General Discussion: 2018 Investor Roundtable

[Bobfitz1]

I disagree.
There will be significant demand for leather for the foreseeable future.
And Chinese will want leather.

There are 1.4 billion cattle across the globe. I would expect that is primarily driven by food production not leather.
My guess is removing leather from Tesla steering wheels is likely to save 0 cattle from being raised and slaughtered.
The lady from PETA should be setting up tables outside supermarkets to educate people about the health and environmental reasons to give up or limit beef consumption, rather than wasting her time lobbying against steering wheel leather.

 

[Nathan]

Confirmed Model 3 deliveries for June in the US are currently estimated at 2k (and likely growing). This is based on a reporting rate of about 7% of all customers so fairly reliable. 200k in Q2 seems the most likely unless Tesla puts a severe brake on things once they are within a few hunderd deliveries or so?

I would expect them to hold off reaching 200,000 until Q3. Would be very surprised if that wasn't the case.

 

[kbM3]

I thought this was pretty significant.

Let's say there are 11 factories and they're each producing 500,000 cars per year. That means Tesla will sell 5.5million cars/year.

I think I heard Elon speculate (a while back) that Fremont could perhaps be optimised to produce a million cars a year. If 11 factories produced 750,000 cars per year that is 8,250,000 Tesla cars per year.

GFs will also be producing battery packs, which will be larger than automotive.

One thing that jumps out at me is that if you use the May 6200 sales # is right in the graph, then scaling that to March and April gives us ~4k and ~5k respectively, The April # is quite a bit higher than InsideEV's estimate.

Also my model shows ~179k US deliveries at the end of Q1, add the 11k M3 in Apr/May, and 6k MS/X in Apr/May, we're at 196k US delivery now, which makes 200k in Q2 look more unlikely.

Edit:

@schonelucht already linked to an analysis by Troy from a few hours ago:

@Troy did that work already 8 hours ago (and a lot more comprehensive than I did). See here Monthly Model 3 production numbers calculated from the market share chart in the shareholder meeting • r/teslamotors​

Some original Roadster sales don’t count towards the 200k limit.

 

[Bobfitz1]

What's more, by that time Tesla's pack costs will be below that level, whereas Nissan still needs to add the expense of cooling to it's pack architecture...

And, when Tesla reaches a target per KWh cost at the pack level, they mean their pack design. Which incorporates quite a lot of necessary hardware that competitors may not want or be able to build into their packs.

 

[kbM3]

Was anyone else surprised by the opening of body shops and Supercharger V3 installations this year? I thought they would be really trying to slow down this kind of spending in Q4.

 

[JRP3]

The lady from PETA should be setting up tables outside supermarkets to educate people about the health and environmental reasons to give up or limit beef consumption,

Of course they do that too, and much more.

 

[schonelucht]

I would expect them to hold off reaching 200,000 until Q3. Would be very surprised if that wasn't the case.

Everyone expects them to but the only sign so far we've seen is opening up Canada sales. But that can just as wel be seen as a play to make sure Canadians can still order with the very generous rebate there.

 

[scaesare]

Was anyone else surprised by the opening of body shops and Supercharger V3 installations this year? I thought they would be really trying to slow down this kind of spending in Q4.

I'm not surprised by the supercharger advancement... it's really an enabling technology, and also serves as great advertising. Given they don't spend on commercials and ads, and that Elon has stated that the overall supercharger spending is really pretty minor in the big picture, I think they believe this is $$$ well spent.

Not to mention the lost opportunities for sales in the future if they didn't continue to push ahead of the Model 3 wave...

 

[Cosmacelf]

Was anyone else surprised by the opening of body shops and Supercharger V3 installations this year? I thought they would be really trying to slow down this kind of spending in Q4.

Remember: Elon time. Supercharger V3 is still R&D now, the build out and spend won't happen until 2019. And Elon said that the body shops were just expansions of existing service centers, not new locations. Regardless, I would be surprised if we saw a body shop before 2019...

 

[sundaymorning]

The market is just slaughtering it today.

Dow rises more than 150 points as banks and Boeing shares climb

Just as fears of a reversal in the economy brought us to 245 the strength and vigor of recent jobs/income numbers will propel us upwards. $310?

 

[Krugerrand]

Yes they will. But it’ll take longer than it has at SpaceX (the car industry is bigger). Whenever Tesla is shipping the Semi, the compact, and the pickup truck, “analysts” will wake up and wonder where the hell did Tesla come from?

They’ll feel the pain before semi and pickup. You saw the Chart where the 3 is already leading seller in its segment. And that’s while in production hell and not even doing 3k/wk AND having only one car variable (RWD/LR/PUP). Imagine what that chart looks like at the end of Q3, then at the end of Q4. As Tesla increases 3 variables and then produces the base model.

How many cars does Tesla take from other segments? What percentage of vehicle sales caused GM to go bankrupt? Even if they are better positioned now, what percentage of decline puts them right back there? What about for Audi? BMW? Mercedes? Porsche?

