There are a few buyers who are eager to acquire Tesla. However selling Tesla is not in the secret master plan. This company will remain independent and become the largest company in the world.
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Elon has already made public a China factory in 2017. I think with incentives the cost of an assembly plant in China will be less than 500 million. ... LG will be making more of the electronics. ... and Panasonic will continue to increase capacity in Japan.
I think you have the right idea. An inexpensive car factory in China and cells made by Panasonic in Japan might be the fastest and cheapest path to expansion beyond the current plan of Gigafactory1/Fremont car factory to manufacture 500,000 cars/year by 2020. Markets in Japan, Korea, Hong Kong, China, Australia, New Zealand, South Africa and Singapore could all be served by a Chinese factory. Panasonic would have to undergo a major expansion of battery production in Osaka.
Monday is the fourth day of the month. We should have deliveries no later than Sunday.
Any number greater than 16,000 will be good, especially considering that almost all of the Xs were fully loaded. Pretty clear from this afternoon that the stock is under a major bear attack, which should continue into next week. I expect a bull-bear battle that the bulls will eventually win. The company and the cars are just too good.
dc_h
Active Member
GF1 should be on track to support US production in 2017, so Panasonic production has to go somewhere. Fremont is not likely to be over 100 or 200,000 model 3s in 2018. China can support local production. Demand will be immense with ICE driving restrictions. This could also drive demand for S and X production in China. Top status X and S and setting the bar with the 3 as the best aspirational car on the market. Well paid professionals will love every day driving, vs every other day ICE access. 300,000 seems very reasonable in China and Hong Kong. Moving final assembly and painting of S and X would also increase capacity, reduce wait ties, lower tariffs and costs. It also gets us on track for 1mm tesla's a year by 2020. That could reset stock targets to 500 next year.
jhm
Well-Known Member
Let me see if I understand you. You see a path to cumulative 500k Model 3 built by close of 2018. This path requires multiple auto plants to be brought on line in 2017. Is that fair to your outlook?Elon has already made public a China factory in 2017. I think with incentives the cost of an assembly plant in China will be less than 500 million. The new line in Fremont will also be about 500 million. The paint system and stamping presses are largely already in place in Fremont and their Chinese partner will offset capex for Tesla. I don't think any capital raise is needed in 2016 and to be determined if any capital will be needed to ramp up M3 to over 500,000 by the end of 2018. LG will be making more of the electronics. GF will be producing batteries and Panasonic will continue to increase capacity in Japan. Based on the fit and finish of the M3 test cars, they seem like they are going to be ready to move much more rapidly to initial production and scaling this up. The more out there option would be to move more manufacturing to Europe. If they have demand for 200,000 cars in Europe, local production makes more sense. A mass produced car needs shorter supply lines and faster delivery.
If they have at least two plants, the first 100,000 US orders should be delivered in the first half of 2018. If we get our 16,000 Q1 deliveries and Elon announces a second factory for M3 and signals 500,000 cars by 2018, I'm curious how that will affect the stock. I think with the employee cars going first, they may ramp up faster than expected. If they clear out the employee orders by the end of 2017, they will have a clean production process entering full steam in early 2018. This would push growth above 70% through 2020 and really get us back on track for blind faith pricing.
Having them on the same continent also allows the cars to deliver themselves.
I certainly see multiple factories as a requirement for long-term growth, but have not given much thought to opening a second factory as early as 2017. My concern is the ramp will simply take time, and I don't see how ramping at two factories at the same time makes it any easier. I was think of a cadence like the following.
2017 25k
2018 100k
2019 200k
2020 400k
So 400k reservations net more than 325k deliveries which leave Tesla booked through the end of 2019. I suspect that the time to bring a second factory online is maybe late 2018. The process needs to stabilized in Fremont before engaging a second facility. So the second facility does not a significant impact until 2019.
The cadence I set out is already quite fast. It mostly doubles every year. This really breakneck speed. I'd be curious if others see a way to accelerate this.
Elon continuing to spend his Friday night counting ...
Elon Musk on Twitter
Elon Musk on Twitter
Yuri_G
Member
You know Elon almost gave me a heart attack when he said there is really no car to show last night.
Our turn. Let's all ask for our refunds back. April Fool!
anticitizen13.7
Not posting at TMC after 9/17/2018
Closing in on a quarter million, which is unexpectedly awesome. Something is going on. Star Wars quote: "There's been an awakening. Have you felt it? The Dark side, and the Light."
It's not done until it's Monday morning (in CA). Weekends offer plenty of free time and social time. Many more people will learn and reserve.
So of all the tweets in the last day or so, I have to say I found the 42k ASP one the most interesting. That's significantly lower than I had been expecting, and also significantly lower than the percentage difference between S base and S ASP.
