Nonsense from John Petersen

[Zythryn]

Nope, I have stated several times: I think Tesla is a good investment (and I am in in a very aggressive way) because of the product. It's only when people get overexcited about saving the world that I shake my head

And JP talks almost exclusively about that aspect, and of course the business aspect (risks, cash on hand etc. etc.)

Oh, and I was taking the extreme example just because Tesla did - I was not criticizing the product or the approach.

Understood. I highly recommend you check out the paper I linked. It will give you some interesting 'ammo' when you next talk with John.

 

[Robert.Boston]

[moderator's gentle reminder: this thread is in the TSLA Investor Discussions forum, so please keep that focus in mind. More general discussions about energy, environment & policy belong in that forum, including the "long tailpipe" discussions. Thank you.]

 

[JRP3]

But one should also question Tesla communications. For example, Elon said that even if the electricity comes from coal, Model S is still greener than a normal ICE.

Guess what? By your own calculations Elon is right, since the average US car gets 24mpg. CO2 from NG is even lower, and daytime solar charging is quite possible, which means the S, and any EV, can be far cleaner than any ICE or hybrid.
Of course none of this has anything to do with my post to which you were responding, but it certainly is a standard Petersen tactic of misdirection. Is this an April Fools joke, a day late? If so, you got me.

 

[Dan5]

The funny thing is that he was spot on with most issues except Tesla and Axion (like failures of several US Li-ion battery producers).

I hope he will continue to be wrong about Tesla - we are in a very exceptional position to have Elon and a dedicated team behind, but the valley is full of the bones of those visionaries who wanted to change the world. Just imagine a full blast recall for the Model S because some faulty component from a supplier. Right now, Tesla does not have the resources to do that. And reservations of this cute car could simply come to a halt. that's one of the hardest industries of all and Tesla is against some giants (some of them are dinosaurs, but not all of them).

As for Axion, he was wrong with timing and the share price as a consequence. But the tech and the team are great. Once the ball starts rolling, their share price growth from a $31M market cap can do leaps and bounds around Tesla's [share price growth].

Well, the failures if the several US Li-ion manufacturers does not to a genius or actually anyone with 10 minutes of research to call.

AONE- they were banking on 100,000/yr of VOLTS and 20,000 Karma, When you only get 1/10, you are more or less screwed, not to mention all the screw-ups on AONE's end- shorted it with the CR Karma issues

Same goes for most other Li-battery manufacturers, doesn't take a crystal ball to know Ford planned to sell 20,000 EVs, delayed production, and only sold a measly 600, how that would HURT their battery supplier. Utilizing 3% of your plant is NOT a good way to run a business.

Most the the EV manufacturers set completely unrealistic goals and forced their suppliers to build to meet those goals- It was a devilishly cunning trap

 

[Zzzz...]

Well, JP forgets to mention the fact that li-ion industry is growing. And growing fast in recent years. So industry as a whole is profitable. Pointing out few bankruptcies is like claiming that beer is not a valid product because beer companies are going out of business all the time. While in reality lithium batteries(and beer) market is growing.

Market For Lithium-Ion Batteries Seen Doubling Through 2016 To Over $22 Billion

For now Japan market share declining and Korea and China are on the raise. Lithium-ion makers need recharge - The Japan Times

 

[Robert.Boston]

JP seems more like a white-wine guy than a beer guy. But good point--and a big plus to Tesla that it's relying on its batteries from two companies, and sales to Tesla are a small sliver of Panasonic's LiIon sales. Recently, Panasonic announced that it was going to be increasing its focus on the battery market, so presumably they see strong sales in many markets, including automotive.

 

[InsanityWolf]

John Peterson has been talking down on Tesla/ EVs for years. The first time I came across his articles was when Tesla was at $22 a share. Now that its above $40, I feel sorry for anyone who actually listened to this clown.

 

[Nicu.Mihalache]

He is obviously not an expert in Li-ion chemistry, but in the battery industry, which has more business than technical aspects.

But one should also question Tesla communications. For example, Elon said that even if the electricity comes from coal, Model S is still greener than a normal ICE. Just like oil, coal has to be extracted (much harder) and transported, but not refined. Let's put the 20% loss during refining into the 7% electric grid loss + 10-15% EV charging loss (let's forget about vampire loads etc.).

More than 2 lbs of CO2 are produced for 1 kWh from coal. This moves your Model S for about 3 miles. This means about 0.66 lbs / mile.
1 gallon of gasoline is about 6.07 lb. Burning is 2C8H18 + 25O2 ~> 16CO2 + 18H2O, that means 228 lb of gasoline produce 704 lb of CO2 (C is 12, H is 1, O is 16). Or a gallon of gasoline produces 18.74 lb of CO2. So to get to 0.66 lb / mile means around 28.4 mpg, which is average, much worse than my Prius.