Now add the Y to the mix.

By the time semi and pickup get here it’ll be like scoring an empty netter, rubbing it in the industry’s face and dancing on graves; overkill.

So, define take longer? I don’t know exactly when the camel’s back breaks. And maybe some OEM heroics happen that I can’t yet imagine. But I can see the stalled car on the tracks and I can see the train racing toward it.

 

[Krugerrand]

Seems like outdated thinking to me. Remember when most people were saying no one would want a phone without a physical key pad? Or that people wouldn't buy EV's? Visionary product planners do in fact dictate to the customer, they create something better that the customer didn't even realize they wanted. I suspect most people will be blown away by the simplistic futuristic interior, offered by no one else, and most won't care at all about leather. We shall see.

Besides, if someone wants leather in their car they can aftermarket whatever they want. Non-issue.

 

[RobStark]

Seems like outdated thinking to me. Remember when most people were saying no one would want a phone without a physical key pad? Or that people wouldn't buy EV's? Visionary product planners do in fact dictate to the customer, they create something better that the customer didn't even realize they wanted. I suspect most people will be blown away by the simplistic futuristic interior, offered by no one else, and most won't care at all about leather. We shall see.

Seems like wishful thinking to me.

I don't know on what device I will listen to music with in 7 years but I know what kind of music I will like.

Advancing technology doesn't change that.

Powertrain is like the music playing device. Leather is like the music, a personal preference no one is going to change with technology, design, marketing or marketing options. Or lack of options.

 

[Nathan]

Everyone expects them to but the only sign so far we've seen is opening up Canada sales. But that can just as wel be seen as a play to make sure Canadians can still order with the very generous rebate there.

I was just responding to your comment that "200,000 in Q2 seems the most likely". Always
felt that the beginning of q3 was the most likely time.
My confidence comes from the Canadian shipment which obviously serves two purposes
(help Canadians with rebate and pushes the 200,000 figure to q3), and from an earlier tweet
(don't have the quote) from Elon Musk to the effect that he would do the right thing for his customers
with regards to the timing of the 200,000 car. Afterall we are talking about many thousands of people
that would lose the tax credit if it doesn't happen in q3. We shall see soon enough.

 

[Mader Levap]

Disagree that it has nothing to do witb SpaceX. They make pressurized capsules that can be launched into space. This is not entirely unlike a submarine.

Hahaha, no. It is entirely unlike submarine.

First, direction. Space capsule has higher pressure inside than outside (space has almost zero pressure), but submarines have higher pressure outside (all that water that would like to get inside very much).

Second, pressure difference in case of space capsule can be at most sea level vs almost zero (vacuum), but underwater it can be many, many times higher.

Again, submarines have nothing whatsoever to do with SpaceX.

 

[Cosmacelf]

They’ll feel the pain before semi and pickup. You saw the Chart where the 3 is already leading seller in its segment. And that’s while in production hell and not even doing 3k/wk AND having only one car variable (RWD/LR/PUP). Imagine what that chart looks like at the end of Q3, then at the end of Q4. As Tesla increases 3 variables and then produces the base model.

How many cars does Tesla take from other segments? What percentage of vehicle sales caused GM to go bankrupt? Even if they are better positioned now, what percentage of decline puts them right back there? What about for Audi? BMW? Mercedes? Porsche?

Now add the Y to the mix.

By the time semi and pickup get here it’ll be like scoring an empty netter, rubbing it in the industry’s face and dancing on graves; overkill.

So, define take longer? I don’t know exactly when the camel’s back breaks. And maybe some OEM heroics happen that I can’t yet imagine. But I can see the stalled car on the tracks and I can see the train racing toward it.

Oh, don’t take me too literally, I was half making a joke about how analysts tend to look in the rear view mirror when making predictions. Tesla’s future dominance is obvious to us now, it’ll be obvious to most of the stock market by 2019. Analysts might take a bit longer

 

[JRP3]

Leather is like the music, a personal preference no one is going to change with technology, design, marketing or marketing options. Or lack of options.

I once thought leather was better. I no longer do. People once thought horses were better than cars. Most no longer do.

 

[The Blue Owl]

I once thought leather was better. I no longer do. People once thought horses were better than cars. Most no longer do.

He's not saying it's better, just that he likes it. So do I. From a sales/stock price perspective, I don't really care that Tesla might not offer it at all in the future; it's a non-issue. Personally, though, I would/will order leather if available.

 

[Bet TSLA]

I trust at the end of the day Musk will pivot. He is not an ideologue.... Leather is like the music, a personal preference no one is going to change with technology, design, marketing or marketing options. Or lack of options.

No. Elon understands first principles. Nobody wants leather, what they want are certain features. He'll deliver an interior that has those features, only more and better. Then he'll start a company (NoBull Inc.?) to manufacture that material and provide it to the clothing and furniture industries, or maybe he'll make clothing and furniture himself that nobody else can match.

 

[The Blue Owl]

Nobody wants leather

Speak for yourself.