General Discussion: 2018 Investor Roundtable

[woof]

Short-sellers are sellers, so you are simply saying that sellers don't affect the share price. By symmetry, buyers don't affect the share price either. The only explanation left is gremlins.

Nope, not gremlins--Unicorns. Dancing in flame ducts.

 

[Dennisj00]

I don’t see any OEM working with a Tesla spinoff for autopilot just as a matter of pride- even on their vertical ride down!

 

[Cosmacelf]

I totally understand your frustration. But if looked closely, there are big problems with every single company.

Take Apple, to put it bluntly, they simply don't know how to build large scale software. In many of their acquisitions, key people take the money and left. There are no proper software engineering practice in their internet and services departments. They spent zillions of dollars on data centers and leave the computers run cold, at the same time spend sugar load of money buying cloud storage service from Microsoft before and Google nowadays. It's leaky abstractions and spaghetti code everywhere. That widely praised "walled garden" ecosystem, there is no clearly defined interfaces and protocols, everything is adhoc. And that's the real reason for the "walled" garden cause they can not easily integrate with third party without severely compromise security. They heavily rely on an army of functional test team to ensure the thing works before release, and that's the reason for the delay of home pod. Without clearly separated components, it is difficult to locate problems early. This leads to delivery crunch time, sleepless nights for the engineers and tester, and of course, burn outs.

Yet, Apple is still Apple, it still provides a smooth experience, ahead of everyone else.

I agree 100%. The only reason we know of so many faults within Tesla is that Elon tells us. Other companies are just as, if not more, screwed up, yet their CEOs will smile all the way to chapter 11.

In that video of the guy who reverse engineers cars, he gave an anecdote about one of the big 3 automakers. He arrived on site as a troubleshooter. The executive in charge was beside herself because the manufacturing line was stopped dead, with union workers standing around doing nothing. The line robots just weren’t working properly and the union guys weren’t about to fix them. His advice? Mothball the robots, and just have the union guys assemble the cars. Which is what they did. So, wasted capital, who knows how many days of zero output, and lower margins going forward, permanently. And that was the fix.

But somehow, the few automation issues Tesla had has been spun into a much worse thing. It wasn’t.

 

[Cosmacelf]

The problem is exactly the opposite in case of Tesla - they want Tesla to raise capital when they don’t need any. Where else will they get the commission from otherwise? And they will use every dirty trick in the book to make them raise capital. Nobody here seems to have noticed the curious case of Adam Jonas turning against Tesla as soon as Elon gave him an emphatic NO in the ER call even as his masters at MS bought Tesla shares.

Wall Street big banks routinely act in concert with each other to raid a target for their own gain. I wouldn’t put it past them to fund short positions to force Tesla to raise money on their terms. I’m not saying that they’ve done that or will do that, just that they are are quite capable of it.

 

[BioSehnsucht]

From what I can tell it is pretty good.

It only works on highways that have been mapped by GM. Which is all major US highways.

It is not good for city streets. It can't automatically change lanes. Even under emergency situations where driver is incapacitated and the car needs to stop on the side of the road.

It is hands free. I think this is the major selling point. It monitors the drivers eyes to make sure the driver is paying attention.

It is only available in the two highest trims of the most expensive Cadillac sedan, the CT6. The plug-in hybrid CT6 is not offered in the two highest trim levels.

How well does eye monitoring work if you're wearing shades?

 

[StapleGun]

The lad doesn't understand or does not put a high value on safety.

He said there were panels he found and had no idea why they were there.

Tesla spokesman specifically cited safety as the top concern when engineering the platform.

Hint: Those panels were there for reinforcement to increase passenger safety.

We regularly hear about how a legacy automaker compromised safety to save a few pennies or a few dollars on a part. Tesla does not do that. In the long run that is good for Tesla's bottom line.

I hope something as simple as copying existing optimization techniques will provide a meaningful boost to Model 3 margins. I'm sure some of the extra material is there for good reasons (eg safety) but I doubt Tesla has found the optimal form yet and that is a very good thing.

 

[RobStark]

How well does eye monitoring work if you're wearing shades?

I guess it really monitors your face, because it does work with sunglasses.

Cadillac guy in vid says major highways in Canada also mapped.

 

[Oil4AsphaultOnly]

• Production location: Going from "we know where we want to build it" to "we're still figuring out where to build it" 17 month prior planned production start. This is not exactly a signal you want to send. Hope he's bluffing on this one.

I'm curious about this. Did I miss an announcement somewhere? Where did Tesla say that Model Y production was going to start in Oct 2019? I know it was speculated to be Nov of 2019 by a reuters article, but until Tesla says it, it's not "planned".