Given that the car consumes much more energy to be produced and that after 10 years you may get a new battery, who knows, maybe is not greener. We all want to get to 100% renewables, but this will not be here in less than 50 years. Let's stay optimistic but pay attention to scales. For the time being, coal is pushed aside by a surprise contender: natural gas from fracking. Is it better? I don't know.

In China, where 1 new coal power plant was built every week for almost a decade, is it better to go EV full blast, or small cars like Volkswagen Lupo that may go above 60 mpg ?

Here is another real world measurement from a Model S owner (hopefully those numbers will improve with software updated and maybe even more efficient wall charger and even on-board chargers for new cars):
http://www.teslamotors.com/forum/forums/model-s-equivalent-mile-gallon-closer-60-empg#new

511 Wh / mile including charger loss, vampire loads and everything else. This means that the equivalent coal CO2 mpg drops around 20 mpg. Of course this is relative, in France we are closer to 40g of CO2 per kWh, an order of magnitude less than the US average and about 20x less than pure coal.

I have posted my thoughts here just because some of you asked me to do so. By no means I am starting a crusade against Tesla or EVs, I'm working my TSLA call options hard so I can afford a AWD super-sport Model S (with a young teacher / researcher salary in Paris) - and then lots of tire sets

Two things that all TSLA investors have to keep in mind are:
- we tend to become over-bullish in those forums, via a closed feedback loop, most of the time because of mixed feelings about business / market on one side and product excellence and awesome Tesla people on the other side (believe me, I've been hit hard with AAPL, losing the equivalent of three loaded-up Model S on AAPL options last fall - not so unrelated story with what is happening now with Tesla: great product, great people, booming sales and such)
- the market can stay irrational longer than you can stay solvent and mentally sane; as luvb2b told us, shorts are playing dirty games, both in the market and the media - we are fighting against the most ferocious sharks out there - be careful

 

[JRP3]

511 Wh / mile including charger loss, vampire loads and everything else. This means that the equivalent coal CO2 mpg drops around 20 mpg. Of course this is relative, in France we are closer to 40g of CO2 per kWh, an order of magnitude less than the US average and about 20x less than pure coal.

And if it's wind, solar, or hydro charged the CO2 is essentially zero. The whole coal argument is merely a distraction. We know the grid has to get cleaner, we expect it to, we see that it already is with more NG, wind, and solar, and as it does EV's get even cleaner as well. Focusing only on the coal scenario is basically saying EV's are no better than ICE's, can never be better than ICE's, so why bother? Does it matter that in the worst case scenario, 100% coal charging, and with the temporary vampire loads, a Model S might have similar CO2 emissions as a 20mpg ICE? (And how many other luxury performance sedans at the S level do better than 20mpg anyway?)

 

[Nicu.Mihalache]

And if it's wind, solar, or hydro charged the CO2 is essentially zero. The whole coal argument is merely a distraction. We know the grid has to get cleaner, we expect it to, we see that it already is with more NG, wind, and solar, and as it does EV's get even cleaner as well. Focusing only on the coal scenario is basically saying EV's are no better than ICE's, can never be better than ICE's, so why bother? Does it matter that in the worst case scenario, 100% coal charging, and with the temporary vampire loads, a Model S might have similar CO2 emissions as a 20mpg ICE? (And how many other luxury performance sedans at the S level do better than 20mpg anyway?)

That's exactly the daydream type approach to investing I was suggesting we should avoid. I hope you are simply an EV enthusiast and not a TSLA investor. Otherwise, best of luck to you!

 

[Zythryn]

That's exactly the daydream type approach to investing I was suggesting we should avoid. I hope you are simply an EV enthusiast and not a TSLA investor. Otherwise, best of luck to you!

Nicu, you can't fault his statement when yours uses exactly the same logic in reverse.
You took one isolated example over a short timeframe.

I invest based on the big picture. So I won't do so based on either your example or his.
And frankly, how much CO2 an EV puts out is largely irrelevant for investing in this case.
The car is phenomenal, and is attractive on performance, technology, national security, national fiscal health and as an average environmental concerns. Take out any one of those and the car will still sell.

 

[JRP3]

That's exactly the daydream type approach to investing I was suggesting we should avoid. I hope you are simply an EV enthusiast and not a TSLA investor. Otherwise, best of luck to you!

Wow, you really have morphed into Petersen Jr. Did he hack your account? My statement has nothing at all to do with investing, it does have everything to do with the way I see things heading in the future. My point was that your narrow emissions scenario has nothing at all to do with Tesla as a company or the Model S as a product. The fact is that plenty of people buy the S with little to no importance put on it's emissions profile. Even those who do probably don't analyze it as closely as we have. Yes I'm an EV enthusiast and a TSLA investor. I think my knowledge of the technology and the company gives me an advantage over the average investor. If you think the future of TSLA is affected by the current CO2 profile when charged from 100% coal then I hope you are not a TSLA investor.

