$7500 federal plus whatever the state incentive is. The inventory cars are in NY but I couldn't find a state incentive for NY - maybe it listed $10,000 off because it knew I was in CA, I'm not sure.
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Short-Term TSLA Price Movements - 2015
- Thread starter Robert.Boston
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$7500 federal plus whatever the state incentive is. The inventory cars are in NY but I couldn't find a state incentive for NY - maybe it listed $10,000 off because it knew I was in CA, I'm not sure.
No, I won't do that publically in this forum instead of private message communication. You must have forgotten how much personal attacks from those guys if any negative opinion published in up cycles. Ironically, in down cycle, it's safer to publish some negative views although I agree it should had more value in opposite way.
Maoing, few people on this board go after a post simply because it is negative. What we dislike is negative statements that lack evidence or a logical argument to back them up. For example, when you cited "demand issues" as a current problem for Tesla, 99% of us rolled our eyes and several people added you to their ignore lists. If you had offered reasonable evidence of a demand issue or a logical argument why a demand issued existed, the response would have been different. Some member would undoubtedly challenge the argument, but it would be a respectful exchange of opinions. The same goes for people who routinely post positive predictions but offer no evidence or logical argument to back up their point. Although they're less likely to be challenged, they lose credibility if they offer no concrete reasons for their position.
Papafox, I think I had laid down my reasonings in many occasions, but people tend to ignore what they don't like to believe and I have no obligation to convince them. Here I would like to summarize them again per your requests, although I agree I might be partially wrong but it guided me to achieve 35% YTD gain even after some hit post Q3 ER on TSLA trading (just checked my account) very well.
First, let's start from Tesla Q2 ER in 2014, it's guided to achieve 2000/week production rate by end of 2015 saying "Provided that we execute well and there are no serious macroeconomic shocks,
Tesla’s annualized delivery rate should exceed 100,000 units by the end of next year";
Second, in November 17/2014 Tesla blog, it states "The line is now running at about 1,000 cars a week with the potential for significantly more with minor adjustments."
So here was the question every investor needs to ask right after 2015 Q1 guidance. Why it's only guided for 11,627 production? Then following Q2/Q3 production guidance which are all ~1000/week production rate. Isn't it minor adjustment can significantly increase production per Tesla Blog? In my thesis, production would be the least issue for Model S, as soon as TM has money to invest tooling and hiring workers, the production rate can't be flat in such long period, essentially Q4Q1Q2Q3 four quarters in a row. (Model X is on different issue, the slow production ramp up attributes to complex over engineering though). Remember, during the course of last 4 quarters, TM introduced dual motor model which Elon claimed demand surge right after production, then introduced 70D which essentially a "discounted" model, and then referral program, now up to $12.5K incentive program in China to stimulate demand.
With approaching end of 2015, every investor should ask what prevents Tesla to achieve 2000/week production rate? Even Elon excluded the possibility to achieve such rate by end of 2016. The model X execution issue will only last a few quarters. There is no macros issues as FANG all grow very well. What else issue TM is facing? Sorry I can't image any issues other than demand.
TSLA stock price was based on the projection for exponential growth and Elon's optimism. Once the real demand growth can't meet the expectation, then stock price doomed.
The demand issue not only affects the top line of TSLA stock price, but also affects the bottom line. It's a shame for TM management to miss the annual guidance in a row for two years, but it actually can be avoided if Model S demand is strong. Do you guys still remember Elon said in Q4 CC that TM can achieve 55K goal even without China and Elon even quoted 60K model S annual demand sometime back in 2014. Now with China in the picture which at least contributes 4K model S, why can't TM simply beat the 55K guidance by model S only? Why the market chose not to believe Elon's 50K-52K guidance post Q3 ER?
I think my reasoning is enough. TM doesn't lack demand growth, the trouble is the growth can't meet super high expectation back to 2013/2014, so you see the SP back to almost 2 years ago. In the meantime, current demand even can't sustain the bottomline of TM guidance which is very bad we see the price action right now.
