General Discussion: 2018 Investor Roundtable

[aubreymcfato]

I think the moat is highly dependent whether or not FSD is using Tesla AP miles as data... Tesla is the only one who has billions of electric miles (and nobody actually knows how many of them, they discontinued the tracker a year ago. Last news was 4bn miles in March 2017).

A percentage of Tesla miles are AP-hardware-ghost-tracked miles (especially AP2); a percentage of those, real AP miles.

So, if these data are really important for AP and FSD, Tesla is in a good position. They proactively hid their tracks on this.

 

[Causalien]

That doesn't explain why rich people aren't buying Tesla's. There are a lot is rich people in Germany and there are but S class and 7 series and A8s about 20:1 vs Tesla's where as in America Tesla beats those brands combined. And I would get it if Germany didn't seem to be so progressive when it comes to the environment. Is there anything more environmentally friendly then a Tesla charging during Germany's solar duck curve? Are model S's more expensive in the first year then an S class or 7 series in Germany? The only thing that makes beams loyalty and really just the love of powerful German motor that makes lots of noise and rattles your bones.

In my opinion, Tesla still isn't well known in rich people's circle. I live in a city of rich folks. Their sons and daughters mostly buy Bugatti as that is the McDonald's of Luxury cars. If you want to tell people you are rich where I live(and probably a douche), show them your Bugatti. The other brand aren't as well known and are not immediately associated as you being rich.

Tesla seem to be a tech and north america phenomena and the brand name hasn't spread to the upper echelon of other countries. Model S and X are nice, but they sort of get overshadowed by all the other luxury cars on the street and seems just normal. They don't scream "I am rich" to everyone. I think the Roadster 2020 will correct that, but it is a far away dream.

Anecdotal evidence from a discussion I had with a socialite here who get taken to a lot of rides by rich people's kids on dates. She's never been in a Tesla before, but has ridden in all other high end sports cars.

 

[RobStark]

Tesla seem to be a tech and north america phenomena and the brand name hasn't spread to the upper echelon of other countries.

Norwegians love Tesla even more than Americans

Google Most Searched brands by country.

Most Chinese don't use Google. The English speaking elite do.


Norwegian and Chinese interest even beats Californian interest.

 

[schonelucht]

Based on this I’m expecting a very rough Q4 cash usage (maybe $1B) due to equipment payment terms, and maybe $400-$500m in Q1 (should be better than Q3 ‘17, but current production is still low).

I am still hoping that cash use is going the be the positive surprise for this quarter, although I am a bit less positive than I was a few weeks ago. Still, the increase in customer deposits and the sale of thousands of cars out of inventory should make for a nice positive cash contribution to offset some of the capex spending.

 

[schonelucht]

Didn't see this posted, but it seems we don't need to worry about where Tesla gets their cobalt: Tesla Has Found Yet Another Safe Haven For Cobalt Mining

Not sure if this is good news. Tesla turning to Cobalt sources from towns that were unprofitable mining the material before means its usual suppliers are getting more expensive or can't supply enough. Either way, strong signs of more expensive raw product.

 

[aubreymcfato]

Where did you find the maps? I've only found the 2016 version, here.

 

[Causalien]

Norwegians love Tesla even more than Americans

Google Most Searched brands by country.

Most Chinese don't use Google. The English speaking elite do.


Norwegian and Chinese interest even beats Californian interest.

Baidu dude for China. I can only find one stats for 2011 on cars though.

Google in china means going over the firewall. So are probably already somewhat involved with NA.

Some countries don't have google as most popular search.

I am surprised usa is toyota. Is your graph able to control for just the rich ppl's search?

 

[bambam4171]

Not sure if this is good news. Tesla turning to Cobalt sources from towns that were unprofitable mining the material before means its usual suppliers are getting more expensive or can't supply enough. Either way, strong signs of more expensive raw product.

