Him reminding us that a SEC filing two days earlier contradicts Elon Musks tweet is very sober, useful and material information while everyone was lost in hallelujah fantasies about utility companies forking over a few billion to Tesla in 2017.
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Him reminding us that a SEC filing two days earlier contradicts Elon Musks tweet is very sober, useful and material information while everyone was lost in hallelujah fantasies about utility companies forking over a few billion to Tesla in 2017.
We started with comparing Tesla with GM, now we're in the other extreme and comparing to Priceline.
If Tesla delivers on their "alien dreadnought" type factory, they will actually look more like a tech company. There will be almost no manual labor, substantial part of the pie will be spent on engineering and design, they will have huge differentiation and captive markets across many aspects of business. Sure they'll have raw materials, buildings and tooling to pay for, but how are those different from data centers other than raw materials?
Here's another thing. If say Facebook wanted AirBnB's market, they would quite likely simply go and take it. If Google for whatever reason suddenly decided to take Priceline's market, they'd likely do that pretty easily too (maybe they'd have to wait for some patent to expire, not long at this point). Good luck taking Tesla with their R&D team, supercharger network, battery expertise and their manufacturing capability. It will take at least 10 years for an incumbent to even register on the competitive radar and at least 5 for an alliance of existing players. That is, if anyone can run that fast at all, which at this point doesn't look to be the case.
I've heard a lot of fantasies on how the money will appear in Teslas bank account. All slightly possibly at most just as plausibly that the cap raise deal was annulled because the market didn't react as hoped for on the Q3 results. Or even worse, that Q3 financials are actually not that good anyway, ie miss on profitability. It's even plausible that the cap raise is annulled because model 3 and associated cap needs are postponed. All just as plausible as a utility pre-financing a $4B TE purchase.
Mitch, Can you give me a link?
I gave up on SA long ago with the bear cases but if you have a quality bear argument site I will visit there from time to time.
I don' mind hearing all sides. Just don't get much out of perpetual FUD or cheerleading.
I like to stay informed on all sticks I own.
I think Elon has lots of cards. He will occasionally show a card when he thinks it's an appropriate time. The biggest card probably will not be shown anytime soon. If it were shown, the earnings expectation would change a lot overnight.
Mike Smith
Active Member
The only explanation that fits is that they're unveiling the model Y. They could charge 2k for reservations and expect to receive 300,000, for $600m raised which, along with earnings in q3 and powerpack 2.0 pre-payments is why they no longer need cash.
CALGARYARSENAL
Member
Many of these "fantasies" make sense. There are mergers/acquisitions and minority stake investments in other companies all the time, let alone the most innovative company in the world.
But why would they make the Model Y announcement virtually last minute when they've telegraphed almost a month in advance the solar roof and new PowerWall? That makes no sense to me.
So what, a bit under $220 by end of the week? No delusion in Q4 and 2 product announcements..
Just parking cash in someone's equity doesn't move the needle on any corporation's "leading vs. following" scoreboard. There's no intersection between Microsoft and Tesla's core competencies. Your statement makes right about 0 sense.
Off Shore
Off Topic Member
Also, IMO, people like the current troll-designee are either not very smart (unlikely) or being paid.
My best guess for the announcement is they are ready to show their new AP hardware package. But I'd give it maybe 10% chance of being correct.
I think there might be something to this; Musk was clearly hoping for a higher share price in Q4 and that didn't seem likely without that tweet. We also know from before that the money likely wasn't needed until sometime in Q1 2017 anyway, so perhaps they have worked out a way to delay it further (perhaps with some other financials that have turned out a bit better than expected) to give them time to have another go at trying to move the share price up again.
Mike Smith
Active Member
The 'second pie hidden behind the back' trick only works if it's totally unexpected.
Thumper
Active Member
Possible product: a fold-flat second row option for the X for people who want to haul more stuff instead of kids. Super easy to do and some would prefer it. Unexpected.
