Short-Term TSLA Price Movements - 2015

[bonaire]

Lot of people ordered their Ds from October onward. Do you guys think that backlog will be drawn down now that both P85D and S85D are being built now? The 85D was held back somewhat until early February. What will happen once the backlog is close to drawn down? What we never know is how many incoming orders there are per month versus outgoing.

Leaf sales may drop a few hundred per month due to the Georgia changes - they were rebating 2-year leases, which is crazy. Like getting a free car.

 

[jhm]

It looks like the $5k incentive is gone. Same Rep that sponsored the "Tesla" bill sponsored the amendment to get rid of the BEV incentive.

We shall see how LEAF sales hold up without $5k incentive and lease deals that are "almost free" when gasoline savings are considered.

Same thing may happen in Texas. Tesla in Texas officially open for business once Texas State incentive is gone.

Movement a foot in California State Legislature to limit BEV incentives to vehicles that cost less than $40k.

Wow, I'm glad I bought my Tesla just in time. The streets around here are full of LEAFs, but I guess that will level off a bit. I don't think it will make much of a difference for Tesla, but will hurt Nissan.

The proposal in CA to limit the tax break to cars under $40k a bit nasty to single out Tesla and BMW. I'd like to see Tesla to explore a subscription based pricing plan to squeeze the front end down. This could get around the $40k threshold and would be attractive to some buyers. Also in a state like GA we have an ad valorum annual vehicle tax. Each year I get taxed on the front end cost of the vehicle. A subscription priing model would minimize my ad valorum tax. Remember that a $25k car becomes a $50k car if you front load all the gas, and that is not the way to market cars.

 

[ggies07]

It looks like the $5k incentive is gone. Same Rep that sponsored the "Tesla" bill sponsored the amendment to get rid of the BEV incentive.

We shall see how LEAF sales hold up without $5k incentive and lease deals that are "almost free" when gasoline savings are considered.

Same thing may happen in Texas. Tesla in Texas officially open for business once Texas State incentive is gone.

Movement a foot in California State Legislature to limit BEV incentives to vehicles that cost less than $40k.

Not good. I'm sorry, but until EVs get down to the 25-20 mark, we need some savings in the price to keep the transition going.

 

[FANGO]

Do you have any confirmation of incentives going away? People have been talking about that for years but I haven't seen it happen yet. Same with the limit in ca.

Also, whenever people complain about EV incentives I complain about gas incentives. Each gallon of gas does about 4 dollars worth of health and environmental damage according to a recent study, so that is a massive five digit subsidy over the lifetime of any gas car. Eliminate that subsidy and we can talk about eliminating the EV one.

 

[AlMc]

There are a number of states that have no EV incentives, like Delaware. For me personally the $7,500 federal tax credit was incentive for me to 'upgrade' from a 60 to an 85. It had no effect on my decision to buy a Tesla.

I don't believe saving$2,500-5,000 on a 100K car is the 'make or break' issue. Now, for a Leaf, Bolt or model 3 mainstream buyer it could.

 

[maoing]

Agreed. It's particularly important to monitor the backlog in Q3 by end of Q2. Without sufficient (3-4 months wait time) S backlog, there has the risk to see dismay Q3/Q4 financials with introduction of X. IMO X and S share more similarity than other car company's SUV and Sedan.

I am expecting Elon to play the demand card (related to dealers) in April. Here is my reasoning.

Since Model X is due anytime in 3-q, there is going to be anxiety among new buyers whether to wait to see what it is or to order a new Model S. Look what happened with China where people cancelled orders (with deposits gone) once P85D was announced. Even though people here say Model X is a different category, and it is, I feel that there will be anxiety for some people to want to know more about X before they commit to X or S. This will slow down new reservations in coming months and Elon may use his card to counter that.

 

[AlMc]

Agreed. It's particularly important to monitor the backlog in Q3 by end of Q2. Without sufficient (3-4 months wait time) S backlog, there has the risk to see dismay Q3/Q4 financials with introduction of X. IMO X and S share more similarity than other car company's SUV and Sedan.