As the Cobalt price has tripled in the last 2 years this is a fairly safe assmuption
London Metal Exchange: LME Cobalt

 

[Yggdrasill]

I haven't seen it mentioned here, but there will be a new government in Norway following the election last year. It took some time for this to become clear, as the results were not entirely unambiguous. It's clear that the (pro-environment) Liberal Party will join the current government from the last four years (The Conservative Party and the Progress Party) and they have agreed to a 85-page common platform.

Of the six major focus areas for the next four years, point two is: "Fullfil Norways climate obligations, so that we do our part to meet the climate challenge."

Some concrete measures (paraphrased):

- Introduce a flat CO2 fee for all sectors, of 500 NOK per ton, and gradually increase this amount over the next four years. Revenue will be used for mitigating the consequences within each sector.
- Increasing the taxation on vehicle CO2- and NOX-emissions, while reducing other vehicle taxes.
- Increased taxes on diesel, if this becomes necessary for meeting the goal of 100% zero emission vehicle sales in 2025. Any surplus revenue will be used to reduce the annual vehicle tax.
- Start work on a sustainable vehicle taxation model for after 2025.
- Keep vehicle tax and VAT incentives for electric cars for the entire four year period, in order to reach the 2025 goals.
- Form a plan to reach the goal of fossil-free public transportation by 2025.
- Consider requirement of zero emission transportation for deliveries for the public sector.
- Facilitate the rapid reployment of charging infrastructure in the entire country, through a combination of public measures and market-driven solutions, to keep up with the increased share of electrified means of transportation.
- Set requirements for zero emission or renewable solutions for public ferry bids, where this is workable.
- Expand the program for green shipping to include zero emission and hybrid concepts for different vessel categories by 2030.
- Give Avinor the task of creating a program for facilitating the introduction of electric planes in commercial aviation.
- Consider measures for simplifying the process of selling privately produced electricity to the grid.

It sould be said that none of this has been approved in parliament, yet, but this is what the government will be working for. The biggest one for Tesla is that they will be working for keeping the vehicle tax incentives for the next four years. The EU has approved the full exemption through 2020, so that seems like the likely outcome now. Maybe we'll see the introduction of some taxes in 2021, but maybe not.

 

[aubreymcfato]

Last year @ValueAnalyst predicted Elon reaching 20,000,000 by the end of 2017 - a prediction that ended up being much closer than many imagined at the time. Nice call!

This is true, but bear in mind that *a lot* of these are bots. A quick look here confirms it...

 

[Reciprocity]

In my opinion, Tesla still isn't well known in rich people's circle. I live in a city of rich folks. Their sons and daughters mostly buy Bugatti as that is the McDonald's of Luxury cars. If you want to tell people you are rich where I live(and probably a douche), show them your Bugatti. The other brand aren't as well known and are not immediately associated as you being rich.

Tesla seem to be a tech and north america phenomena and the brand name hasn't spread to the upper echelon of other countries. Model S and X are nice, but they sort of get overshadowed by all the other luxury cars on the street and seems just normal. They don't scream "I am rich" to everyone. I think the Roadster 2020 will correct that, but it is a far away dream.

Anecdotal evidence from a discussion I had with a socialite here who get taken to a lot of rides by rich people's kids on dates. She's never been in a Tesla before, but has ridden in all other high end sports cars.

It appears that my argument has gone way over your head. Forget about rich people for a second as you seem to be a little obsessed. Let's just focus on the half a million or so Germans who own a newish 6 or 7 series, S Class or Audi A7/A8. I'm assuming that these people a fairly well educated and read a bit so they are aware that electric cars exist. Given Germany's aggressive move towards renewable energy, it must be something that the citizens understand and mostly agree with? Maybe that is a bad assumption and maybe those who make 100,000 Euro or more just don't care at all about the environment but since they only make up a small percentage of the population, they do not have enough per to change what the government does with renewables.

Another odd thing someone mentioned that 60000 Audis A7 sold per year were mostly company cars. Do companies really like spending 2x as much for fuel and maintenance? They could easily install chargers, hell Tesla will give them the chargers.

