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There was a widely admired series of television advertisements in the decade of, if I remember correctly, the 1980s. The punchline was "When E.F.Hutton talks, people listen". Cute series of ads.
And it's true. I'm not going to name names, but use an hypothetical. The top-rated analyst, year-in and year-out, of the scuba diving industry bases herself out of southern Florida and refuses to leave. She began her career at DeweyCheatham&Howe in Boca Raton, and by gumbo and ocean rising, she's going to stay there.
ALL the other scuba analysts pay attention to her wisdom; ALL institutional investors who place money in the industry listen to what she says. Now: when AirTanksRUs comes to the markets to raise capital? Sure, they're going to hope to have JPMorgan and UBS in the underwriting pool, and if they're lucky they'll get Goldman to be the lead underwriter. BUT - 9 times out of 10 they also will include Dewey in the underwriting because that's their specialty.
So she retains her pedestal at the top of the scuba world; her firm gets some underwriting business and there is spillover trading business, and we all get to breathe, underwater, a little easier.
As long as the share price isn't underwater....
jgillispie
Member
Wall Street certainly doesn't like risk and that's the reason why we're trading quite a bit lower than before the 500,000 vehicles/yr. was moved up two years and the SCTY merger was proposed. It was also before Trump won the presidency. What transpires, though, is that the perception of risk gets lessened if Tesla makes the right moves, which it is doing. We now see with various European initiatives to move towards EVs that moving up volume production was the right thing to do. The SCTY merger has been derisked by SCTY moving away from short-term financed PPA and moving towards an innovative roof that the competition won't be able to match for quite some time and which will be paid for in full at time of purchase. The Trump presidency is also being derisked as Elon points out how subsidies actually help Tesla's competitors more than they help Tesla and we have so far seen no evidence that Trump intends to treat clean energy companies in a negative fashion.
The perception of risk diminishes as Tesla gets closer to making money with its big investments. When the gigafactory soon begins turning out 21-70 cells plus powerwalls and powerpacks in respectable numbers, we know that the investment in the gigafactory is starting to pay off. When Model 3 remains on track and as Tesla gets closer to launching the vehicle, investors feel that derisking is happening and the stock price will go up.
I seriously doubt there will be much of a gap in between the revealing of options, and deliveries as there was with the Model S. Also remember, the Model 3 are already being spotted around the country. The biggest unknown will be what features are included with the base model, what surprise features will be available, and what the different models will cost.
100% confident Tesla will be on or ahead of schedule.
This talk about solar roofs to me, is a bit tiresome. It's simply too far out. I don't think solar roofs are a 2017 thing, much like Tesla Energy was not a 2015 thing. It was important to start the conversation... after all, Tesla Energy couldn't be looking at many 10's to 100's of MWh's of deals in 2016/2017 without that groundwork. So the Tesla discussion about solar roofs is really about getting the solar installation and roofing industries to talk to Tesla/Solarcity as well as get customers prepped. If you are starting to think about replacing your roof, then you might hold up waiting to hear more about solar roofs. But as an investor, I don't think it will be baked into the sp any time soon.
I was frustrated that the Q&A mostly concerned the solar roofs. I would rather have had questions about Tesla Energy as well as how Tesla/Solarcity moves forward with existing Solarcity operations. That's the real meat ahead of Model 3. Much more important is the cash flow, and how Solarcity's ops affect it going through Model 3 ramp. I know they said some things in the past few weeks, but I would rather have had Mr. Musk drive those points again during the presentation and Q&A yesterday. Not once did they talk about landing the big Tesla Energy deals as a combined company and how that makes thing easier, leading to more sales and profit.
I was frustrated that the Q&A mostly concerned the solar roofs. I would rather have had questions about Tesla Energy as well as how Tesla/Solarcity moves forward with existing Solarcity operations. That's the real meat ahead of Model 3. Much more important is the cash flow, and how Solarcity's ops affect it going through Model 3 ramp. I know they said some things in the past few weeks, but I would rather have had Mr. Musk drive those points again during the presentation and Q&A yesterday. Not once did they talk about landing the big Tesla Energy deals as a combined company and how that makes thing easier, leading to more sales and profit.
... and the big bad wolf huffed, and he puffed, but he could not blow the house down because the piggie had built it out of bricks with a gorgeous Tesla roof and while the wolf tried his mightiest, the little piggie sat back in his easy chair and watched the football game on TV powered by that wonderful roof and a Powerwall 2.
2017 and 2018 will be the years Tesla will show its ability to produce all of the above at significant volume. Solar + Storage will be more significant than the Model 3.
It's very clear how this will play out. Also, Battery storage only qualifies for the ITC and certain other incentives if paired with Solar. This will reduce the cost of the Powerwall to $2000-4000. Almost every person with Solar, especially the people who are SolarCity customers, will want to buy a Powerwall.
I just tried to be funny ... and I agree its interesting stuff
btw. The thing at the end of the video. I trolled my history teacher so hard with "No Mr.Teacher Holy Roman Emperor Otto III is made up and we live in the year 1716"
Phantom time hypothesis - Wikipedia
Why does that mean anything about the production schedule?
IIRC "pencils down" was in July - so they certainly could have had a reveal 6 months after that without it meaning anything about the production schedule.
