Short-Term TSLA Price Movements - 2016

[Curt Renz]

hi all, long time lurker first post!

I was wondering if anyone has any insights on production schedule given the ridiculous amount of reservations? I read that tesla has capacity to produce ~80k cars this year, up 60% increase in production from 2015. If they continue to increase production by 60% every year they'd be able to produce 500k a year by end of 2020. Say reservation tops out at 300k by end of april, this alone will eat up their production capacity for the next 2 years and that is excluding Model S and X deliveries.

Optimistically say their production capacity is 130k in 2017, 30-40% of it is allocated to Model 3, which means if you are placed ~50,000th you would have to pick up in 2018, and if you ordered today (~200,000th) you wouldn't be able to pick up till 2019. Does any one see this as a problem?

See my response made earlier this afternoon: Short-Term TSLA Price Movements - 2016

 

[Electrifying]

The reservation numbers and higher share price should have Wall Street bankers crawling over each other with competing offers to provide favorable financing for more rapid development of Gigafactories, assembly plants, service centers and Superchargers. Elon appears to be angling for that.

Curt, do you think Tesla could get cheap debt financing (a couple $ billions) now based on these pre-orders? That would be better than diluting equity raises. I think the stock could soar if a debt deal is announced.

 

[sub]

He is trying hard to pop the stock, but he claims he isn't worried about stock price There are double bookings in this count. Some people reserved multiple cars (a father-son duo reserved ten in store). When Elon said "Model 3 orders, whether in store or online, are limited to two per person", did he mean minimum of two? Glad to see the Tesla software engineers help out Elon with the reservation count.

But don't worry. The reservation count will vanish from quarterly reports, just like the Model X reservation count that vanished long ago. Or the Powerwall count.

So you have evidence of one over booking and assume? I reserved 2, received confirmation for 2 and was charged for 2. Typos happen, but yeah, go ahead with your conspiracy theory with the depth of data you have.

I saw a sign posted that said it was a limit of two per person per visit. If you wanted more than two you had to get back in line and reserve again. If nobody was in line?

Good luck with your investing, aka grasping at straws.

 

[Intl Professor]

Who else loves the rims on the model3?

Probably good at cutting corn fields to size. Despite the ostentation, I liked them. A question for you fluid mechanics types, could a windmill effect increase stability of the vehicle?

 

[BobSk]

Amen brother. Besides Adam J owes us an upgrade after all his BS last year. Plus full autonomous Uber killed is probably coming in Elon model 3 part duex

The autonomous Tesla sharing is definitely coming. Elon thinks big and do big. He knows what makes sense. It doesn't make sense to announce now.

 

[tanner]

So you have evidence of one over booking and assume? I reserved 2, received confirmation for 2 and was charged for 2. Typos happen, but yeah, go ahead with your conspiracy theory with the depth of data you have.

I saw a sign posted that said it was a limit of two per person per visit. If you wanted more than two you had to get back in line and reserve again. If nobody was in line?

Good luck with your investing, aka grasping at straws.

Yeah, I ordered 2 and received a confirmation for only two as well... Also a family member reserved one and merely received a confirmation for that one res. I highly doubt something fishy is afoot.

 

[drinkerofkoolaid]

Random question. Did anyone else get the feeling the roof of the Model 3 being one continuous pane of glass means Tesla is probably working with Apple?

 

[Curt Renz]

Curt, do you think Tesla could get cheap debt financing (a couple $ billions) now based on these pre-orders? That would be better than diluting equity raises. I think the stock could soar if a debt deal is announced.

The company should be able to get quite favorable financing offers based on the reservations. However, all offers would have to be considered to determine which type of financing is most advantageous to current shareholders. It could be one that involves convertible bonds, i.e. IOUs that could be converted to common shares if certain conditions are met.

Dilution should only be a concern to distressed companies. New shares created by a successfully expanding company bring in cash that is mutually owned by all shareholders. If that cash is efficiently employed for development, it enhances rather than hurts the share value.

 

[BobSk]

Yeah, I ordered 2 and received a confirmation for only two as well... Also a family member reserved one and merely received a confirmation for that one res. I highly doubt something fishy is afoot.

I ordered 2 and got confirmation of 2, charged $2k. I wish they charge me $4k and booked 4 cars under my name. I asked but they said 2 is a firm limit. If Tesla really want to see high number, they would allow each person to reserve 10.

 

[drinkerofkoolaid]

Another thing. Today was an Opex day and there were a crazy number of $240 calls. A lot of investors were betting on a big move the day after the Model 3 unveil. This was probably partially responsible for the stock closing below $240.

On the plus side, the move today technically negated a head and shoulders and made the chart look even more like a perfect inverse head and shoulders.

 

[Johan]

I just celebrated my wife's birthday, got up early to watch the reveal (5.30 AM) and since seeing that sexy car and hearing Elon say "yes, it will be $35k, yes autopilot is standard, yes supercharging is included in the base price" my day has been great! Made out like a bandit in short term calls on market open. Had a great dinner just now a few bottles of great wine. Then I go on Twitter and TMC and see that we're rounding 200k reservations. That's what - the first 2 years of production sold out? Wuuuut? This is unprecedented in the automobile industry. This is not a $600 dollar piece of handheld junk we're talking about, it's an ASP $42k car (mark my words ASP will be closer to $50k, just look at how surprised Tesla were with ASP for Model S and the discontinuation of the 40 kWh). Upgrades are coming next week, they're just waiting for good Q1 delivery numbered, for good measure. Good night and congrats to all smart longs.