Sure. But that the planned cap raise was annulled because the stock didn't react to the numbers as hoped for is just as plausible, yet no one is even considering it as a possibility. Or that the money is needed only a quarter of two later because the model 3 is delayed by that time frame.
if there is not evidence of other financing soon... then the questions I was asking earlier will eventually be asked. the headlines are going from "Tesla doesn't need cash!"... to "why did Tesla need cash before and now it doesn't?"
Despite Recent SEC Filings Musk Says Tesla Doesn't Need To Raise Funds This Year
Despite Recent SEC Filings Musk Says Tesla Doesn't Need To Raise Funds This Year
No, not really at all. Pointing to SEC language with enough hedging to create a privacy fence is something you do when you are desperate and trying to create confusion. Properly drafted disclosure (as here) describes current state of things while allowing plenty of leeway to ultimately do whatever he wants.
It's obvious to anyone not trying to twist the language like a contortionist that something has fundamentally changed with the cash position. He essentially put off raising cash for 6 months during the most capital intensive period of the company's lifecycle. Something's up.
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vgrinshpun said: ↑
For example, if it TE signs agreement with a large utility, say Oncor of Texas for supply of 10GWh of BES througout the 2017 with upfront payment in return to heavily discounted price, say $350/kWh instead of the list price of $445/kWh, it can bring $3.5B in cash upfront, with $1.1B of this payment being gross profit, ensuring, as I speculated earlier profitability in 2017.
The upfront payment/most probable scenario is unlikely to come from Oncor! Oncor's majority owner (80%), Energy Future Holdings, has filed for bankruptcy protection. How is Oncor Protected?
The "ring fence" was as much about regulatory separation as it was about creditor protection. Texas/ERCOT has a bifurcated structure: Generation (in most of the state) is competitive and largely unregulated (other than ERCOT's role). Transmission and Distribution (T&D) utilities are regulated by the Texas PUC, because of the old regulated monopoly concept that economic monopolies are entitled to a return of and a return on their investments. Figuring out what is "fair" for the return of and on is a ponderous, expensive, time-consuming process.
The process is complicated by the reality that in a bifurcated market, stationary storage is a hybrid--neither fish (unregulated generation) nor fowl (regulated T&D).
The consequence of the bankruptcy coupled with the regulatory conundrum means Oncor is unlikely to buy 10 Gwh of battery storage anytime soon.
(The old-timers at EFH/Oncor from the time when TXU was an integrated, regulated utility still have scabs over wounds from "prudency" hearings about Comanche Peak.)
For example, if it TE signs agreement with a large utility, say Oncor of Texas for supply of 10GWh of BES througout the 2017 with upfront payment in return to heavily discounted price, say $350/kWh instead of the list price of $445/kWh, it can bring $3.5B in cash upfront, with $1.1B of this payment being gross profit, ensuring, as I speculated earlier profitability in 2017.
The upfront payment/most probable scenario is unlikely to come from Oncor! Oncor's majority owner (80%), Energy Future Holdings, has filed for bankruptcy protection. How is Oncor Protected?
The "ring fence" was as much about regulatory separation as it was about creditor protection. Texas/ERCOT has a bifurcated structure: Generation (in most of the state) is competitive and largely unregulated (other than ERCOT's role). Transmission and Distribution (T&D) utilities are regulated by the Texas PUC, because of the old regulated monopoly concept that economic monopolies are entitled to a return of and a return on their investments. Figuring out what is "fair" for the return of and on is a ponderous, expensive, time-consuming process.
The process is complicated by the reality that in a bifurcated market, stationary storage is a hybrid--neither fish (unregulated generation) nor fowl (regulated T&D).
The consequence of the bankruptcy coupled with the regulatory conundrum means Oncor is unlikely to buy 10 Gwh of battery storage anytime soon.
(The old-timers at EFH/Oncor from the time when TXU was an integrated, regulated utility still have scabs over wounds from "prudency" hearings about Comanche Peak.)
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@AIMc
here is link to about only author worthwhile i read on SA anymore. engineers POV, otherwise a bunch of "hoohah"
http://seekingalpha.com/article/4001134-tesla-already
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