Germany is an odd place that seems to understand renewables and the value of doing green yet they love highly polluting diesel engines and $5.50/gal gas.

The only thing that explains it is brand loyalty. Brand is a strong thing. Here in America, the Ford and Chevy pickup people will literally get in fights over which is better and they would never buy anything else. Pickups will be a very tuff market for Tesla to crack, much harder then anything they have done this far. I'm thinking that is in part why they went with the Semi first. To build credibility in the tuff work horse truck world where it's not all about design and sex appeal of the vehicle.

Anyway, back to Germany. The conundrum is why are the well to-do German consumers shunning EVs when they are clearly better for the environment, cheaper to operate and own and higher performance in most cases. It's a huge as market, especially in the 3 series and up range. Probably 4th largest or maybe even 3rd for Tesla's specific niche.

For a country the size of Montana, the charging network shouldn't be an issue. If people strive a lot for business throughout Germany, the range and charge speeds might be an issue but that should be a small minority of the addressable market. For all intents and purposes, Tesla should do great there, but it's basically a virgin market still. This is one reason Tesla still has enormous room for growth. Once model 3 cracks this matter, model S/X will take off there.

 

[mutle]

I'm assuming that these people a fairly well educated and read a bit so they are aware that electric cars exist. Given Germany's aggressive move towards renewable energy, it must be something that the citizens understand and mostly agree with?

I now see articles that propose that EVs are not really as clean as people think and maybe it's all the same almost weekly now in the German press. This has become the most common theme for an EV article in recent months and everyone has different results, but usually they argue that EVs are not that great. I suspect some big business interests behind this seemingly coordinated FUD.

The non-Tesla EV fast charging network is actually pretty decent now, except for the need for multiple charging cards. I run the site CCS/Combo Charge Map - Europe to keep track of CCS installations and some 4-stall and >50kW charging locations, as well as good coverage of rest stops with at least single chargers has been added this year.

I think the Model 3 will do very well here.

 

[bdy0627]

Because so many interior design decisions were made on a much more optimistic FSD timeline (3mos,6mos). just simple stuff like the screen not being tilted (screen is optimized for video viewing) towards driver, no secondary info source, steering wheel only having two buttons. and now after a couple leadership changes with the AP group and FSD tech being at least say 2 years out and who knows how long regulation wise we aren't gonna be in a taxi relationship for a long time like Elon assumed (see: his twitter explanation for not having an info source in line of sight).

I hope they can quickly iterate and make some design changes software and maybe even hardware wise based on our reality that we won't be in a taxi relationship with out vehicles for at least say 4 years? A proper hud/second info source or much more functional steering wheel would solve a lot of these problems JMO

I agree that there were some very forward thinking design decisions implemented in the 3, which I think is a great thing. I don't believe FSD is 2 - 4 years out. It will certainly be much later than EM estimated but I think it is still going to happen within 2 years with significant progress within 1 year. Just my opinion.

 

[Starno]

I get where everyone is coming from and its somewhat depressing because these are all linear ramps for the most part. Where is the S Curve in these estimates? Could it be more like 8k in Q1, 24K in Q2, then 60k in Q3 as the curve goes more vertical and flattens out to 70-80k in Q4. My point is that we could all see a bit more pain this quarter as wait for the vertical part of the S Curve. With each bottleneck that is resolved, you should see a step up almost instantly. You kind of see that Q1 where the pack assembly fixes should lead to 5-8x the production over Q4-2017 based on the estimates here, which would be a significant increase. Maybe 5x is more likely for Q1, but then another 3x for Q2 and Q3, flattening into the end of the year at a rate closer 5k/w.

My main point is that any estimates should try to figure out where the S Curve goes vertical and these estimates are all linear. Maybe the S Curve is a myth anyway, but it seems logical that you would have noticeable increases in production as production bottlenecks are removed.

Well it's already not linear : it took 6 months to go from 0 to about 800 a week. If it was linear, in 6 months we would be at 1600 a week...

