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IHS is embarking on a complete tear-down of Model S with a goal to have a comprehensive BIll of Materials and estimated cost structure of the car. They are quite impressed with innovation observed during the first tear-down stage: instrument cluster and head display unit.
Ironically, this is the same outlet that projected TM to built 1,500 cars in 2013, getting TM in trouble with suppliers. Apparently the suppliers ignored their contracts with TM that required parts for 20K cars, because the IHS produced estimate that TM will built only 1.5K cars. Elon was commenting on this in disbelief during one of the ER calls in 2013.
Good of to know that IHS is doing real home work this time around. Just another reminder of the TM's record of unprecedented achievements.
http://www.streetinsider.com/SI+Newswire/Is+it+a+Car+or+an+iPad%3F+/9906767.html
Ironically, this is the same outlet that projected TM to built 1,500 cars in 2013, getting TM in trouble with suppliers. Apparently the suppliers ignored their contracts with TM that required parts for 20K cars, because the IHS produced estimate that TM will built only 1.5K cars. Elon was commenting on this in disbelief during one of the ER calls in 2013.
Good of to know that IHS is doing real home work this time around. Just another reminder of the TM's record of unprecedented achievements.
http://www.streetinsider.com/SI+Newswire/Is+it+a+Car+or+an+iPad%3F+/9906767.html
chickensevil
Active Member
Looks like pre-market we are going to be up. I hope we can get a solid climb back to 235 today so we can sit safely away from the 200 day.
In my opinion this one is easy to answer.
First, Elon is obsessed with making every little detail "right", i.e. as "perfect" as possible. This is also the argument he has consistently brought up to explain the delays, and I trust him.
Second, in the very moment they will show the beta version (which is supposed to have the final production version design - it will look just great for sure), mounting of reservations will accelerate even further. This in turn translates to even more people having to wait for more than 12-18 months to actually get that Model X. Keep in mind that the whole 2015 X production is already "sold out". So, if you reserve now, you'll get your X in Q2 2016 (or Q1 if you're lucky). So, for TM, it's pretty wise to anti-sell the X and concentrate their marketing efforts on the product they can deliver within 3-6 months, or even faster (e.g. used CPO cars).
To sum up, it just doesn't make sense to show off the X yet. And as an investor, I'm pretty content they don't, and that instead, they focus on improving an already outstanding product (the S) and on selling it to more and more customers around the globe in ever more markets. Thereby they keep on a) getting more visibility across the globe as a brand and a tech/car company, and b) expanding future customer base for Model 3 as well as stationary storage.
Just to continue this one I really don't think the X will be shown until Q1 now. Reveal the X and some people might hold off on ordering one of the D variants. I would bet good money the X Beta is planned to be unveiled shortly before or during the Detroit Auto Show. To be clear I don't think it will be unveiled at the show, I think Tesla will keep unveilings in Hawthorne.
There is a common bear thesis that Tesla is not production constrained. Ok, stop laughing, I know, I know, but "bear" with me. The European numbers are down. Pretty much any reliable available Model S sales information is down, so we are left with speculating on markets where no reliable information exists. Further, the factory shutdown by several reports took longer than expected and Tesla worked really hard to bring their production numbers back. There is the report that there are two few Model S's registered in China, possibly due to the sales tax rebate issue. They think Musk and Tesla are lying about demand and delivery numbers. They can't understand the overhang of deliveries in various stages of transport between each quarter. With oil down, with the market down, its easy to bring down a high flyer like TSLA. The October 9th event pre-announcement arrested the downslide for a week much to their dismay. The risk for them was that Tesla was going to announce something that would bring unit sales projections up, like a Model X/3 related announcement. We did not get that, and hence the downslide resumed.
So the question becomes, what if Tesla barely makes guidance in deliveries? What if Tesla was not non-GAAP profitable? To me, those are the real short term risks. In that scenario, the bears might even think that the factory shutdown and expansion was all a hoax to cover the lack of demand issue. What would Tesla's stock price be at in the worst case scenario there?
Even if that scenario does not come to pass, I think we are weak going into Q3 ER because of that risk. Of course, I think that Q4 will be terrific with a rising ASP and that Tesla will sell each and every car they make. In my ideal scenario, this is a bear trap with a trading pattern much like Q1, where we hit 180 and then climbed out of it.
