Short-Term TSLA Price Movements - 2016

[myusername]

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Comparing Tesla to tech companies makes sense in a particular aspect, and it's not because they also make software.

Tesla is set to impart as transformational of a change on a number of gigantic industries as Netflix on broadcasting, Facebook on the way people interact socially, Google in the way the Web is organized, Amazon in how goods get sold.

What you're getting deceived by is that Tesla is working with a much, much more viscous medium then tech. Yes, it takes much more than just flipping bits to overhaul how we generate and consume energy or how we get around. But hey, Amazon went public in 1997 and they were back then a mostly tech company. Now they have warehouses, planes and a bunch of other "stuff" that makes their business work. It took almost 20 years to get there. Investors were very, very generously rewarded.

so you're saying Tesla can get GMs of 95% in Auto?

 

[Yggdrasill]

Why should I buy a car and pay to park it --> 96% of the time, insurance, parking fees, worry about theft, maintenance, fuel, taxes, inspections, car payments.
Could you use a raise of $1,000/month or more, by not having to spend it?
There are lots of articles and papers and novels detailing the future and a reduction in car use in cities and the change

Car use will increase, car ownership will decrease. But it will still be common to own a car.

Some reasons for owning a car:

- Specific performance
- Specific looks
- Personal additions and modifications (child seats, rear seat entertainment, extra lights, special tires/rims, toll RFIDs, bumper stickers, etc.)
- Don't need to worry about an angry owner if you spill something or make a mess
- Always ready in your driveway

In my view, autonomous driving will to a large degree replace the second and third cars outside the big cities, while in the big cities, more people will chose to not own a car at all.

 

[Drax7]

Reason for owning a car: convenience
We live in a convenience society.
People pay for convenience .
Convenience is time, the cost of time varies per individual.

Owning a car in some cities is inconvenient
Because parking is either very expensive or not available
Or alternatives are faster. Faster is more convenient.

 

[BobSk]

this may be slitely OT, but it points to things accelerating, small german company build electric delivery vans (1,000 of them) and irritates VW execs {and is a positive for EV's and possibly Tesla}
"“I am annoyed beyond measure. I, of course, ask myself why Post did not talk to our VW Commercial vehicles division about doing something similar,” commented CEO Matthias Mueller. “Let’s see if we can still get a foot in the door there.”

Deutsche Post Builds Its Own Electric Delivery Van, Volkswagen Execs Are Angry

If VW develops an electric delivery van, they probably will make it fail once every few weeks, then claim diesel is cleaner and more reliable.

 

[RobStark]

Why should I buy a car and pay to park it --> 96% of the time, insurance, parking fees, worry about theft, maintenance, fuel, taxes, inspections, car payments.
Could you use a raise of $1,000/month or more, by not having to spend it?
There are lots of articles and papers and novels detailing the future and a reduction in car use in cities and the change

Why would I want to spend ~$15 every time I get into a car?

That riding in a safe car will cost less than a stick of bubble gum is pure fantasy.

Cheaper to buy and own for 15 years.

Plus I can keep my stuff in it 100% of the time.

I don't worry about theft that is why I have insurance. I don't pay parking fees. Maintenance will be largely irrelevant in future BEVs as well as inspections. And the car will refuel itself.

Ride share services in lieu of car ownership will be popular in places where parking spaces monthly cost are what renting an apartment should cost( which is not where most of the population lives), for telecommuters, college students living in dorms, and retired folks. Not for people that use their cars every day.

 

[myusername]

Visited a data center for the first time today. Many many racks, many many UPSs and huge cooling units with under floor cooling. Center is of course on 24/7 and draws electricity. Solar energy and temp storage to time shift over high rate electricity times would be a huge cost savings for that company.

Cars are nice, solar cells and batteries are better-fewer moving parts, less service, large orders per site. Home use is miniscule compared to the industrial data center market. In my opinion only, i would not sneeze at this market, and some of you reading this may be able to pull a quick market research report on industrial solar and energy.

in data centers... a combination of diesel and -- flywheel and/or batteries are used... where flywheel UPS and batteries UPS are used to protect against small fluctuations and short term (-lt 5 seconds) power loss... 60 seconds on battery would normally be a long time in a large scale data center... by then, your redundant diesel generators would have kicked in... why not use batteries instead of diesel?... you can refuel a diesel generator while utility electricity is down and remain up indefinitely.

 

[myusername]

Visited a data center for the first time today. Many many racks, many many UPSs and huge cooling units with under floor cooling. Center is of course on 24/7 and draws electricity. Solar energy and temp storage to time shift over high rate electricity times would be a huge cost savings for that company.

Cars are nice, solar cells and batteries are better-fewer moving parts, less service, large orders per site. Home use is miniscule compared to the industrial data center market. In my opinion only, i would not sneeze at this market, and some of you reading this may be able to pull a quick market research report on industrial solar and energy.

btw... I was buying battery UPS for data centers 10 years ago... this is not new and disruptive.

 

[mrdoubleb]

Three questions, I'd appreciate some opinions.

What is the plant expansion for? It's clearly not for the early part of the M3 ramp. Any impact on the SP?

What will the SP be when Fremont is spitting out an M3 every 20-30 seconds and the Gigafactory is producing 25-50 gwh per year of TE products?

Will that be in 2017 or 2018?

Does the increase in the base price mean that an upgraded AP HW announcement is imminent?

Thanks!

