Short-Term TSLA Price Movements - 2015

[dalalsid]

I think it is perfectly clear what he meant!

50 snakes of grey?

 

[drinkerofkoolaid]

I read the same article and I got a different impression. He doesn't say Elon is lying or misrepresenting, but rather that he is naive and underestimates the challenges of scaling up manufacturing. The article is critical of Musk, yes, but it didn't strike me as unfair.

I, for one, have trust in Tesla and I think they will succeed, but I can see how reasonable people can disagree on this one. This stuff is hard.

I'd say this part is both vague and unreasonable. The author makes this strong assertion without providing any evidence or reasoning to support his claim.

"That is a very naive statement: any automotive engineer can tell you that a compact sedan that sells millions of units each year will always be more of an engineering and production challenge than a six-figure vehicle produced in the low volumes."

 

[replicant]

He doesn't assimilate it, he contrasts it with a compact sedan. He's making the point that making a low-cost Corolla at high volumes is harder than making a luxury Model X at low volumes. I don't know much about manufacturing, so I don't know if this is true, but it's at least plausible.

It's easy to see malice in every critical opinion when you are down, but it's not useful.

Elon's words about the Model X's difficult production has nothing to do with scaling up production. Besides, he said that it was easier to scale up Model S/X production from dozens to hundreds than hundreds to thousands. He didn't talk about a cheap sedan.

PS: My comments wasn't about malice but ignorance. Who's down?

 

[jhm]

Reposting since I wanted to get feedback here. What do people make of current Model S demand into next two quarters.
----
With lowered guidance (which I forecasted a possibility) I have more questions about current Model S demand. Tesla guided q3 at same as q2 that too after pulling two demand levers in matter of weeks. That was a bit weak IMO. For q4, if you assume the same Model S sales as q3 (Osborne effect in full swing ), they are left with 5500 Model X delivery in q4 to reach 50K (lowest of the new guidance) mark. I THINK THAT IS A TALL ORDER if you even slightly don't take Tesla by its words.

It looks like Tesla MUST beat handily q3 to achieve new lowered guidance.

In 2 months, nobody will care if the Model S has a "demand problem." The question will be, how fast can we ramp up Model X? The ASP for Model X will easily be $10k higher than for the current mix of Model S. So the worry will be that owing to longer wait times for Model X, Model S sales may cannibalize sales of Model X.

Moreover, the focus will quickly turn to 2016. The ramp up will be a grind, but the payoff for Model X is in 2016.

So once Model X takes center stage, people will look at the stock very differently.

 

[The Blue Owl]

Who's down?

I wasn't referring to you personally. I meant that when one's portfolio is down (as many are right now, especially if they bought calls going into the ER), it can be hard to read critical opinions about the company and the stock with an open mind.

- - - Updated - - -

In 2 months, nobody will care if the Model S has a "demand problem." The question will be, how fast can we ramp up Model X? The ASP for Model X will easily be $10k higher than for the current mix of Model S. So the worry will be that owing to longer wait times for Model X, Model S sales may cannibalize sales of Model X.

Moreover, the focus will quickly turn to 2016. The ramp up will be a grind, but the payoff for Model X is in 2016.

So once Model X takes center stage, people will look at the stock very differently.

I fully agree with this. People forget that the same thing happened right around the Model S launch. Musk said the same thing at the time: they'd rather be late than deliver sub-standard cars. After a few months, the stock exploded.

 

[ev-enthusiast]

He doesn't assimilate it, he contrasts it with a compact sedan. He's making the point that making a low-cost Corolla at high volumes is harder than making a luxury Model X at low volumes. I don't know much about manufacturing, so I don't know if this is true, but it's at least plausible.

It's easy to see malice in every critical opinion when you are down, but it's not useful.

Sorry to chime in here, but there are some factors that drive complexity in automotive vehicle production:
- Number of parts used in a vehicle model (low/high tech (like robust/sophisticated))
- Number of factories that produce the same model (globally)
- Number of models produced that share parts, at least parts that have parts in common (Model S, X, ...)
- Number of versions of each model over time (like with the roadster version 1.0, 2.0, 2.5)
- Number of different markets each model is sold (homologation)
- Number of parts that vehicles have in common over dimensions time, geography, versions, ...
- Number of different suppliers for a single part to be used in a vehicle
- Different logistics for different parts manufacturers (internationally)
- Innovation rate (are parts evolving quickly over time)
- ...

... I could go on and on, worked in this area.

Sorry to be that precise here but the Corolla comparison is simply not true neither plausible.
The author has to know these facts, or he has to ask someone from the industry, or he is able to just not write things that are not true.