You're going to raise your anxiety level if you hold Tesla to expectations that were placed by the rumor mill.

 

[UnknownSoldier]

Pretty sure Elon said during the last call that he's expecting the Y in 2020. It's being pushed back because of the drive to reach consistent profitability first.

 

[Cosmacelf]

Pretty sure Elon said during the last call that he's expecting the Y in 2020. It's being pushed back because of the drive to reach consistent profitability first.

The latest call, Elon said 24 months for the Y. So that’s 2020. Has Elon/Tesla said something else since 2 weeks ago?

 

[UnknownSoldier]

I just wonder where AWD 3 orders are. Elon promised us that by the end of this week, didn't he?

The latest call, Elon said 24 months for the Y. So that’s 2020. Has Elon/Tesla said something else since 2 weeks ago?

Nope, that's the time frame I was referring to.

 

[sundaymorning]

I just wonder where AWD 3 orders are. Elon promised us that by the end of this week, didn't he?

Shorts were wondering for a very long time about the Model S, then they wondered about Model S AWD, they wondered about te X, then wondered about the X AWD, then wondered about the 3, and here you are....

And by the way, about 450,000 reservation holders are also wondering, so rest assure you’re not alone.

 

[DragonWatch]

From a somber service today, my wife brought home some interesting pieces of information this afternoon.

First, she is retired from WSDOT or Washington State Department of Transportation. While the service was to pay their respects to a friend and boss, it was not just a walk down memory lane. One of her friends was recently promoted, and now is the chief engineer dealing with Autopilot; okay, I mean self driving cars.

He was excited about cars driving themselves; he said, “how exciting is that, cars that drive themselves.”! She looked back at him and said, “pretty damned exciting, that’s why we bought one.”

Edit: New technology in our day was the option to buy a car with a radio installed or electric windows:-(

Too bad I was not there, I am willing to bet Xena was damned near ready to take flight ~ I would have loved to witness that event. Instead I stayed home and mowed the lawn.

Bottom line even Washington State is focusing on new technology and how it will transform transportation in our future. There are page after page of hoof-an-mouth disease here over spilt milk. Poo is going to happen ~ the other bottom line.

I would love to have that guys job! But, they are not hiring any crazy uncle’s.

I have said this before and will say it again ~ technology is light years ahead of the human race. Some people still believe the world is flat.

Edit: While I will state I am not a numbers kind of guy, I have from time to time crunched some numbers to compare “what if.” You know, if I had bought fewer shares of such-n-such at $800 instead of a thousand shares of Tesla when it was $65. I jumped in fearing I over bought too high, because I had held off a week or so assuming it would settle down, but ~ well you may know the history. I basically sold Shell Oil to buy Tesla and not regretting it ever, despite the pain ~ “no pain, no glory.”

 

[avoigt]

Worth watching in particular the AP comparison he made about Audi and Tesla.

Also good to see someone testing the car who informed himself upfront.

 

[Ovulation]

I have said this before and will say it again ~ technology is light years ahead of the human race. Some people still believe the world is flat.

Sorry but I now I have to red pill you

This guy almost starved himself to death by sungazing

and now he blames the vegans for that lol

 

[Lhan]

Found this article this morning, and hoping that I am not over writing someone else ~ I apologize up front if I am.

Elon Musk promises $1 rides in LA transit tunnels

Edit: If my memory serves me correctly; honestly it has failed a time or dozen, but the airline industry did something similar back in the sixties by allowing potential customers to come to Los Angeles International Airport and fly around LA for $15 per ride. My team of Eagle Scouts helped get people in line and kept the peace. I was given two or three free rides. They (airline industry) were introducing jets if I am, again, correct. Bottom line look at the airline business today.

Rides in test tunnel will be free.

 

[ValueAnalyst]

How about this: Model 3 ASP in the second half of 2018 may be more than $60,000.

Since Standard Range is now a 2019 story, and P (10% take rate) and D (50%) are around the corner, as well as already popular EAP (80% take rate) and possible FSD-exclusive features in the coming months with the new-and-improved Karpathy-magic neural networks (50% take rate in 2H18 but possibly as high as 80% with a killer feature like even highway-only Level 3 at $3,000), including wheels and premium paint and delivery:

OPTIONS
Enhanced Autopilot: $5,000; 80% take rate
Full Self-Driving: $3,000; 80% take rate as exclusive features roll out
Premium Upgrades Package: $5,000; 50% take rate
Premium Wheels: $1,500 to $4,500; 50% take rate with $2,000 average
Paint: $1,000 to $1,500; 80% take rate with $1,200 average

MODELS
Long Range: $44,000 - 45%
Long Range with Dual: $49,000 - 45%
Performance with Dual: $75,000 - 10%

ASP without options: $49,350
ASP of options: $10,860
ASP: $60,210 excluding $1,000 delivery

Model 3 ASP may be more than $60,000 in 2H18.

