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Short-Term TSLA Price Movements - 2014

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#7,321
Please forgive my stupid questions.

In all these hypothetical calculations for the Gigafactory and Model 3 power needs, I am wondering why it is assumed that Model 3 will have less than 60 kWh for it's base battery. Isn't 60kWh still considered the minimum for Supercharger use, because of the tapering? It's also ~30% less than 85kWh, which was the max that could be stuffed into the Model S pack before probable improvements in energy density... So a 30% physically smaller pack is already implied there, before ED improvements.

So I guess my question is: Have I missed some new development in Supercharger tech that will allow smaller batteries to satisfy Tesla's definition of efficient fast charging (ratio of fast charge to taper)?

Perhaps speculation shouldn't be focused only on the stated minimum of 200 EPA mi./charge?

Or I've missed something somewhere. Or I'm even crazier than I thought I was...

Happy Monday!
 
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#7,322
GLDYLX said:
Isn't 60kWh still considered the minimum for Supercharger use, because of the tapering?
Click to expand...

Probably best asked on a different thread than this, but...

Perhaps Tesla will offer 40kWh as a way to meet their original goal of $35,000. This would be OK for people who don't visit Superchargers very often, like those who stay in town and rarely go on long distance road trips.

Or perhaps the "stripper" 40kWh car will be even less than $35,000 in order to get more people into the brand! Remember, Tesla want to eliminate gas-burning cars as fast as possible.
 
#7,325
chickensevil said:
I know this is a bit late, for reflecting the price movements, but since it is a value to the short term movements... Here is the video of the Japan market release: Elon Musk on Tesla Model S in Japan, Toyota Partnership: Video - Bloomberg

For those who can't watch the video, or just want the highlights here you go... This was a REALLY GREAT INTERVIEW. So much juicy details!!!

They are rolling full steam ahead with supercharging in Japan and that was part of the delay. They wanted at least some superchargers online in Japan before going live, which he said they have 2 of them online now.

Multiple partners in the factory: Panasonic and their partners (Hitachi and SMM - Sumitomo Metal Mining) So you have first confirmation of at least two other partners :D

Enough sun in Japan to power Japan completely by solar and many times over.

Tesla will be providing half of the investment, Panasonic is 30-40%, and the remainder will come from the other industrial partners and the State of Nevada. Panasonic, Tesla, and Nevada are all on board, so the only remaining piece is to get the other industrial partners to sign on (So sounds like Hitachi and SMM are in the works, but not yet finalized on what they will contribute?)

Not putting a lot of thought on anything outside of the main car and battery factory. However long term (3-5 years) they will look to establish other factories where they are needed. Outside of his statement right there, no additional planning has been done on future factories (so we can stop that speculation I guess, lol)

Daimler, Panasonic, and Toyota investments were critical to the survival of Tesla

"Fuel Cells are not the right solution, but I think there is some value with experimenting with other technologies." He goes on to say more about why it isn't great that is pretty much all the reasons we have heard already.

Goals of SpaceX is very long term, which is outside of the timeframe of an analyst on Wall Street, SpaceX is not going public any time soon. Tesla was probably taken public too early as well, but they needed a lot of money so they went public (Thanks Elon!)

The earth is already mostly solar powered and the amount we need to run civilization is only a fraction of that energy. But he is very pro Hydro, Geothermal, wind, anything that is renewable. He is also not opposed to Nuclear it just needs to be well thought out. (He then gave a very nice answer about Japan and their Nuclear situation)

What is the timeframe to getting vehicles equipped with autopilot? (wanted to frame the question for the answer he gave) In the past he said 10 years before full autonomous and will update to 5-6 years. Regulatory approval is part of this timeframe.

In about a week he is giving a presentation on upcoming features of the model S firmware. (ZOMG!! I can't wait for this!)

There will probably be something significant of a much higher volume deal with Toyota in a few years (just a guess).

Output of the factory will be 2/3rds for Tesla cars and 1/3 for stationary storage and other manufacturers.

