Short-Term TSLA Price Movements - 2015

[demetri]

They need roughly 16k to reach target of 50k. Best case is 2k a week for 24k for q, total 57k. Probably not likely, Elon said they can burst to 2k but average will be 1600-1800. Low end of that range 1600 gets us to to 52k. I think we get between 50-55k my guess is 53k. Did they disclose production for q3 or just deliveries? We may have 500+ cars not delivered that add to 4q. Barring any supply and production ramp up problems, I think 53k is doable, it means going from 11k in 3q to 20k in 4q almost double to get to 53k a tough task. But I have faith they will get to a least 50k, even if it takes a lot of overtime and weekend work. The margins will be high do to X so they can afford the overtime, so 4q numbers don't get messed up.

I have some Jan 16's so would like to see ath by end of year. Most of my investment is shares now so not worried about timing. The fourth quarter announcement of stationary storage sales and plans will be a big catalyst I believe. Hope we get some color on 3q call and we get upgraded pt numbers due to that. Still waiting for a big announcement about stationary storage with big power companies or country, India for example that solidifies it's true potential.

 

[Hogfighter]

Remember Elon said on the last CC that 'winning should feel like winning'. In other words, previously Elon would give his scientific best-guess on Deliveries. Going forward he wants to give his scientific best-guess on the low end of Deliveries so that the employees feel good about beating the estimates rather than merely meeting the estimates.

My guess is that they will beat 50k deliveries this year, regardless of the X ramp.

 

[MitchJi]

i have zero concern about demand for X or S. When someone goes out of their way to let everyone know they are canceling I simply say next, the line is long and will continue to get longer. I mentioned this in another post, 2 clear demand levers for the future (smaller X battery and folding seat option). Those that want either will have to wait.

I don't think that there is going to be a big demand for folding seats. I think for most potential customers the easy access to the third row is more important. I'm not disagreeing with AMCi's decision. But I don't think that the majority of potential customers have the same priorities.

They have another way to lower prices. They will be able to reduce the price of the 90kWh packs substantially, without reducing their margins due to GF related cost reductions, which are expected to be at least 30% by 2017.

 

[AlMc]

I don't think that there is going to be a big demand for folding seats. I think for most potential customers the easy access to the third row is more important. I'm not disagreeing with AMCi's decision. But I don't think that the majority of potential customers have the same priorities. A folding seat option does not preclude the ability of the seats to mechanically slide forward for easy access to the third row. I have NO idea how many people find folding seats a necessity. However, I do know some people are canceling because of it. When I ask the question: 'If you are happy with the way the X is now, would you have canceled IF only a folding second row seat was offered?" No one has come forward to say they would cancel with that scenario.

They have another way to lower prices. They will be able to reduce the price of the 90kWh packs substantially, without reducing their margins due to GF related cost reductions, which are expected to be at least 30% by 2017.

Road & Track Article

Below is the relevant sentence:

"While the second-row seats don't fold down, they do motor forward and tilt to open up enough rear cargo space to carry sheets of plywood, two-by-fours, or even a surfboard, a Tesla engineer reassured us."

Addressed in another thread as well. My follow up question to the engineer: 'Picture or it did not happen'. I have been wrong many times before but I was at the reveal. I can't see that this assertion is correct. I have hauled many things inside our SUVs.....lots of DIY projects at home and work...overloading many a time....Until I see this type of material in the sizes claimed 'in the flesh'. I am not buying it.

 

[JRP3]

What if the plywood was put in at an angle with one end resting on top of the tilted forward 2nd row? Would that be 8ft?

 

[Scott Ales]

There seems to be a complete loss of memory or at least recognition of Tesla's order and supply system. Not that it is innovative or new. It's just that we drifted away from it 30-50 years ago.

About 1975 to 1980 the manufacturers decided it would be better to create "Packages" and stock inventory that most people would want or seemed to be popular. Occasionally someone would wait for a specific "Special" order car. But for the large part, people would take what the dealers had to offer. If they wanted something special, the dealer or salesperson (I know because I was one from 1986-1988, Nissan, Jaguar, & Mercedes) would make their best attempt to dissuade the buyer any way possible from ordering and sell that day from stock. Why? Owners and managers mandated that every customer be sold on the spot or the location would risk the next SUPER salesperson who would steal the sale from you. That all changed "Back" to the way it used to be with a twist, pure data.