Btw, I don't buy any Model S production constraint as I debated with several folks in early 2015.
First, let's start from Tesla Q2 ER in 2014, it's guided to achieve 2000/week production rate by end of 2015 saying "Provided that we execute well and there are no serious macroeconomic shocks,
Tesla’s annualized delivery rate should exceed 100,000 units by the end of next year";
Second, in November 17/2014 Tesla blog, it states "The line is now running at about 1,000 cars a week with the potential for significantly more with minor adjustments."
So here was the question every investor needs to ask right after 2015 Q1 guidance. Why it's only guided for 11,627 production? Then following Q2/Q3 production guidance which are all ~1000/week production rate. Isn't it minor adjustment can significantly increase production per Tesla Blog? In my thesis, production would be the least issue for Model S, as soon as TM has money to invest tooling and hiring workers, the production rate can't be flat in such long period, essentially Q4Q1Q2Q3 four quarters in a row. (Model X is on different issue, the slow production ramp up attributes to complex over engineering though). Remember, during the course of last 4 quarters, TM introduced dual motor model which Elon claimed demand surge right after production, then introduced 70D which essentially a "discounted" model, and then referral program, now up to $12.5K incentive program in China to stimulate demand.
With approaching end of 2015, every investor should ask what prevents Tesla to achieve 2000/week production rate? Even Elon excluded the possibility to achieve such rate by end of 2016. The model X execution issue will only last a few quarters. There is no macros issues as FANG all grow very well. What else issue TM is facing? Sorry I can't image any issues other than demand.
TSLA stock price was based on the projection for exponential growth and Elon's optimism. Once the real demand growth can't meet the expectation, then stock price doomed.
The demand issue not only affects the top line of TSLA stock price, but also affects the bottom line. It's a shame for TM management to miss the annual guidance in a row for two years, but it actually can be avoided if Model S demand is strong. Do you guys still remember Elon said in Q4 CC that TM can achieve 55K goal even without China and Elon even quoted 60K model S annual demand sometime back in 2014. Now with China in the picture which at least contributes 4K model S, why can't TM simply beat the 55K guidance by model S only? Why the market chose not to believe Elon's 50K-52K guidance post Q3 ER?
I think my reasoning is enough. TM doesn't lack demand growth, the trouble is the growth can't meet super high expectation back to 2013/2014, so you see the SP back to almost 2 years ago. In the meantime, current demand even can't sustain the bottomline of TM guidance which is very bad we see the price action right now.
Btw, I don't buy any Model S production constraint as I debated with several folks in early 2015.
JRP3
Hyperactive Member
You're willing to say Musk was wrong about guidance, why could Musk not have also been wrong about the ease of getting to 2k/week production rate? If they couldn't get near 2k/week production rate for whatever reasons then demand could in fact still be high but they could also still be production constrained.
Electrifying
Member
What you listed IMO does not equate "Tesla has a demand problem".
I remember one guy analyzed the 70D release, and concluded it could actually be a smart way to optimize profit given a limited supply of batteries. If Tesla only had enough batteries from Panasonic to deliver 40,000 85KWh Models S's, then adding 70D into the mix would allow them to deliver up to 21.4% more cars (85/70 = 1.214). Yes releasing 70D allows more people to afford the car but we don't know Tesla did this because they were having insufficient demand.
As for the new incentive in China, if could be a temporary strategy to increase market share at the cost of profit. They did raise price in China about a month ago due to US dollar appreciation.
So if you believe there is such a demand problem, why did you say in an earlier post that you plan to buy more TSLA on Monday with the market panic? I don't understand the logic.
anticitizen13.7
Not posting at TMC after 9/17/2018
There could be limiting factors in the supply chain. Someone already brought up the issue of battery supply. Even if the line is physically capable of handling more cars, Tesla may not be able to acquire enough batteries to build more vehicles.
Basically, there could be any number of reasons that the production line didn't produce as many cars as you expected. This doesn't logically imply lack of demand.