As a reminder, I'm talking about short term moves that should not spook a long term investor.
So the question becomes, what if Tesla barely makes guidance in deliveries? What if Tesla was not non-GAAP profitable? To me, those are the real short term risks. In that scenario, the bears might even think that the factory shutdown and expansion was all a hoax to cover the lack of demand issue. What would Tesla's stock price be at in the worst case scenario there?
Even if that scenario does not come to pass, I think we are weak going into Q3 ER because of that risk. Of course, I think that Q4 will be terrific with a rising ASP and that Tesla will sell each and every car they make. In my ideal scenario, this is a bear trap with a trading pattern much like Q1, where we hit 180 and then climbed out of it.
As a reminder, I'm talking about short term moves that should not spook a long term investor.
Chickenlittle
Banned
I do not accept your premise of decreased demand. If true than why no advertising yet????
Not my premise. But it is a common bear thesis. The whole "peaked U.S. deliveries" scenario that Tesla burned through the early adopters in the U.S. and went searching for demand elsewhere. Repeat in each new market, where Tesla has a bump in new deliveries but then slides. It depends on assuming that Tesla is not production constrained and the bears have to go through a lot of contortions to try to show that to be true. But with a stock as high as Tesla's, the perception that it might be true is enough to cause the kind of volatility that we have seen.
The Blue Owl
Endangerous Herbivore
The way I understood techmaven's post, that premise isn't his. It's the bears' premise. I find his explanation of the drop quite plausible, and I share his concern regarding Q3, not because of "lack of demand" or because "Tesla is lying", which no one here believes, but because if this is a widely held belief among the many human trading bots out there, we may get another buying opportunity after Q3 (to put it positively.)
Thanks for these updates, Derek!
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Chickensevil: Techmaven is wisely analyzing the bear theses / FUD out there to ascertain "what the other side is thinking." It's basically pipe dreams that fly in the face of facts, but that doesn't stop the market from trading on this false or misleading information, so it's wise to know as much as we can about the scope of opinions out there, credible or no.
anticitizen13.7
Not posting at TMC after 9/17/2018
I agree. I'd also add that Tesla is selling every Model S they can build. Without a demand problem, Tesla has no reason to rush a new product out the factory doors.
The addition of Dual Motor Model S makes a hot selling car even more desirable. I'm impatient for Model X, but I can see why Tesla is taking its time with development.
Krugerrand
Meow
This was answered recently by the man himself. Paraphrased: We are no longer going to be showing our hand.
chickensevil
Active Member
wrong chicken, I am really contemplating changing my name just to avoid this -_-
Whoops, sorry!
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We're tracking QQQ, as I'm sure you know. I don't view much of this as TSLA-specific movement.
chickensevil
Active Member
Haha! No worries. I agree with the assessment about the bear trap. Short data has been continually dropping until just the last release. So if we get them to pile back in now, because they think that the "house of cards is about to fall" then I am fine with that. They are out in full force with their needles trying to make the "bubble" pop, and the more we resist dropping below the 200SMA the more they will likely try to drop it down. Hopefully ending with a decent jump in short volume just in time for some really good news to start to fall into place.
About the Model X, I still think we will see it hit before Q1 simply because I think they are going to start the first few deliveries in Q1 to those whose names end in Musk or Jurvetson (and maybe Bonnie
)I do agree that I think we will see the Model X at Detroit simply because there is no reason not to show it off there at that point.
I also feel like either in Q4 or Q1 we will finally get our first glimpse of the Model 3. That will certainly not happen until the show off the Beta Model X, but I don't think they will wait forever to show it off simply because that is how the auto market works... you get the concept cars out there about 3 years before release. And if they can get a good idea about Model 3 demand now then maybe we could see them push for a second factory quite a bit sooner than 2017/18.
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Yeah, it does help reminding people about this. The only point where we will push against the Nasdaq is when we hit that support level at ~221 and below. Otherwise absent of news we are likely to keep following the broader market movements.
Yes, I should have stressed that, too. I'm also quite confident that TM can easily drive up demand at will, as Elon stated. It's kind of staggering that the merchants of doubt on that front seem to have an impact on some investors...
With regards to the short-term outlook: The FUD will continue - no doubt about that. The question is: How many investors will chime with that or get cold feet or just use the opportunity to ride the rollercoaster up and down...
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