. They will have more lines in the Shanghai and Europe GFs anyways. They don't need to be at 10k/wk just in Fremont and there's no room there anyways.

 

[TradingInvest]

I thought it was about Tier 1 Suppliers, though the topic in relation to automation, I took it to be that Tier 1 suppliers were not as easy to work with as Tier 2 and 3, which could explain why they stopped using alcantera in model 3.

It's a great move to remove all Tier 1 Suppliers.

Tier 1s pose several challenges to the OEM.

1. Tier 1 is the most technically challenging tier, also has better margin among all tiers.
2. Relatively difficult to maintain dual Tier 1 suppliers.
3. Difficult for OEM to change schedule if a Tier 1 can't/reluctant to move at high speed.
4. Tier 1 can learn all the technical details, making it easier for the OEM's competitors to copy.

So going forward Tesla will do all the tier 1 functions and only maintain Tier 2 and Tier 3... This is hard to do at the beginning, once they achieve it, it's really great for the company. Not only getting more profit, but more importantly will reduce risk. They can easily maintain multiple suppliers for each component. Faster feedback/change loop.

 

[Garlan Garner]

Look.....bottom line -

Tesla IS sitting at 500 model 3's per day at a sustained rate - and that was before the recent upgrades.

If you look at the Model 3 thread here and follow the pics that members are posting daily of the parking lot....you will see CONSTANT streams of car movers moving cars out of the parking lot on a 24 hour basis.

Now that Tesla has upgraded the 500 per day car line.....I wouldn't doubt that the line could be sustained at much higher rates.

 

[defc0n]

This is why the semi is doable.

I happened to have a back and forth conversation a few days ago with someone who worked on the Cummins Aeos truck. As you might expect, he was quite skeptical about Tesla’s claims about semi performance—particularly about what it would have to weigh for 500+ mile range. And, given my obvious lack of tolerance of what I perceive to be from others, you can probably imagine how our conversation ended up.

(And yes, I do currently believe all of Tesla’s claims on semi specs.)

I vehemently stated that diesel is climbing into its death bed at this time. He said electric trucks are literally 20+ years from being viable. That coming from someone that worked on a somewhat comparable electric truck, I very much found that claim fascinating from someone in their positon/experience.

Take this all for what you wish to make of it I suppose.

 

[defc0n]

Oh, other than weight, recharging time was a huge part of their skepticism too for it being viable.

 

[EnzoXYZ]

Below is found in my daughter’s year book (kindergarten- 5th grade). Obviously kids knows best when it comes to technology. I was very pleasantly surprised to see Tesla mentioned. Someone at their school knows the impact Tesla will have in their future.

 

[SPadival]

Marketwatch can open a proxy advisory company. How the hell is this journalism?

https://web.archive.org/web/2018060...y-to-hold-elon-musk-co-accountable-2018-06-05

 

[geneclean55]

Or, you know, it could totally be 11,000 Puerto Ricans suddenly buying power walls on their own accord separately .........

Bingo! I love that we have the same thinking on this!