Have you noticed with Tesla the constant adjustment of new features, dropping of certain packages reconfigured to suit what the buyers are ordering? This method of ONLY ordering online, not being forced to buy from stock, is a quiet re-revolution. It's is the primary method for Tesla to know what people want and adjust the program accordingly. Not what the sales person is able to sell, rather, what the buyers are looking at online and then ordering. And who's to say they don't also track the clicks per page or option reviewed? For instance, they could check the clicks on a package and compare the actual orders with that package to judge buying interest specifically. They are the ONLY manufacturer which has this pure data as others are all influenced by marketing, dealership choices on what to stock (often poor choices), and the power of the salesperson to convince people of things they really don't want or need. Please don't try to suggest otherwise on this. If you've ever bought a new car you know it's true.

What does this mean? Have you ever wondered why they or specifically Elon is so cocky about controlling demand? It's as though he has an absolute and immediate direct connection to the entire prospective buying market in one place. No other manufacturer has this!!! Their data is not pure, tainted by the dealer, dealer group, or sales persons.

Let Wall Street obsess over projections and numbers, I am quite confident Tesla is able to drive demand through data, sales and cancellations. Then they can constantly adjust the demand to match production constraints, new products, control one model from siphoning another, and have the data to prepare for the next best thing! If you question that, show me another manufacturer who has sold EVERY car at full list price with no bodystyle changes for 4 years. For the entire industry since 1900 this has NEVER been the case. Unless you're a very small builder like Ferrari. Even they have their certain models which had to be discounted. Not one discount from Tesla though, even to Elon's person friends and family. Not even to himself! If they want to go fast in sales they only need to improve, modulate or control production. And the bigger they grow the more accountable suppliers will need to be! Think WalMart if that principle needs reinforcing in your mind. If they want to go slow they can simply let the current offerings and packages stand pat for an extended period until production is available or slows. The experience with these three models will allow them a tremendous upside when launching the Model 3.

So from my perspective as an industry insider, Tesla has unprecedented control because they sell direct to the consumer and have all the data. My parents and grandparents all used to order their cars and wait, we just became more impatient. It's the nature of our world today. But clearly the buying public is willing to wait for really great products, the investment community isn't so easy. And there lies the constant need for our vigilance, spending most of our time judging Wall Street, the media, and entrenched interests with their misguided perceptions of a complete transportation revolution, not Tesla.

 

[MartinAustin]

There are TWO body lines. For now, The original body line 1 will continue producing model S body in white. The new body line 2 will produce the model X Body In White. These two body lines will operate in parallel. They are robotic weld lines.

From here, the body in white goes to the paint shop and the both cars go into the single conveyor based Vehicle Assenbly Line. In other words, the vehicle assembly line produces both cars

Taking this into account, some thoughts on deliveries numbers.

Q1 initial announcement was 10,030. Eventual Q1 report said 10,045. (a bump of 0.15%)
Q2 initial announcement was 11,507. Eventual Q2 report said 11,523. (a bump of 0.22%)
Q3 initial announcement was 11,580.

If the bump is a similar 0.22% then the actual Q3 deliveries number will be 11,605.

This brings the total delivered in the first three quarters to 33,182 and a further 16,818 required to get to 50,000.

16,818 is 5,213 more cars than what they might have actually delivered in Q3... 11,605.

So, they delivered 11,532 in Q2 with just one assembly line. They perhaps delivered 11,607 in Q3, and were setting up a second assembly line during this quarter. It seems OK to say that they can deliver mid-11K vehicles every quarter until the end of time. Their one job in Q4 is to deliver 16,818 vehicles. How can they get up to this number?

Oh yeah... they just put in a new assembly line. They have Model S and Model X reservations out the wazoo, and are adept at turning out Model S, should all the worst case manufacturing scenarios come true for Model X.

How can they not turn out an additional 5,213 cars - either Model X or Model S - during Q4?

- - - Updated - - -

With 13 weeks in the quarter, if their Vehicle Assembly Line is capable of 1,700 cars per week, that points to 22,100 cars. So 16,818 should be do-able

 

[AlMc]

Taking this into account, some thoughts on deliveries numbers.

Q1 initial announcement was 10,030. Eventual Q1 report said 10,045. (a bump of 0.15%)
Q2 initial announcement was 11,507. Eventual Q2 report said 11,523. (a bump of 0.22%)
Q3 initial announcement was 11,580.

If the bump is a similar 0.22% then the actual Q3 deliveries number will be 11,605.

This brings the total delivered in the first three quarters to 33,182 and a further 16,818 required to get to 50,000.

16,818 is 5,213 more cars than what they might have actually delivered in Q3... 11,605.

So, they delivered 11,532 in Q2 with just one assembly line. They perhaps delivered 11,607 in Q3, and were setting up a second assembly line during this quarter. It seems OK to say that they can deliver mid-11K vehicles every quarter until the end of time. Their one job in Q4 is to deliver 16,818 vehicles. How can they get up to this number?