So I was thinking about the same thing and there are a couple of things that come to mind - all are WAGs, of course:

- They could have decided, that there are too many downsides to building factories on other continents right now. Yes, transportation would be less of a hassle, but they would need to spread their top execs and financial resources thins as they would surely need to expat some of them to start up the new site for a couple of years and it would cost more too than expanding Fremont.

- "the obvious thing" we learn during Reveal Part 2 may also be Model Y, just 6-12 months behind M3

- They may already see an uptick in TE orders or will need more space to build the new Solar Roof product as Buffalo will do the PV only

 

[Yggdrasill]

Why would I want to spend ~$15 every time I get into a car?

That riding in a safe car will cost less than a stick of bubble gum is pure fantasy.

How so? If a 25k USD vehicle is depreciated over 200,000 miles/two years, that's 12.5 cents per mile. Add in electricity at 3 cents per mile, maintenance at maybe 2 cents per mile (basically just tires), insurance at 1 cent per mile, and 10% gross margin means a total cost of 20.5 cents per mile. Of course, on top of this there will have to be penalty fees for damage. And taxes would come on top of this.

I fully expect that in 2030 you will have an app on your phone where you can can select the type of car you want (even one-seaters, which will be significantly cheaper), click "come here", and if you are in a busy area a car will come to your location within one minute, while if you are in a less populated area the car will arrive within a few minutes. The vehicle is unlocked with the app, and payment is done via the previously supplied credit card information, immediately upon exiting and locking the vehicle.

 

[winfield100]

Car use will increase, car ownership will decrease. But it will still be common to own a car.

Some reasons for owning a car:

- Specific performance
- Specific looks
- Personal additions and modifications (child seats, rear seat entertainment, extra lights, special tires/rims, toll RFIDs, bumper stickers, etc.)
- Don't need to worry about an angry owner if you spill something or make a mess
- Always ready in your driveway

In my view, autonomous driving will to a large degree replace the second and third cars outside the big cities, while in the big cities, more people will chose to not own a car at all.

@Yggdrasill you may want to read the white paper from Rocky Mountain Institute (Amory Lovin's folks) about "peak car ownership"
I know a number of millenials (including 1 of my kids) whom have abandoned or never or rarely drive It looks like a "phase change" (she abandoned a paid off mini cooper!!!)
admittedly mine is a small sample
Peak Car Ownership
I think in our investing we need to consider the coming shrinkage as a result of level 5 autonomy, starting in cities.
Already at national harbor, SE of Washington DC, USA is an autonomous "proof of concept" taxi/12 passenger bus service started this summer
(and it is 3D printed) (summon it with a smart phone)
Olli - Local Motors

 

[Oil4AsphaultOnly]

btw... I was buying battery UPS for data centers 10 years ago... this is not new and disruptive.

The idea of battery backup isn't new, but the move to LI will change its applicability. There are plenty of datacenters that sit in tall buildings, and the permitting to site a diesel generator is super expensive. If 24-hrs of battery backup (LI has 4x the energy density of current SLA/AGM batteries) could sit within the data center itself, it opens up many options that weren't possible with the SLA/AGM batteries. That's whats new.

 

[myusername]

The idea of battery backup isn't new, but the move to LI will change its applicability. There are plenty of datacenters that sit in tall buildings, and the permitting to site a diesel generator is super expensive. If 24-hrs of battery backup (LI has 4x the energy density of current SLA/AGM batteries) could sit within the data center itself, it opens up many options that weren't possible with the SLA/AGM batteries. That's whats new.

i haven't looked into TE too deeply... but a 150kwh diesel generator can be purchased for about $25k... and the equivalent capacity in Powerpacks would be about $65k... I'm having a hard time understanding the cost argument.

 

[larmor]

i haven't looked into TE too deeply... but a 150kwh diesel generator can be purchased for about $25k... and the equivalent capacity in Powerpacks would be about $65k... I'm having a hard time understanding the cost argument.

What's new is time shifting to offset peak demand rates. Generators are for backup only. Battery storage with solar will save/bank/store energy to be used at the time of peak demand. A large business might make a capital expense for this, to save on daily high electricity rate charge from 9 am to 10 am every day.

 

[Yggdrasill]

@Yggdrasill you may want to read the white paper from Rocky Mountain Institute (Amory Lovin's folks) about "peak car ownership"
I know a number of millenials (including 1 of my kids) whom have abandoned or never or rarely drive It looks like a "phase change" (she abandoned a paid off mini cooper!!!)
admittedly mine is a small sample
Peak Car Ownership
I think in our investing we need to consider the coming shrinkage as a result of level 5 autonomy, starting in cities.

Interesting read. It brings up some points I hadn't thought about.

Already at national harbor, SE of Washington DC, USA is an autonomous "proof of concept" taxi/12 passenger bus service started this summer
(and it is 3D printed) (summon it with a smart phone)
Olli - Local Motors

I regard these concepts as pretty gimmicky. I don't think they provide a workable path to level 5 autonomy at 70+ mph. But they had an EZ10 concept here in Kongsberg for a few days, and at least the kids who tried it seemed impressed. That's something.

 

[JBRR]

Elon Musk on Twitter

"Tesla product unveiling on the 17th (unexpected by most), followed by Tesla/SolarCity on the 28th"

 

[techmaven]

Edit: Ninja'ed by JBRR!

 

[MikeC]

 

[anon]

No capital or debt raise! Stock is going to go crazy on Monday!!!

 

[MrRandyB]

Elon Musk on Twitter

"Tesla product unveiling on the 17th (unexpected by most), followed by Tesla/SolarCity on the 28th"

Powerwall 2.0?

 

[vgrinshpun]

Edit: Ninja'ed by JBRR!

Me too!