Patent release was just to accelerate EV adoption... it might be a bad idea in the future, and he hopes it won't be a dumb decision. all patents do is slow down competitors. True strength of Tesla will be decided by its innovation, and if they are great then they won't need to worry about selling their cars.

They do have the option of slowing down investments and R&D and would be profitable if they did that, they have chosen the path of high growth over the path of profitability. There is no special class of common stock... He only has ~25% of the shares, if investors thinks he is doing a bad job there is a simple solution and that is they could fire him. (Such a great response about being profitable vs high growth :D )
Click to expand...

When was this posted by Bloomberg????

When did/will it affect the market?????
 
#7,326
One thing to keep in mind about the Gigafactory is that most of it, the equipment, will be a short term investment. Last week Tesla revealed the the of the initial $5B investment, $1B is for the building and $4B for the equipment. Moreover, another $5B will be spent on equipment replacement over the first 10 years. This is about $1B in equipment every year at 50 GWh capacity, or $20 per kWh. Naturally the building should be good for 20 years or more, for 1000 GWh of final product. So that is a cost of about $1 per kWh. Clearly the equipment cost is a much bigger driver of unit cost than the plant itself. Apparently equipment will have a useful life of about 5 years. Thus, it is critical that payback happen quickly, within just a year or two. Additionally, it is helpful to understand that Tesla will have flexibility about how quickly it installs and upgrades equipment. If every month Tesla were to install, say $80M worth of equipment, it would be able to view that as a small, discrete investment. That particular line could be configured for any particular product it wants most to produce over the next 5 years. So for example, if Tesla was negotiation a deal with Toyota, it could build out the specific configuration needed and write the contract for a 5 year term. At the end of that term, the lines could be upgraded to meet whatever is needed at that time. If the equipment is installed over say a 5 year time frame, by the time the last lines get installed, the first lines are now 5 years old and ready to be replaced. This approach gives Tesla flexibility to install whatever technology is needed over the next 5 years as it is needed and becomes available. Such a factory is constantly upgrading it's technology, which would fit the Tesla way. Additionally, there is some flexibility over the pace of installation. Suppose demand growth slowed, then Tesla could simply slow the rate of installing new equipment. On the other hand, if demand accelerated, then the rate of installation could speed up for a while. However, too much acceleration could fill up a plant too fast. So it would be beneficial to open up more plant to open more room to run. A single plant gives you linear growth over say 5 years, but opening new plants periodically gives you quadratic growth potential. It seems sensible to me to start one new Gigafactory every 12 to 24 months and to ramp each of these up over a 4 to 5 year time frame. This is the sort of thing needed to approximate exponential growth over the next 10 to 20 years. When there are multiple Gigafactories open for ramp up, this will put Tesla in the driver's seat to control how quickly it adds capacity. Without this capability, Tesla is stuck trying to get Panasonic or other suppliers to move at Tesla's desired pace. With this flexibility, suppliers try to keep up or Tesla orders more equipment as needed. So the advantages here are not just cost cutting, but the capability to scale production with growth in demand. Let's keep in mind that 95% of the Gigafactory is just a series of short, 5 year investments. Managing cash flow is what will make explosive grow feasible.

Edit. Note also that the value of the NV tax incentives is about $1.25B over 20 years. This coincides with the cost of the plant ($1B) plus maintenance and interest over 20 years. So basically NV has covered the cost of the plant. Investors are on the hook for the cost of the equipment which has a 5 year time horizon.

Moderators, I'd be happy to have this Gigafacoty discussion moved to the Gigafactory thread. My aim in raising these issues here was to encourage us to digest information that was recently released in Nevada. This thread becameso caught up in the price run up and Musk's gaffe that no one seemed to have any focus on what suble information had just been released. We should be constantly peicing together new information and not lose our heads in emotional reactions. So i encourage all of us to mine the info released in Nevada. It reveals alot about the economics of the Gigafactory. IMO, this info should embolden investors to continue the current run up in price.
 
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#7,328
Jackl1956 said:
When was this posted by Bloomberg????

When did/will it affect the market?????
Click to expand...

The interview happened well before the market opened and I didn't find it until just before the market closed... This interview likely contributed strongly to the large jump up this morning, just a guess. Which is why the stock recovered from its depressed state, again just a guess.