Oh yeah... they just put in a new assembly line. They have Model S and Model X reservations out the wazoo, and are adept at turning out Model S, should all the worst case manufacturing scenarios come true for Model X.

How can they not turn out an additional 5,213 cars - either Model X or Model S - during Q4?

I follow your logic completely. My concern is not production..can they deliver? I am not saying they can't do it but my local SC is pretty busy with prep and delivery now....they have to ship, prep and deliver 50% more vehicles in a system that already is pretty busy. They can hire (or maybe have hired and trained) more staff. But, it is not just can line #1 and #2 produce 50% more Q4 vs Q3.....I think they can....Just pointing out it is not just the ramp in production that needs to happen.

I know there has been some talk about demand. I think TM will not be demand constrained for years. Just as demand stabilizes for S and X, then model 3 comes out...

 

[Blip]

Plus given the fact that Elon tweeted that a couple of suppliers for the Model X will determine the speed of the Model X ramp...

Can't find. Link?

 

[Jeeps17]

... snip ... So from my perspective as an industry insider, Tesla has unprecedented control because they sell direct to the consumer and have all the data. My parents and grandparents all used to order their cars and wait, we just became more impatient. It's the nature of our world today. But clearly the buying public is willing to wait for really great products, the investment community isn't so easy. And there lies the constant need for our vigilance, spending most of our time judging Wall Street, the media, and entrenched interests with their misguided perceptions of a complete transportation revolution, not Tesla.

Thank you for sharing your insight !

 

[MitchJi]

I don't think that there is going to be a big demand for folding seats. I think for most potential customers the easy access to the third row is more important. I'm not disagreeing with AMCi's decision. But I don't think that the majority of potential customers have the same priorities.

A folding seat option does not preclude the ability of the seats to mechanically slide forward for easy access to the third row. I have NO idea how many people find folding seats a necessity. However, I do know some people are canceling because of it. When I ask the question: 'If you are happy with the way the X is now, would you have canceled IF only a folding second row seat was offered?" No one has come forward to say they would cancel with that scenario.

We agree? At least our statements are not contradictory.

 

[Scott Ales]

Thank you for sharing your insight !

You are entirely welcome. I feel it an obligation and privilege to offer anything which has even the slightest potential to further or increase the positive impact of this company.

 

[hobbes]

So, they delivered 11,532 in Q2 with just one assembly line. They perhaps delivered 11,607 in Q3, and were setting up a second assembly line during this quarter. It seems OK to say that they can deliver mid-11K vehicles every quarter until the end of time. Their one job in Q4 is to deliver 16,818 vehicles. How can they get up to this number?

Oh yeah... they just put in a new assembly line. They have Model S and Model X reservations out the wazoo, and are adept at turning out Model S, should all the worst case manufacturing scenarios come true for Model X.

How can they not turn out an additional 5,213 cars - either Model X or Model S - during Q4?

- - - Updated - - -

With 13 weeks in the quarter, if their Vehicle Assembly Line is capable of 1,700 cars per week, that points to 22,100 cars. So 16,818 should be do-able

Even if they used the second line to only build Model Ss, I do not think it would be possible to produce at the nominal production rate from week one, there would have to be a ramp, too (people being trained, robots too, suppliers having to double their output).

Then, producing two different vehicles at the same line wouldn´t make it any easier. Yeah, the will eventually build both Models at the new line (when production of both is running smoothly), but in the beginning, I am quite sure they will keep it separate.

 

[Cobos]

Thank you for sharing your insight !

Though keep in mind this is mostly a US specific issue. Most of Europe buys cars to order and waits the 1-3 months it takes for the car to be built and shipped. Usually dealers will stock some like 5-10 cars of a popular/new model with popular option packages to sell to those who can't wait, but generally you buy to order. My MIL bought a pretty basic Skoda compact car and that was made to order as well.

Cobos

 

[CHGolferJim]

We can update to actual figures when 3Q is made official:

1Q-3Q YTD Sales = 33,200

if 4Q production rate starts at 1,000 and ends at 1,600, and it advances linearly for an average of 1,300/week --> 15,600 to 16,800 total plus perhaps 10% upside (1800 vs. 1600). Let's say 2.5 weeks of 4Q production can't be shipped = 3,200. So 4Q sales = 16,200 - 3,200 + end 3Q shipments in transit = ?. Conservative case projection = 49k-50k + whatever they want to push at year-end to get cars to people for their tax credits and to boost 2015 sales.

 

[mdemetri]

Can't find. Link?

See post #13930 up-thread.

Short-Term TSLA Price Movements - 2015 - Page 1393

 

[drinkerofkoolaid]

I think Tesla needs to clarify a number of things before the stock can achieve a new all time high.