Your comment has nothing to do with my comment and doesn't make sense. "Pencils down" date has nothing to do with what options will be available or what the final product will cost. Tesla won't release pricing until close to production to minimize any effect on Model S and Model X sales.
Really? I have seen that there have been a few spottings for the 2 alpha cars, but not very many, and no pictures to speak of... Or did I miss all of them somehow?
He said the final unveil of Model 3 is coming in 3 or 4 months. That's when we will will know what the final interior will look like. Probably spaceship like
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The #1 biggest catalyst coming up is first cell production coming out of the Gigafactory. Matter of fact, the more I look at it, the more I am convinced that the PowerWall 2 pricing comes directly from the Gigafactory operations. The initial batch of products might be from outside sources, but really, PowerWall 2 in Q1 and Q2 is about the ramp of the Gigafactory. I haven't really looked at the PowerPack 2, partially since we don't actually have good numbers for PowerPack 2 in quantity versus retail.
In other words, it might be that Gigafactory becomes operational for cell output in December, and certainly by January. No more can it be called a gigglefactory by the shorts. And all that capex will finally start bringing in some serious revenue.
Coming up right after that is Q4 delivery numbers, and thus far things appear robust. That includes the AP2 related ASP and gross margin bumps, as well as increased Model X mix. It is interesting for me to watch FX issues, especially that the cells from Japan are getting cheaper again (and conversely, selling overseas is more expensive). The difference between yen weakness and euro weakness is interesting to me.
We then start to get PowerWall 2 installs, which should be very interesting in places like Hawaii and Australia amongst other places.
Somewhere after that is the start of the awakening of AP2.
And then we get Q4 ER.
And then we start to really see Model 3 ramp evidence... Fremont factory changes, Model 3 additional reveals, etc. By the time we get into summer, we'll have a much better idea of how the TE ramp is going as well as how the Model 3 ramp is going. All of this before the Tesla Buffalo plant comes online. I suspect the initial volume product out of there is traditional solar panels, but with combined Silevo/Panasonic technology. The cell creation is first... and it is easiest to put it into traditional panels.
We are about to have a very interesting 9 months ahead... lots of risk, lots of potential upside.
In other words, it might be that Gigafactory becomes operational for cell output in December, and certainly by January. No more can it be called a gigglefactory by the shorts. And all that capex will finally start bringing in some serious revenue.
Coming up right after that is Q4 delivery numbers, and thus far things appear robust. That includes the AP2 related ASP and gross margin bumps, as well as increased Model X mix. It is interesting for me to watch FX issues, especially that the cells from Japan are getting cheaper again (and conversely, selling overseas is more expensive). The difference between yen weakness and euro weakness is interesting to me.
We then start to get PowerWall 2 installs, which should be very interesting in places like Hawaii and Australia amongst other places.
Somewhere after that is the start of the awakening of AP2.
And then we get Q4 ER.
And then we start to really see Model 3 ramp evidence... Fremont factory changes, Model 3 additional reveals, etc. By the time we get into summer, we'll have a much better idea of how the TE ramp is going as well as how the Model 3 ramp is going. All of this before the Tesla Buffalo plant comes online. I suspect the initial volume product out of there is traditional solar panels, but with combined Silevo/Panasonic technology. The cell creation is first... and it is easiest to put it into traditional panels.
We are about to have a very interesting 9 months ahead... lots of risk, lots of potential upside.
FredTMC
Model S VIN #4925
There's been no Model 3 sightings other than the pre-alpha cars used for the test rides at the M3 launch event.
There is a thread on here for pictures of Model 3 spotted.
Also:
Tesla Model 3: rare sightings of prototypes that you might have missed
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With the deal closed and no more need to "sell" the vision, I'd just as soon keep the TE cards close to the vest right now. For once, just once, I'd like Tesla to surprise the street with good news that hasn't been overly telegraphed.
All analysts are assigning it very little value. With plenty of TE ramp to assess by the Q4 call in early Feb, I'm expecting separate 2017 TE guidance. If they can point to concrete evidence of their ability to execute a steep production ramp - in addition to what looks like very high demand for cars - the Q4 call could be special. This is especially true if they are able to do it on the cheap again and come in significantly under the capex and opex guidance while maintaining the Model 3 launch date and SCTY cash positive projections.
If we really want to be pedantic about this, the matte black/carbon Model3 is clearly a pre-alpha. The silver is a much later alpha. The red is a mockup. We are unlikely to see anything else until spring. Note that they can use Model S mules to test significant amounts of the tech that goes into the Model 3. Also, Tesla indicted that the drive train in the prototypes are "production", so maybe beta level in that department. And in some ways, they are already incorporating changes into the Model S/X production lines that come from Model 3 technology development.
They might still be sort of sandbagging a little bit with that stuff because they walk kind of a fine line with many of the utilities trying to find a way to coexist and not outright disrupt an industry that not used to having competition. It's probably better to just speak softly and not wave that big stick around too much. It's much easier to work together than to actually sandbag them.
The cell production talk reminds me that we should be starting to hear more about big power wall deals unless they want to do them covertly for some reason. If it's only a few months away from big production you'd think they should already have inked deals or be close, and there was a statement from q3 earnings? saying they were in talks for multiple projects.
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