Producing a staggering amout of things that are all pretty similar in a single location is certainly not the most complex context.

BTW I read the article and my perception is that it is not neutrally biased.

To my opinion this article is in deed the worst I have seen in quite a while.
Just think a moment about this single sentence: Supply chain and production issues multiply vastly as production volumes rise." That is funny

I respect different opinions about the quality of the article.

 

[jhm]

Does anyone else smell a bear trap?

We've got this trilogy forming: Model X deliveries in September, Powerwall/pack deliveries in Q4, Model 3 unveiling and mass reservations in April. So what's the fourth part of this trilogy?

 

[The Blue Owl]

Sorry to chime in here, but there are some factors that drive complexity in automotive vehicle production:
- Number of parts used in a vehicle model (low/high tech (like robust/sophisticated))
- Number of factories that produce the same model (globally)
- Number of models produced that share parts, at least parts that have parts in common (Model S, X, ...)
- Number of versions of each model over time (like with the roadster version 1.0, 2.0, 2.5)
- Number of different markets each model is sold (homologation)
- Number of parts that vehicles have in common over dimensions time, geography, versions, ...
- Number of different suppliers for a single part to be used in a vehicle
- Different logistics for different parts manufacturers (internationally)
- Innovation rate (are parts evolving quickly over time)
- ...

... I could go on and on, worked in this area.

Sorry to be that precise here but this is simply not true neither plausible that a Corolla is more difficult to build than a Model S.
The author has to know these facts, or he has to ask an someone from the industry, or he can stop writing things that are not true.

Producing a staggering amout of things that are all pretty similar in a single location is certainly not the most complex context.

As I said, I don't know much about manufacturing. Consider me educated.

BTW I read the article and my perception is that it is not neutrally biased.

Of course it's not neutral; this is Bloomberg we're talking about. But when I read what critics say, even though I know they are not neutral, I still ask myself if there is any truth there. Doing otherwise would mean I may be losing out on adjusting to reality just because I don't like the source of info.

I'm saying that in this case the article raises some sobering points. Others disagree. The world keeps turning.

 

[aznt1217]

Sorry to chime in here, but there are some factors that drive complexity in automotive vehicle production:
- Number of parts used in a vehicle model (low/high tech (like robust/sophisticated))
- Number of factories that produce the same model (globally)
- Number of models produced that share parts, at least parts that have parts in common (Model S, X, ...)
- Number of versions of each model over time (like with the roadster version 1.0, 2.0, 2.5)
- Number of different markets each model is sold (homologation)
- Number of parts that vehicles have in common over dimensions time, geography, versions, ...
- Number of different suppliers for a single part to be used in a vehicle
- Different logistics for different parts manufacturers (internationally)
- Innovation rate (are parts evolving quickly over time)
- ...

... I could go on and on, worked in this area.

Sorry to be that precise here but this is simply not true neither plausible that a Corolla is more difficult to build than a Model S.
The author has to know these facts, or he has to ask an someone from the industry, or he can stop writing things that are not true.

Producing a staggering amout of things that are all pretty similar in a single location is certainly not the most complex context.

BTW I read the article and my perception is that it is not neutrally biased.

I respect different opinions.

Well aside from this. He seemed highly emotional in his writing. Not really feeling that because ... nobody in the public has seen the x. It's pretty much confirmed Tesla is waiting for optimization/suppliers to get all ducks in a row. The seat supplier established a new facility 15 mins away from Fremont. So this is a big deal-- because they want to avoid the P85D Seat fiasco they encountered last year.

That and this indicates to me that scaling up will be easier now because suppliers didn't believe Tesla would be viable when the goal was for 500 cars a week. The chain is only as strong as the weakest link.

 

[Johan]

Does anyone else smell a bear trap?

We've got this trilogy forming: Model X deliveries in September, Powerwall/pack deliveries in Q4, Model 3 unveiling and mass reservations in April. So what's the fourth part of this trilogy?

Fourth part could be ground breaking autonomous features (one level above what everyone else is doing and what most expect). Think of using the entire fleet of Teslas as one huge neural network, feeding big data to central servers that are in constant communication with all cars on the road, continuously feeding data out to assist especially those cars driving in (semi)autonomous mode (coupled of course with an industry leading in-car hardware and software suite).

Btw how was yoga class?

 

[JRP3]

Well aside from this. He seemed highly emotional in his writing.

Edward Niedermeyer has written anti-Tesla junk articles before. He's obviously biased, and, more importantly, simply wrong.