Model S delivery lead times appear to have held fairly steadily at a bit under 2 months from ordering to delivery. If demand for the Model S was falling, a decrease in lead time would be an indicator.
Maoing,
Thanks for stating your reasons for mentioning a demand problem. Now we can carry on a discussion.
I'm curious about your bringing up the 2,000 vehicles per week production numbers that Elon mentioned could be possible at the end of 2015. Did you believe that those numbers were for Model S alone? Tesla had planned to have Model X ramped up by the end of this year and 2,000 vehicles/week was for the combination of S and X, being produced on two body-in-white lines. If Tesla is currently making about 1300 Model S cars per week (16,000 for 4Q / 12 weeks), the Model S is clearly fulfilling its share of the 2,000 vehicles/week prediction. The problem is that Model X ramp up has been delayed and Tesla cannot get to that 2,000 vehicles a week production rate with only one body in white production line and no contributions from Model X. What I see is clearly a production issue, not a demand issue, especially with tens of thousands of Model X orders ready to go. How do you look at this situation and call it a demand issue? I am puzzled.
Thanks for stating your reasons for mentioning a demand problem. Now we can carry on a discussion.
I'm curious about your bringing up the 2,000 vehicles per week production numbers that Elon mentioned could be possible at the end of 2015. Did you believe that those numbers were for Model S alone? Tesla had planned to have Model X ramped up by the end of this year and 2,000 vehicles/week was for the combination of S and X, being produced on two body-in-white lines. If Tesla is currently making about 1300 Model S cars per week (16,000 for 4Q / 12 weeks), the Model S is clearly fulfilling its share of the 2,000 vehicles/week prediction. The problem is that Model X ramp up has been delayed and Tesla cannot get to that 2,000 vehicles a week production rate with only one body in white production line and no contributions from Model X. What I see is clearly a production issue, not a demand issue, especially with tens of thousands of Model X orders ready to go. How do you look at this situation and call it a demand issue? I am puzzled.
I believe he is referring to the supposed decrease in 2016 guidance from 2,000/wk to 1600-1800/wk. I have seen him mention that before. My hope is that the discrepancy is due to the 2,000/wk being a maximum in a good week and that the 1,600 - 1,800 is an annualized number that takes into account a combination of holidays, scheduled downtime, and a target they can easily beat (winning has to feel like winning).
Does anyone have the exact quote and context from when the 2,000 per week was first discussed?
I think I understand his logic. I certainly appreciate his insights.
He seems to describe multiple facets to "demand" and anyone of them can cause a problem AND an opportunity. If I understand correctly, there is no demand issue now (ie plenty of demand) but once they ramp up production, there is concern demand will taper off - then some people will look at the stock as overpriced.
His analysis enables an investor to play both sides but with a long position expecting growth.
He is buying because the short term opportunity demand presents while they fulfil X orders is real and should lead to SP increase, but after that we will need to wait and see. The panic is creating a buying opportunity. That isn't hard to understand.
I'm expecting good growth like most people to model 3 launch and as we start to see a lot of reservations, but I think they'll be a lot of room for noise ..
He seems to describe multiple facets to "demand" and anyone of them can cause a problem AND an opportunity. If I understand correctly, there is no demand issue now (ie plenty of demand) but once they ramp up production, there is concern demand will taper off - then some people will look at the stock as overpriced.
His analysis enables an investor to play both sides but with a long position expecting growth.
He is buying because the short term opportunity demand presents while they fulfil X orders is real and should lead to SP increase, but after that we will need to wait and see. The panic is creating a buying opportunity. That isn't hard to understand.
I'm expecting good growth like most people to model 3 launch and as we start to see a lot of reservations, but I think they'll be a lot of room for noise ..
Ah, thanks for this perspective. One piece of information that needs to be considered here is Tesla's rumored plans to at some point move both S and X production to the new body-in-white line and then revamp the older body-in-white line in preparation for Model 3. That plan could put some stress, at least for a while, on maximum weekly production numbers. The good news is that if Tesla moves forward with this plan, we would see substantial evidence that Model 3 preparations are gearing up. My guess is that demand exists for producing 2,000 model S and X vehicles per week in 2016 but the complexities of production will limit the maximum rate, especially if both vehicles move to a single body-in-white line.