I just wonder how much the 'Osborne effect' is influencing potential buyers. TM is innovating firmware and hardware so fast that people may be just waiting for the next innovation to buy.

 

[brkaus]

I just wonder how much the 'Osborne effect' is influencing potential buyers. TM is innovating firmware and hardware so fast that people may be just waiting for the next innovation to buy.

Me

 

[Papafox]

Agreed. It's particularly important to monitor the backlog in Q3 by end of Q2. Without sufficient (3-4 months wait time) S backlog, there has the risk to see dismay Q3/Q4 financials with introduction of X. IMO X and S share more similarity than other car company's SUV and Sedan.

The timing of introducing cool features can certainly influence when a person seeks delivery. Take, for instance, the new ocean blue and titanium colors. They're coming, and some buyers are holding off their delivery dates or holding short of placing their orders until these colors become available. On the other hand, the current cars already have the hardware for autonomous highway driving, and when the software is introduced this summer, reviews of this new feature are likely to bring about additional car orders. I think Tesla shares our concerns and is making a point to keep the summer lively in terms of sales and deliveries.

- - - Updated - - -

I just wonder how much the 'Osborne effect' is influencing potential buyers. TM is innovating firmware and hardware so fast that people may be just waiting for the next innovation to buy.

My guess is that the autonomous driving features are such a huge leap forward that when the software is updated this summer potential buyers will be willing to pull the trigger at that time. They may have to see the cool software/hardware in action before the promise of this technology becomes real in their minds.

 

[CALGARYARSENAL]

Jim Cramer of CNBC really has it out for Tesla. I was on the road all day listening to CNBC on Sirius Radio and the amount of negative Tesla news was almost laughable. Traders want this thing to go to 177. Get it over with already. They can do that in a day. I could care less being a long term holder. In fact, I should be able to scrape some more funds together to buy the dip. Cramer sure does hold a grudge. He didn't like Elon joking about his Bear Sterns buy recommendation back during the crash.

 

[anticitizen13.7]

I think the forum is quiet because all of us are bleeding on the floor.

Short term traders are likely not doing well, and won't do well absent some intelligence here that other market players don't have. For this very reason, I do not conduct short term trades or post at all in the short term trading thread.

It's actually getting quite annoying. There's nothing wrong with the company yet down in the red more often than not.

This is why I think the short term game is generally unwise. At short time intervals, market movements are often random and unpredictable.

I've analogized this to physics: at large scale, things seem predictable, like the orbits of planets and the slight bend of light around massive objects. At the subatomic level, all of this goes to pieces.

 

[sub]

Jan-Feb, registration 469+260=729, imports 73. It's very likely the gap between registration and imports could be ~1000 in Q1, that should be counted as inventory sales and it would be the surprise to Q1 ER.

I read the article earlier today and unless i'm mistaken it quoted "registrations" not sales. It then suggested that these are some of the cars that the early scalpers bought and are slowly selling. If this is true, it would mean that what you said above is not true because tesla would have already recorded these sales in prior qtrs. I do however hope you are right and I am wrong.

 

[Gerasimental]

I read the article earlier today and unless i'm mistaken it quoted "registrations" not sales. It then suggested that these are some of the cars that the early scalpers bought and are slowly selling. If this is true, it would mean that what you said above is not true because tesla would have already recorded these sales in prior qtrs. I do however hope you are right and I am wrong.

I wonder how many of them they plan to sell and how many they will try to use as SC showcars, loaners, and test drivers. Also does anybody know how they are selling them? Considering they're not made to any actual customers' order, are they just being sold through stores to people like in conventional dealerships?

 

[aznt1217]

I read the article earlier today and unless i'm mistaken it quoted "registrations" not sales. It then suggested that these are some of the cars that the early scalpers bought and are slowly selling. If this is true, it would mean that what you said above is not true because tesla would have already recorded these sales in prior qtrs. I do however hope you are right and I am wrong.