 

[Mike Smith]

Sergio Marchionne now says the auto industry is going electric, only those with strong brands will survive, and he's retiring.

Fiat Chrysler’s Marchionne: The Future of Cars Will Be Electric and Commoditized

 

[Reciprocity]

I now see articles that propose that EVs are not really as clean as people think and maybe it's all the same almost weekly now in the German press. This has become the most common theme for an EV article in recent months and everyone has different results, but usually they argue that EVs are not that great. I suspect some big business interests behind this seemingly coordinated FUD.

The non-Tesla EV fast charging network is actually pretty decent now, except for the need for multiple charging cards. I run the site CCS/Combo Charge Map - Europe to keep track of CCS installations and some 4-stall and >50kW charging locations, as well as good coverage of rest stops with at least single chargers has been added this year.

I think the Model 3 will do very well here.

I cant imagine a cleaner place to operate an electric vehicle. The big knock was that they fueled by Coal, but Germany has a lot of renewables so the amount of coal used to power EVs would be smaller then almost any country.

 

[Starno]

I now see articles that propose that EVs are not really as clean as people think and maybe it's all the same almost weekly now in the German press. This has become the most common theme for an EV article in recent months and everyone has different results, but usually they argue that EVs are not that great. I suspect some big business interests behind this seemingly coordinated FUD.

The non-Tesla EV fast charging network is actually pretty decent now, except for the need for multiple charging cards. I run the site CCS/Combo Charge Map - Europe to keep track of CCS installations and some 4-stall and >50kW charging locations, as well as good coverage of rest stops with at least single chargers has been added this year.

I think the Model 3 will do very well here.

It definitely will. German are pragmatic by nature. They're hard to convince when it's only talk or read, but if they try something first hand, and have a good experience with it, they'll immediately turn in favor of it.

 

[Jonathan Hewitt]

I cant imagine a cleaner place to operate an electric vehicle. The big knock was that they fueled by Coal, but Germany has a lot of renewables so the amount of coal used to power EVs would be smaller then almost any country.

You should imagine some more then. Germany is 7th worst on this list in the world for total C02 emissions
List of countries by carbon dioxide emissions - Wikipedia

Some more info
German electricity was nearly 10 times dirtier than France's in 2016

EXCLUSIVE: German Emissions Increase in 2016 Due to Nuclear Plant Closure

 

[Yuri_G]

And the big battery wins again.

Tesla’s massive battery in Australia was paid up to $1000/MWh to charge itself

 

[Reciprocity]

You should imagine some more then. Germany is 7th worst on this list in the world for total C02 emissions
List of countries by carbon dioxide emissions - Wikipedia

Some more info
German electricity was nearly 10 times dirtier than France's in 2016

EXCLUSIVE: German Emissions Increase in 2016 Due to Nuclear Plant Closure

Everything is relative I guess..

Germany has been getting up to 85 percent of its electricity from renewable sources on certain sunny, windy days this year.

Germany just hit a renewable energy record

Just charge your car when they are paying you to charge:
Germany is producing so much renewable energy it's driving electricity prices below zero

A little more then half as much CO2 per capita compared to US from your link:
List of countries by carbon dioxide emissions - Wikipedia

Country CO2 emissions (kt) in 2015[2] % CO2 emissions by country Emission per capita (t) in 2015[3]
World 36,061,710 100%

China 10,641,789 29.51% 7.7

United States 5,172,336 14.34% 16.1

European Union 3,469,671 9.62% 6.9

India 2,454,968 6.81% 1.9

Russia 1,760,895 4.88% 12.3

Japan 1,252,890 3.47% 9.9

Germany 777,905 2.16% 9.6

I think the point is that Germany appears to be environmentally minded and EVs are better then Diesel no matter what kind coal you burn to get the electricity.

I agree that they should not be shutting down Nuke plants before Coal, but I dont have a clue what the condition of those plants are, maybe they are past their useful life.