Thanks, but not quite what I'm looking for. The article doesn't have a quote regarding production, it simply says they expect to make 100,000 which I'm not sure was ever stated by Tesla. I know 2,000/wk was mentioned, just not sure when and wondering what the context for the number was.
anticitizen13.7
Not posting at TMC after 9/17/2018
The 2000/week was expected "run rate", NOT meant to imply that the lines would build that many cars for the whole year.
I remember this being discussed a lot. There was much confusion over the difference between "run rate" and annual production.
It appears it must have been first mentioned in the Q2 2014ER/CC based on the articles I can find. I have tried pulling it up off the investor section of TM web page but have been unable to...Does someone have a copy of that letter released with Q2 2014 ER?
IIRC that was a production rate that EM/TM wished to achieve by the end of 2015.
There's a link to the letter within that article: http://files.shareholder.com/downloads/ABEA-4CW8X0/3368910868x0x772849/0cdad2cf-0497-41a3-ad2a-788f57412777/Tesla%20Q2
Second Quarter 2014 Shareholder Letter
"In addition, we are adding new production capacity at our Fremont factory that will allow us to meet the growing
worldwide demand for our vehicles. The speed at which we are executing this capacity upgrade will allow us to exceed
35,000 Model S deliveries this year. Provided that we execute well and there are no serious macroeconomic shocks,
Tesla’s annualized delivery rate should exceed 100,000 units by the end of next year."
mmd
Active Member
I don't see any reason for all these arguments. Tesla itself guided down demand and production for 2016 in Q2 2015 shareholder letter. So, all these reasons for the shortfall in deliveries are irrelevant. Wondering, how many posters here bother reading the shareholder letters? Looks to me, this forum has too many emotional investors.
Q2 2015 shareholder letter: "Looking ahead to next year, we are highly confident of a steady state production and demand of 1,600 to 1,800 vehicles per week combined for Model S and Model X."
Q4 14 shareholder letter: "In late summer, we plan to begin Model X body production in our new robotic body assembly shop that will run in parallel with our current Model S body shop. Shortly thereafter, we plan to start painting Model S and Model X vehicles in our new paint facility in Fremont. Should we achieve our design targets, this new paint shop will set new standards for high volume paint shops worldwide in terms of paint quality, labor and energy efficiency, and low environmental impact. It will also be flexible enough and have the capacity to paint Model 3 in the future. These and other investments should provide us with sufficient capacity to increase our production to 2,000 vehicles per week by year-end."
So, a production capacity of 2000/week doesn't mean the company will produce at that level, or if there is demand for that. Now, looks like even meeting 1600-1800 steady state is a stretch.
PS: As noted here a week ago, I sold my trading shares @230 when I saw the rally stall.
Q2 2015 shareholder letter: "Looking ahead to next year, we are highly confident of a steady state production and demand of 1,600 to 1,800 vehicles per week combined for Model S and Model X."
Q4 14 shareholder letter: "In late summer, we plan to begin Model X body production in our new robotic body assembly shop that will run in parallel with our current Model S body shop. Shortly thereafter, we plan to start painting Model S and Model X vehicles in our new paint facility in Fremont. Should we achieve our design targets, this new paint shop will set new standards for high volume paint shops worldwide in terms of paint quality, labor and energy efficiency, and low environmental impact. It will also be flexible enough and have the capacity to paint Model 3 in the future. These and other investments should provide us with sufficient capacity to increase our production to 2,000 vehicles per week by year-end."
So, a production capacity of 2000/week doesn't mean the company will produce at that level, or if there is demand for that. Now, looks like even meeting 1600-1800 steady state is a stretch.
PS: As noted here a week ago, I sold my trading shares @230 when I saw the rally stall.
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