That was why I apologized for it being very late to help act on any of the data provided there but it was valuable data all the same and does give explanation for today's price movement.

That all being said, it is likely this information will take a while to spread since it did happen in Japan and we might see the affects of this for a couple days... Just another guess.
 
#7,329
ckessel said:
ZOMG! Did Elon retract his statement? The stock is right back to where it was near the end of day Thursday!

(that's sarcasm, in case someone missed it...)
Click to expand...

I don't think you understand what you're saying. The fact that it's up today proves exactly my point. Tesla should have been up like this on Friday after the awesome GF announcement. But since Tesla is so news driven, something that might not seem like a big deal to some (ie. Elon's over priced comment), can actually cause a sell off which it did.
 
#7,330
chickensevil said:
The interview happened well before the market opened and I didn't find it until just before the market closed... This interview likely contributed strongly to the large jump up this morning, just a guess. Which is why the stock recovered from its depressed state, again just a guess.

That was why I apologized for it being very late to help act on any of the data provided there but it was valuable data all the same and does give explanation for today's price movement.

That all being said, it is likely this information will take a while to spread since it did happen in Japan and we might see the affects of this for a couple days... Just another guess.
Click to expand...

Interestingly, many of the headlines yesterday focused on the potential Tesla Toyota relationship, but the articles did not cover many of the details covered in Elon's interview. Maybe it WILL take a day or two to sink in.
 
#7,332
Jackl1956 said:
Interestingly, many of the headlines yesterday focused on the potential Tesla Toyota relationship, but the articles did not cover many of the details covered in Elon's interview. Maybe it WILL take a day or two to sink in.
Click to expand...

Yeah, that was my thinking, because we heard about the Japan deliveries, and we heard about the Tesla/Toyota stuff, the autopilot comments, and even the fuel cell stuff, but that was about it. All the rest of the comments and responses to questions were not even whispered about elsewhere that I saw.

I feel like if Nevada moves and signs the deal this week, we will certainly be ripe for a bunch of analyst upgrades that have been overdue. Plus the hope that he will actually hold an event/press conference in about a weeks timeframe to discuss changes coming down to the firmware... and I think we still have another couple weeks of positive news coming down the pipe to drive the stock price up.

Anyone riding this wave, I am still cautious about Q3 and still want to mostly avoid trading in Oct/Nov until we get a glimpse of the other side of earnings. But Sept is looking to be quite the wave.

- - - Updated - - -

Derek Vinyard said:
don't know whether you have already read this article (ok, most of you guys are probably still sleeping:wink:).
It's interesting to see some pros and cons here.

http://www.lasvegassun.com/news/2014/sep/09/what-makes-nevadas-special-session-tesla-so-specia/
Click to expand...

Wow, from the lobbying side of this deal, you clearly have the Nevada Manufacturers Association (http://nvmanufacturers.org/) on their side. It seems that NFADA is not complaining even though the deal would make an exception to any 100% EV manufacturer to sell in the state directly (if they don't already have a franchise in the state, which, is what the original intent behind the law actually was...) There is the Alliance of Automobile Manufacturing who is still reviewing the deal, but why should they make a fuss? They have been a pretty pro-green group (from what I can tell).

So overall, there shouldn't be a lot of pushback from any special interest lobby group.

I can see other parts of the state that are not directly impacted by this deal giving pushback, as the article suggests, but hopefully it won't be enough to cause any problems. I can't believe Las Vegas is complaining about this deal not helping them... That has to be one of the better off areas in that state, since just about anyone going to Nevada for a visit is going to go to Vegas. You have the hotspot for tourism... you can't have everything...
 
#7,333
chickensevil said:
Wow, from the lobbying side of this deal, you clearly have the Nevada Manufacturers Association (Nevada Manufacturers Association | Just another WordPress site) on their side. It seems that NFADA is not complaining even though the deal would make an exception to any 100% EV manufacturer to sell in the state directly (if they don't already have a franchise in the state, which, is what the original intent behind the law actually was...) There is the Alliance of Automobile Manufacturing who is still reviewing the deal, but why should they make a fuss? They have been a pretty pro-green group (from what I can tell).