1) Tesla initially said 20-30% of the Gigafactory would be used for battery storage. Tesla also said that in addition to the battery storage, the factory would be capable of producing 500,000 vehicles annually. However, demand for the Model S, Model X, and battery storage is much higher than Tesla initially projected.

- How has the situation with the Gigafactory changed, and what is Tesla doing to make it possible for Tesla to meet the demand?
- What types of things is Tesla working with its suppliers on to make it possible to accelerate the production of lithium ion batteries?

2) Additional details about the Model X. If reservations placed today will be delivered in 2016, how many Model X is Tesla expecting to sell in 2016?
What is the current backlog?
How many Model X is Tesla currently producing weekly?

3) Additional information about partners for the Supercharger network.

4) Additional information about Tesla's relationship with numerous countries. (The charging standard in Europe and in China)

5) Purely a guess. I'd be surprised if the 90kwh Model X isn't capable of being upgraded to a 100-110kwh battery in the near future.

Imagine This: AWD Tesla Model S and X With 100-Plus kWh Battery - Tesla CEO Hints At Future Arrival | Inside EVs

 

[pGo]

We can update to actual figures when 3Q is made official:

1Q-3Q YTD Sales = 33,200

if 4Q production rate starts at 1,000 and ends at 1,600, and it advances linearly for an average of 1,300/week --> 15,600 to 16,800 total plus perhaps 10% upside (1800 vs. 1600). Let's say 2.5 weeks of 4Q production can't be shipped = 3,200. So 4Q sales = 16,200 - 3,200 + end 3Q shipments in transit = ?. Conservative case projection = 49k-50k + whatever they want to push at year-end to get cars to people for their tax credits and to boost 2015 sales.

Tesla expects 1600-1800 cars/week average production rate for 2016. This doesn't mean they exit 2015 at 1600. I currently expect them to exit at or around 1250-1300 cars/week.

http://www.forbes.com/sites/chuckjones/2015/10/04/teslas-december-quarter-estimates-about-to-ratchet-down/?utm_campaign=yahootix&partner=yahootix

 

[Scott Ales]

I think Tesla needs to clarify a number of things before the stock can achieve a new all time high.

1) Tesla initially said 20-30% of the Gigafactory would be used for battery storage. Tesla also said that in addition to the battery storage, the factory would be capable of producing 500,000 vehicles annually. However, demand for the Model S, Model X, and battery storage is much higher than Tesla initially projected.

- How has the situation with the Gigafactory changed, and what is Tesla doing to make it possible for Tesla to meet the demand?
- What types of things is Tesla working with its suppliers on to make it possible to accelerate the production of lithium ion batteries?

2) Additional details about the Model X. If reservations placed today will be delivered in 2016, how many Model X is Tesla expecting to sell in 2016?
What is the current backlog?
How many Model X is Tesla currently producing weekly?

3) Additional information about partners for the Supercharger network.

4) Additional information about Tesla's relationship with numerous countries. (The charging standard in Europe and in China)

5) Purely a guess. I'd be surprised if the 90kwh Model X isn't capable of being upgraded to a 100-110kwh battery in the near future.

Imagine This: AWD Tesla Model S and X With 100-Plus kWh Battery - Tesla CEO Hints At Future Arrival | Inside EVs

Additionally, it's not out of the question for them to NOT address these points publicly if there is a reason down the road to have another capital raise. Imagine if they were completely transparent about everything 6 months ago and the stock was trading over $300. It would have been more difficult to have the recent offering. Right? I give Elon and the Tesla team high marks for managing the entire situation very well. Certainly better than any has previously.

- - - Updated - - -

Though keep in mind this is mostly a US specific issue. Most of Europe buys cars to order and waits the 1-3 months it takes for the car to be built and shipped. Usually dealers will stock some like 5-10 cars of a popular/new model with popular option packages to sell to those who can't wait, but generally you buy to order. My MIL bought a pretty basic Skoda compact car and that was made to order as well.

Cobos

I understand this and it is a very good point. But the majority of the critics are stateside for the moment. At least the ones who get the most press. And the dealership salespeople working with customers still taint the data as compared to Tesla.

 

[drinkerofkoolaid]

Additionally, it's not out of the question for them to NOT address these points publicly if there is a reason down the road to have another capital raise. Imagine if they were completely transparent about everything 6 months ago and the stock was trading over $300. It would have been more difficult to have the recent offering. Right? I give Elon and the Tesla team high marks for managing the entire situation very well. Certainly better than any has previously.

- - - Updated - - -

Tesla won't need to do another capital raise, although it might make sense if Tesla wants to begin building a second or third factory ahead of schedule. The moment Tesla begins taking reservations for the Model 3, and finalizing orders for the Powerwall and Powerpack, Tesla will have a few billion to invest in increasing production.