It's a little tricky because the numbers used are A. outdated and B. build in time lag.

Tesla made it pretty clear that a delivery is when the customer gets it in their hands and makes full payment. What Maoing is saying is that there are cars that were just sitting there from cancelled reservations (once the D was released) or that scalpers didn't want it who just ate the deposit fee so these would not have been counted. These cars that were cancelled in Q4 would be sold in Q1 (discount or not).

The problem here is this "pro analyst" is associated registrations as demand which is a complete oversight in a supply constrained environment. China is especially complicated because you deal with shipment allocation, shipment delay, and customs... so it's really difficult to make any assertions on this market.

 

[dha]

What Maoing is saying is that there are cars that were just sitting there from cancelled reservations (once the D was released) or that scalpers didn't want it who just ate the deposit fee so these would not have been counted. These cars that were cancelled in Q4 would be sold in Q1 (discount or not).

I have a feeling that this is precisely what's going on. It also jibes with Elon's comments last week that "China is on the upswing."

I'm increasingly confident of a healthy upside surprise for Q1.

 

[aznt1217]

I have a feeling that this is precisely what's going on. It also jibes with Elon's comments last week that "China is on the upswing."

I'm increasingly confident of a healthy upside surprise for Q1.

I'm pretty sure what Elon was referring to is related to reservations and not deliveries. The reservation quantity and velocity is what real demand is. Unfortunately those numbers were only given to us once on the FY14 call.

With the short statistics being what they are and the number of catalysts there are... The spring is loaded.

Also I've been accused by many friends as extremely positively biased. Of course this is true but there's a difference in saying TSLA will be 2000 tomorrow and sheer stupidity that might deter a future long term investor or person who is easily swayed which is what is happening right now with the continuous misconception of demand.

 

[jhm]

http://www.avafin.com/articles/1042562.html
High put/call ratio today could be symptomatic of a hard to borrow situation for shorts. When shorts find it hard to borrow shares, they may turn to options for synthetic short positions. In the extreme this can lead to a breakdown of put call parity, which gives longs an opportunity to construct a synthetic long (buy a call and sell a put at the same strike) at a discount to the share price. Watch for implied volatilities on puts to exceed that on calls at the same strike.

This was the sort of thing that happened two years ago as the stock price exploded. Shorts could not continue to suppress the price because shares were too hard to borrow. Shorts turning to options were paying a premium for synthetic short positions. Eventually they run out of money paying rent.

 

[sundaymorning]

Short term traders are likely not doing well, and won't do well absent some intelligence here that other market players don't have. For this very reason, I do not conduct short term trades or post at all in the short term trading thread.




This is why I think the short term game is generally unwise. At short time intervals, market movements are often random and unpredictable.

I've analogized this to physics: at large scale, things seem predictable, like the orbits of planets and the slight bend of light around massive objects. At the subatomic level, all of this goes to pieces.

I honestly don't mind tsla being a bit down, it buys me more time to accumulate. We all know where this stock is headed...

 

[drinkerofkoolaid]

Jim Cramer of CNBC really has it out for Tesla. I was on the road all day listening to CNBC on Sirius Radio and the amount of negative Tesla news was almost laughable. Traders want this thing to go to 177. Get it over with already. They can do that in a day. I could care less being a long term holder. In fact, I should be able to scrape some more funds together to buy the dip. Cramer sure does hold a grudge. He didn't like Elon joking about his Bear Sterns buy recommendation back during the crash.

Cramer owns or owned a Model S but is supposedly bearish. (A while back Cramer mentioned something about waiting for delivery of his vehicle). That does not make sense.

Cramer's opinion doesn't mean SQUAWK. Cramer is frequently a contrarian indicator.

 

[vgrinshpun]

Some news related to Elon's visit to China starting to trickle in. According to China's Xinhua, Elon indicated that Tesla will move to localize engineering and production in China, regardless of possible economic slowdown in China.