Now consider that the ultra-bearish UBS analyst had estimated Model 3 breakeven (not COGS but EBIT-level so including R&D and SG&A expenses) at $41,000 (page 45 of 95) even using $160/kWh battery cost estimate, which is just dumb. His other dumb assumptions include D&A per unit and Warranty Provision per unit, which should be combined $3,000 per unit lower, but to be conservative, let's use his bear-level dumb assumptions.

$60,000 ASP in 2H18 - $41,000 COGS, R&D, SG&A = $19,000 EBIT per Model 3

31.66% EBIT margin in 2H18.

That's better than Apple.

If the above post is correct, bears are in for a fun ride. Digging it back up to solicit feedback.

 

[Anstandswauwau]

I'm curious about this. Did I miss an announcement somewhere? Where did Tesla say that Model Y production was going to start in Oct 2019? I know it was speculated to be Nov of 2019 by a reuters article, but until Tesla says it, it's not "planned".

You're going to raise your anxiety level if you hold Tesla to expectations that were placed by the rumor mill.

You're right. I mixed up the info from Q1ER and the rumor from Reuters, which was published 2-3 weeks prior that.

Q1ER transcript excerpt:

The Reuters report is based on nothing. Like I don't know where that came from. We will not be starting production on Model Y at the end of next year. I would say it's probably closer to 24 months from now. So 2020 is a more likely prospect for Model Y, early 2020.

And the production location for Model Y has not been decided. We're really crowded here at Fremont. I don't know where we'd put the Model Y production, so it's difficult to imagine that. We just could not fit the Model Y production at Fremont. We are jammed to the gills here.

So one thing I know for sure, it's not here. It is crazy packed and we're – yeah, so we'll try to figure out what the optimal location is for Model Y production, but it's not here. Not here at Fremont.

 

[Anstandswauwau]

I will give Elon the benefit of the doubt.

You don't know if something is overengineered until you look back on it.

I rather Tesla go for it the first pass around then simplify later. Or scrub the barnacles off later.

There's no question we could have made the Model 3 much easier to produce than we have. [...]

Okay. Very interesting. Last one. You mentioned earlier you think the Model Y production is going to be a true sort of production revolution. If you had to do the Model 3 over again there are some things that you would've changed, and you hope to incorporate those learnings into the Model Y. What specifically would you do? Or what specifically would you plan to do?

Well, I think – let's save that for another time. Like, we'll talk about that when we unveiled the Model Y. But it's really going to be dramatically better. The design and production system, I think, really will be next level.

I'm honestly a bit baffled to get all the sh1t and "disagrees" for simply repeating what EM said two weeks ago.

TMC slowly feels like an Apple fanboy forum in circa 2013 at peak toxicity. Hoped and thought we're better than that: Grown-ups, capable of self-reflection, critical thinking and discussion …

But if it's the sole point of this forum to circle-jerk each other off on the notion of how everything TSLA/EM does is so utterly perfect, why the hell is even called "General discussion"?

 

[Anstandswauwau]

Tesla has the most energy dense battery pack compared to other OEM's.

The energy density is not the point here – the cells themselves are basically all "chemistry" R&D effort and the production of cells is already highly, highly optimised (to the point of rivaling aluminium can production rates). The cells are not the problem. Hell, you could make the next "most energy dense" battery pack out of maybe 20-100 components (excluding cells) if you really wanted to. But again, that's not the point.

The hard part is to wrap those 3k cells into groups, then modules and finally into a package that can act as a base for your chassis. That's where mechanical complexity, (software) engineering, custom PCBs etc. come into play.

And there are multiple ways to approach this problem, but let me boil it down to only two for the sake of argument:

1. Totally geek out and try to make it "perfect" (Juicero comes to mind)
   
   
2. Design for profit- and manufacturability

With all the production bottlenecks and comments from EM (see above), I think we could rule out approach nr. 2, can't we?

They've been optimizing it's design for over 10 years now. It's as complex as it needs to be.

The packs in the original Roadster, MS & MX were rather naïve, inelegant, brute-force designs – not really comparable to the packs they're now producing. For the M3 pack they basically started from scratch, so this certainly wasn't a linear optimization process.

Some general principles may have carried over, but this is a Pack Gen 3, v1 and not a Pack Gen 1, v5.