 

[austinEV]

Fourth part could be ground breaking autonomous features (one level above what everyone else is doing and what most expect). Think of using the entire fleet of Teslas as one huge neural network, feeding big data to central servers that are in constant communication with all cars on the road, continuously feeding data out to assist especially those cars driving in (semi)autonomous mode (coupled of course with an industry leading in-car hardware and software suite).

Ugh, you know I was unnerved by his comment about how autopilot worked best when it had a tracking vehicle. I *get* why that would be, but it implies that if the car in front of me drives off a cliff there is a disproportionate chance i would too..

 

[mrdoubleb]

Does anyone else smell a bear trap?

We've got this trilogy forming: Model X deliveries in September, Powerwall/pack deliveries in Q4, Model 3 unveiling and mass reservations in April. So what's the fourth part of this trilogy?

Actual 2015 delivery numbers announced January 3rd and being comfortably above 50k. All the doom and gloom headlines today read 50-55k as 50k... so even if they end up with only 53-54k, we may see the reverse of what happened today.

 

[Drax7]

I fail to believe that Elon is naive about anything regarding engineering.
Optimistic by nature yes, naive no way .
Software engineer, rocket engineer, and over 10 years as car engineer,
plus an exceptional intellect does not add up as naive. Naive is the
Uninformed Bloomberg commentator that should be in awe of Elon.

 

[EarlyAdopter]

Does anyone else smell a bear trap?

We've got this trilogy forming: Model X deliveries in September, Powerwall/pack deliveries in Q4, Model 3 unveiling and mass reservations in April. So what's the fourth part of this trilogy?

The fourth part is Gigafactory phase 1 complete.

 

[ev-enthusiast]

Of course it's not neutral; this is Bloomberg we're talking about. But when I read what critics say, even though I know they are not neutral, I still ask myself if there is any truth there. Doing otherwise would mean I may be losing out on adjusting to reality just because I don't like the source of info.

I'm saying that in this case the article raises some sobering points. Others disagree. The world keeps turning.

Context is a great thing.

Like you say with Bloomberg.
You read some articles on Bloomberg that have not been written in a neutral way, so you adjust your bias or you ignore this source of information as it could be very misleading.

The same works for critics.
If some critics are not neutral, try to adjust to their bias or ignore them. Their info could be very misleading and you could make wrong decisions.

I am still not able to find any sobering point in this article, only incorrect and misleading points.

Again I do respect other opinions.

 

[eloder]

Ugh, you know I was unnerved by his comment about how autopilot worked best when it had a tracking vehicle. I *get* why that would be, but it implies that if the car in front of me drives off a cliff there is a disproportionate chance i would too..

Not concerned about it unless you flipped the turn signal, indicating to the car that you also wanted to go off the cliff

I think situations like that though are always why GPS and maps are needed and have stated to be actively used with Autopilot. The car's going to signal for the human to take over if it runs into a contradiction like that, while simultaneously still sticking to the road that its road-tracking cameras and GPS see.

 

[highend]

Did some tricky TSLA chart analysis.... And got possible options, more optimistic:

- we should recover to 260 level
- then we could FALL to 215-220 level (!) and this might be buying opportunity
- if it will be confirmend - then price target could be 330

I don't know how to show you in charts but my method is pretty simple and works.
I said previously 150-180 level and HOPEFULLY we won't go there.

 

[ev-enthusiast]

Well aside from this. He seemed highly emotional in his writing. Not really feeling that because ... nobody in the public has seen the x. It's pretty much confirmed Tesla is waiting for optimization/suppliers to get all ducks in a row. The seat supplier established a new facility 15 mins away from Fremont. So this is a big deal-- because they want to avoid the P85D Seat fiasco they encountered last year.

That and this indicates to me that scaling up will be easier now because suppliers didn't believe Tesla would be viable when the goal was for 500 cars a week. The chain is only as strong as the weakest link.

I still like Tesla expanding in Fremont very much.
Every supplier they are able to pull directly to their factory reduces risk.
That is very positive.

Today's global supply chains usually spread over the entire globe and are permanently monitored, going this way maximizes risk but will save a buck here and a buck there for the company.

 

[pGo]

Did some tricky TSLA chart analysis.... And got possible options, more optimistic:

- we should recover to 260 level
- then we could FALL to 215-220 level (!) and this might be buying opportunity
- if it will be confirmend - then price target could be 330

I don't know how to show you in charts but my method is pretty simple and works.
I said previously 150-180 level and HOPEFULLY we won't go there.

Curious question, what are you doing here in this forum if your method works?