 

[sub]

I need some help bridging the gap to my two model 3's. Our i3 lease runs out June 2017.

I've thought of a few possibilities, lease another one, lease a bolt for 2 years (please no) or buy a Tesla CPO Mod S and sell once I have my Model 3's. Not sure how these three options compare financially but of course I would prefer to buy the model S. Advantage of this, it moves me up in the Model 3 line correct? I haven't seen CPO owners mentioned specifically.

 

[drinkerofkoolaid]

The company should be able to get quite favorable financing offers based on the reservations. However, all offers would have to be considered to determine which type of financing is most advantageous to current shareholders. It could be one that involves convertible bonds, i.e. IOUs that could be converted to common shares if certain conditions are met.

Dilution should only be a concern to distressed companies. New shares created by a successfully expanding company bring in cash that is mutually owned by all shareholders. If that cash is efficiently employed for development, it enhances rather than hurts the share value.

Tesla is probably finalizing a lot of deals over the next week. Tesla is in a very strong negotiating position.

 

[Naah]

See my response made earlier this afternoon: Short-Term TSLA Price Movements - 2016

Is it economically feasible to scale that quickly?

Say they want the first 200k Model 3's and another 200k model S & X to be delivered by end of 2018. They need to up their production by 400% by end of 2018. Their CapEx for 2015 is $1.6 billion which means they need to raise at least another $6 billion in order to fulfill this (I'm just guessing here with simple math btw I'm no analyst). Who's gonna give them this kind of money when many firms are still skeptical about BEV and major competitors trying to kill them all the time? Remember gigafactory alone is a $5 billion investment through 2020, and that's only expecting 60% growth year over year. Not to mention the insane amount of logistics involved in equipment and people they have to add. Does this make sense or is my analysis too amateurish?

I have no doubt Tesla's demand is extremely strong and they'll sell every car they can make, but I guess my question is whether their inability to fulfill the demand affect them negatively in anyway?

 

[Intl Professor]

Possibly slightly off topic takedown of BYD competition FUD or just something to read while the stock completes its U-turn into an all-out rally.
View attachment 170014 Little photo of yours truly in a public area of BYD Shenzhen.



The other thing about BYD is a strategic error. Lacking IMO a credible internal driver of innovation and basically reliant on being a contract engineering house with massive access to cheap labor (200,000 employees spread over seven sites at the time) for third party innovators to tap into - what they have actually done is employ a strategy of trying to compete with their customers to the point that they are difficult to trust in a way that Foxxconn with its Taiwanese management isn't.
snip

This is not the Tesla competitor you are looking for.

I bought this on news of Buffet's investment in the company. What was he thinking? He has said, if I remember correctly, he doesn't know much about tech (or some such). Most of my stuff is now in hands of a wealth manager. He sold BYD right away.

 

[doctoxics]

Is the general consensus that TSLA will release Q1 numbers over the weekend/Monday? Forecast?

Tesla said they would release quarterly deliveries by the third day following the end of the quarter; that would be by Sunday. Last quarter, they announced deliveries on the second day following the end of the quarter.

 

[FredTMC]

Hey, question about the Model 3s used for the reveal and test drives yesterday.
Also, question about building these prototypes.

1). Was there more than 3 of them used for test drives?

2). How many total Model 3s were at the event

3). How in the world do they make these cars? I know "by hand"... Not assembly line... but how are the panels made and how is the subframe made?

Maybe they already have the "dies" for the sheet metal presses.

I guess you just weld by hand instead of robot welds to build subframe and frame

 

[Svetlin]

I need some help bridging the gap to my two model 3's. Our i3 lease runs out June 2017.

I've thought of a few possibilities, lease another one, lease a bolt for 2 years (please no) or buy a Tesla CPO Mod S and sell once I have my Model 3's. Not sure how these three options compare financially but of course I would prefer to buy the model S. Advantage of this, it moves me up in the Model 3 line correct? I haven't seen CPO owners mentioned specifically.

I'm in the same boat, Volt lease ending this summer. Debating between another Volt lease or a CPO Model S. I've promised myself to not splurge on the Model S unless TSLA is above $400 by August... but I'm not so good with promises.

Anyway, I asked the sales guy at the store yesterday if buying a CPO Model S will move me up in the queue for Model 3, and he said "I don't think so". I think he just didn't know and didn't want to promise me something that would turn out to be wrong.

 

[madodel]

You really think Tesla intentionally did double booking to pop up the stock price? Anyone who has this kind of mentality has high risk to lose.

You are just feeding the troll.

 

[Intl Professor]

I don't think Model ≡ will effect Model S much at all. Actually one person I know who will be test driving my car tomorrow has decided that since he is in the upper 100K reservation range and doesn't want to wait THAT long he most likely will just get a base Model S. SO if anything the Model ≡ has made people aware that the Tesla product IS within their grasp. Particularly in the CPO market... right now. THis is good for Tesla and the stock price.

snip

If I were younger I could buy either an S or X without taping anything but about 3/4 of my social security check. We reserved 2 M3 yesterday, one possible for either my son or my brother who would take over. If the market goes up substantially because of TSLA I would feel better about getting an X and might then keep the M3 reserves for relatives or apply toward the X. Not interesting, except for an n of 1 who would likely switch as you suggest.