 

[ItsNotAboutTheMoney]

Here is another real world measurement from a Model S owner (hopefully those numbers will improve with software updated and maybe even more efficient wall charger and even on-board chargers for new cars):
http://www.teslamotors.com/forum/forums/model-s-equivalent-mile-gallon-closer-60-empg#new

511 Wh / mile including charger loss, vampire loads and everything else. This means that the equivalent coal CO2 mpg drops around 20 mpg. Of course this is relative, in France we are closer to 40g of CO2 per kWh, an order of magnitude less than the US average and about 20x less than pure coal.

Do note:
- That figure was during a winter month in NY when conditioning loads and driving use are higher than average.
- Tesla continues to work on reducing the vampire loads.
- Tesla is working on fixing problems with the low-drain sleep mode and anticipate it to be working correctly before the European models are sold.
- The major EV market states have lower-than-average CO2 emissions (for those buyers who really care).
- The US grid CO2 emissions average is decreasing as most new capacity is natural gas plus wind.

 

[Norbert]

As for the cost reducing in Li-ion batteries, most of them have been realized during the last two decades.

Huh? Your arguments don't provide a basis for what you say. Companies like Panasonic are making continuous improvements of about 7-10% / year. We had a definite improvement from the Roadster to the Model S (40-50%), and Elon recently talked about a similar improvement for the Gen III.

 

[Nicu.Mihalache]

Huh? Your arguments don't provide a basis for what you say. Companies like Panasonic are making continuous improvements of about 7-10% improvement / year. We had a definite improvement from the Roadster to the Model S (40-50%), and Elon recently talked about a similar improvement for the Gen III.

Yes, I agree there is 7-10% per year. And Elon said that we will have about 10% during the next 2-3 years, as he has inside info about the product pipeline from Panasonic. I was talking about "Moore law" improvements to 500 Wh / kg some people think will be here for Gen III (that would be more than 100% improvement at the pack level).

- - - Updated - - -

Wow, you really have morphed into Petersen Jr. Did he hack your account? My statement has nothing at all to do with investing, it does have everything to do with the way I see things heading in the future. My point was that your narrow emissions scenario has nothing at all to do with Tesla as a company or the Model S as a product. The fact is that plenty of people buy the S with little to no importance put on it's emissions profile. Even those who do probably don't analyze it as closely as we have. Yes I'm an EV enthusiast and a TSLA investor. I think my knowledge of the technology and the company gives me an advantage over the average investor. If you think the future of TSLA is affected by the current CO2 profile when charged from 100% coal then I hope you are not a TSLA investor.

If you check the board you are posting to, it says
"Tesla Motors Forum -> Tesla Motors -> TSLA Investor Discussions"
I did not want to imply CO2 has anything to do to the share price. It was an example that even what Tesla or Elon say, we have to verify / check to the best of our ability.

I am sure they know what are the price decrease limits / year, what are the supply challenges etc. But they are not going to stress those challenges in their communication, even with investors.

Gen III time frame is not only about the cash Tesla has to invest in the factory. And we should not be surprised if it slips another year, just as it did already, and just like Model X did too recently. The things Tesla are doing are so fantastic, that many understand that they are piece of cake. There are still huge challenges ahead, and Elon and Tesla are still humans operating in a given economic and physical space.

 

[JRP3]

Yes, I agree there is 7-10% per year. And Elon said that we will have about 10% during the next 2-3 years, as he has inside info about the product pipeline from Panasonic. I was talking about "Moore law" improvements to 500 Wh / kg some people think will be here for Gen III (that would be more than 100% improvement at the pack level).

Was anyone here talking about Moore's Law improvements? If so I missed it. However there are enough advanced research breakthroughs taking place at a never before seen pace that a 400-500 wh/kg cell level improvement by 2016 is not impossible.

If you check the board you are posting to, it says
"Tesla Motors Forum -> Tesla Motors -> TSLA Investor Discussions"

Indeed, and you are the one who brought up the off topic discussion of a specific scenario where a Model S may have higher emissions than some ICE's. Tesla made a general statement for marketing purposes, I think the requirement that it holds true in all imaginable conditions is unrealistic. I expect some spin from Tesla, as from all companies trying to put their product in the best light. I agree we should fact check them and call BS where necessary, but this is such a minor point that doesn't merit much discussion, yet here we are.