So overall, there shouldn't be a lot of pushback from any special interest lobby group.

I can see other parts of the state that are not directly impacted by this deal giving pushback, as the article suggests, but hopefully it won't be enough to cause any problems. I can't believe Las Vegas is complaining about this deal not helping them... That has to be one of the better off areas in that state, since just about anyone going to Nevada for a visit is going to go to Vegas. You have the hotspot for tourism... you can't have everything...
Click to expand...

Thanks for the clarification particularly with regards to Alliance of Automobile Manufacturing. Didn't know they are "green"-focused. Great.

What I like in the articile is this sentence: "No one expects the Legislature to vote down the deal.":cool:
 
#7,335
Derek Vinyard said:
Thanks for the clarification particularly with regards to Alliance of Automobile Manufacturing. Didn't know they are "green"-focused. Great.

What I like in the articile is this sentence: "No one expects the Legislature to vote down the deal.":cool:
Click to expand...

Well, I think they just want more auto manufacturing... I don't think they care how it happens. So whatever causes people to buy more new cars which in turn means a higher need for new manufacturing, and if it is happening here in the US? They will likely be for it.

I just know that they were part of the lobby to extend the green tags in CA to allow for more hybrids to be registered with them, and I think it also extends the rebates for hybrids in CA as well. Not from CA so someone feel free to chime in and correct me on that one if I got it wrong.

But yeah, even those that seem hesitant about the deal are leaning toward voting for it, they just have their concerns. Hopefully we will know more tomorrow.
 
#7,336
chickensevil said:
I can see other parts of the state that are not directly impacted by this deal giving pushback, as the article suggests, but hopefully it won't be enough to cause any problems. I can't believe Las Vegas is complaining about this deal not helping them... That has to be one of the better off areas in that state, since just about anyone going to Nevada for a visit is going to go to Vegas. You have the hotspot for tourism... you can't have everything...
Click to expand...

Even though the deal with increase tourism dollars spent in Reno, it still helps Vegas residents. There is no personal income tax in Nevada because gaming taxes make up for it. Smart Nevadans will be glad the coffers are being kept full, regardless of where in the state the money is flowing.
 
#7,337
justdoit said:
I don't think you understand what you're saying. The fact that it's up today proves exactly my point. Tesla should have been up like this on Friday after the awesome GF announcement. But since Tesla is so news driven, something that might not seem like a big deal to some (ie. Elon's over priced comment), can actually cause a sell off which it did.
Click to expand...
So, you're up in arms about Elon's remarks that may or may not have had anything to do with a transitory 1 day blip in price?
 
#7,338
This isn't even as scientific as unicorns, but I have always used Google Trends as one barometer as to the 'hype' over TSLA. Here is the 1 year graph:

http://www.google.com/trends/explore#q=tsla&date=today 12-m&cmpt=q

Here we are touching all-time highs for the stock, yet interest in TSLA on Google is at a 12-month low. Note the trend high was associated with the runup of the stock back in late February/early March. There was also a spike in Oct of 2013, associated with the f*res.

My point here is that every major move in the stock has been associated with increased interest in TSLA on Google.....except the current one. Of course, negative news associated with unforeseen events will always result in the stock decrease and increased interest on Google, however I don't believe that the current runup is associated with 'hype'.
 
#7,339
The problem with the trending based on a percentage of interest like Google does, is your timeline really impacts the percentage of interest. Take a look at their all-time chart:

interest over time.PNG


You can see that interest is actually on the rise although the last peak was still during the previous run up to 265 back in Feb/Mar
 
#7,340
chickensevil said:
The problem with the trending based on a percentage of interest like Google does, is your timeline really impacts the percentage of interest. Take a look at their all-time chart:

View attachment 58691

You can see that interest is actually on the rise although the last peak was still during the previous run up to 265 back in Feb/Mar
Click to expand...

Of course. Before the spring of 2013, TSLA wasn't on anyone's map. I'm talking about recent history.
 
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