 

[hcsharp]

...
Two things that all TSLA investors have to keep in mind are:
- we tend to become over-bullish in those forums, via a closed feedback loop, most of the time because of mixed feelings about business / market on one side and product excellence and awesome Tesla people on the other side (believe me, I've been hit hard with AAPL, losing the equivalent of three loaded-up Model S on AAPL options last fall - not so unrelated story with what is happening now with Tesla: great product, great people, booming sales and such)
- the market can stay irrational longer than you can stay solvent and mentally sane; as luvb2b told us, shorts are playing dirty games, both in the market and the media - we are fighting against the most ferocious sharks out there - be careful

Well said. Thank you Nicu.
The oil industry and large auto manufacturers will not roll over easily. They (oil & gas) are easily the largest contributors to superpacs. What kind of pressure does that put on who gets elected?

Open an issue of The Economist, a weekly news magazine that I read. Probably inside the front or back cover will be an ad from BP. Or Chevron. Do you think they are trying to sell you gas? They spent two hundred thousand+ $$ for that inside-front-cover ad. Do you know anybody who ever bought anything because of those ads? Or believed the BS in the ad "we think oil co's should support the environment..."? With print publications on their knees begging to stay alive, what kind of pressure does that put on the editor to tell the truth about EVs?

I'm optimistic about TSLA, but please understand the over-bullish nature of this forum.

 

[Norbert]

Yes, I agree there is 7-10% per year. And Elon said that we will have about 10% during the next 2-3 years, as he has inside info about the product pipeline from Panasonic. I was talking about "Moore law" improvements to 500 Wh / kg some people think will be here for Gen III (that would be more than 100% improvement at the pack level).

OK, you seemed to refer to John Petersen who appeared to suggest (at the time I was reading some of his articles about batteries, a year or two ago) that there aren't likely to be any significant battery improvements at all, in the near future.

I did not want to imply CO2 has anything to do to the share price. It was an example that even what Tesla or Elon say, we have to verify / check to the best of our ability.

I'm pretty sure Elon's comparison with a theoretical 100% coal referred to a comparing theoretical long-tailpipe emissions with (short) tailpipe emissions, and were valid even without using the long-tailpipe emissions of gasoline, that also exist. In reality, in the US, coal has an average of about 35% to 39%, in electricity generation, since 2012. Before expanding the tailpipe discussion to the CO2 used in production, which is rare, one should use real numbers, not theoretical 100% numbers. So I think Elon is correct with that statement, in its proper context.

John Petersen's discussions of the CO2 used in production, in so far as I have seen them, are some of the ones I have the least trust in, and that says something in his case. They are certainly not Panasonic/Tesla specific. Which could make a big difference, as we have seen with Tesla's specific electric motors which don't use rare earth metals at all, those ingredient's which John Petersen made a lot of noise about, some time ago in "discussing" electric motors.

The 511 Wh/mile number, in its specific case, is due to temporary software changes which disable "sleep mode", as was said in that source. I think one should use the tested mpg-e number which includes charger efficiency. Otherwise, to be fair, you'd need to measure the real mpg for gasoline cars, as their real mpg is often much lower than the official number (and in so far as I know even the official numbers are a good bit lower than 28 mpg on average).

 

[Robert.Boston]

511 Wh / mile including charger loss, vampire loads and everything else. This means that the equivalent coal CO2 mpg drops around 20 mpg. Of course this is relative, in France we are closer to 40g of CO2 per kWh, an order of magnitude less than the US average and about 20x less than pure coal.

You're mixing apples and oranges there, Nicu:

• The "20 mpg" is an EPA rating, while the 511 Wh/mile is an actual. I think it's likely that most people, in real life, get worse mileage than the EPA rating -- certainly I did, given that most of my weekly driving is in horribly clogged urban roads.
• The MS invites people to drive with more verve than their ICE car. I would want to know what sort of mileage that 511 Wh/mile person would be getting driving, say, an Audi S6, and driving using the same style as the MS.

As others have noted, an "all-coal" scenario is simply not credible in any Tesla market except China. From an investor's POV, why does this matter? Not at all, except in the context of broader governmental policies. Any plausible long-term strategy to reduce carbon emissions must include shifting the transportation sector to lower-CO2 fuels, plus improving energy efficiency of vehicles. Similar policies drive grid power to become lower-carbon, too, through Renewable Portfolio Standards, feed-in tariffs, etc. Pairing these two policies, it is credible to believe that government policies will continue to support EV adoption.

Such pro-EV policies make an enormous difference to Tesla: contrast Sweden and Norway. Norway has the highest per-capita Model S reservations of any country. By the end of 2014, there will be more Model Ss in the Oslo area than in the SF Bay area. Sweden? Although similar to Norway in many ways, there are very few reservations there. The only material difference between these two Nordic neighbors is the suite of pro-EV policies.

 

[Citizen-T]

I wonder where JP is. Seems like we are about due for a "the wheels are about to come off" article with the run TSLA's had of late.