So this means one of two things: 1) Elon thinks the option take rate will be much much lower on the 3 than the S. This makes sense since there will probably be more price-sensitive customers, and he maybe got data from M3 vs. other 3 series sales (which I couldn't find with a quick search) and maybe there is a really low take rate on options in that vehicle segment so he's assuming that.
or 2) The performance model will be much cheaper than anyone anticipated. I was counting on 60-70k to compete with (and beat) the BMW M3 (which is 65k or so base, and can go into the 80s with options). But if any significant number of people are buying 70k Model 3s, then there's almost no way the ASP would end up at 42k - the math just doesn't work out unless we're talking about like a 5% take rate of performance models and very few compelling options inbetween. This is very very interesting to me.
I suppose there's also the possibility of 3) which is that there would be no performance model to compete with the BMW M3. But I just can't see that as happening.
So this means one of two things: 1) Elon thinks the option take rate will be much much lower on the 3 than the S. This makes sense since there will probably be more price-sensitive customers, and he maybe got data from M3 vs. other 3 series sales (which I couldn't find with a quick search) and maybe there is a really low take rate on options in that vehicle segment so he's assuming that.
or 2) The performance model will be much cheaper than anyone anticipated. I was counting on 60-70k to compete with (and beat) the BMW M3 (which is 65k or so base, and can go into the 80s with options). But if any significant number of people are buying 70k Model 3s, then there's almost no way the ASP would end up at 42k - the math just doesn't work out unless we're talking about like a 5% take rate of performance models and very few compelling options inbetween. This is very very interesting to me.
I suppose there's also the possibility of 3) which is that there would be no performance model to compete with the BMW M3. But I just can't see that as happening.
10 hours since his last tweet about 3K reservations per hour. I think this approximate rate might last a week => 3 * 24 * 7 + 232 = 736
So I have to ask: when someone says "major bear attack",
1. what does this really mean? just a bunch of folks spewing bad news or what?
2. how can you substantiate that vs. simply folks who had long positions taking profits?
1. what does this really mean? just a bunch of folks spewing bad news or what?
2. how can you substantiate that vs. simply folks who had long positions taking profits?
I can't substantiate but I infer when there is a sudden rush of high volume sell orders coupled with a lot of FUD headlines from the usual suspects in the media. Unlikely that profit-taking would be so coordinated.
LargeHamCollider
Battery cells != scalable
The media coverage of the M3 lines from major news outlets (the local ones were fine) seemed surprisingly light and tepid to me. This was a groundbreaking event buoyed by massive energy, anticipation and $$$.
The headlines did not reflect that energy for the most part.
The headlines did not reflect that energy for the most part.
And many more people will not want to be left out or will want to drive a Tesla THIS DECADE.
On the 31st, my wife called me and told me I could be late to the airport to pick up guests so I could shoot over and reserve a Model III in person and "be part of this." If 115k - 235k - ???? for a technology that currently occupies .1% of the market is not the beginnings of S-Curve growth - I don't know what is. Some people might have discomfort taking about and rooting for a $80K+ automobile and its manufacturer - but Tesla has just gone mainstream.
For those advocating the demise of Tesla, there will be a reckoning - hopefully in the form of a Tsunami. If you are against Tesla (until there is better competition for a compelling electric automobile) here is what you are for:
Pollution
Global Warming
The Koch Brothers
Car Salesmen
Political Contributions distorting the marketplace
Supporting foreign oil producing countries diametrically opposed to The West
Cartels
International Bribery
Exxon Valdez
BP Deepwater Horizon
The Ford Pinto
Blended Scotch and Torturing Puppy Dogs.
Try to get on the right side of history, people (Cory, John, Montana, Holman, Paolo....you know who you are).
As Doc Holliday might say, "It's not revenge (we're) after. It's a reckoning."
Sleep well early adopters, the next wave is coming.
Thanks for the reply! It seems like the thread consensus is that Tesla is unstoppable at this point? If funding is not a problem are there any major problems/risks left for Tesla?
JRP3
Hyperactive Member
You're ignoring the possibility of 4) Elon is wrong and the ASP will end up being higher than he imagines. He seems to have underestimated the rate of reservations after all.
Hope you don't mind, but I'm going to be a contrarian based on an engineer's perspective. To get a $35k model 3 (with high quality), there would have to be a significant amount of automation. Since Tesla has the space, why wouldn't they design and build out the assembly line with 400k model 3's at the get go?
Using the model X as a guide, do burst builds to verify and qc the assembly process, and then let it rip! With a target of 1k / week of model X by the end of Q2, and 2k by the end of the year for both X & S on the same line, Tesla basically went from assembly line completion to full operation in ~1 year.
If they did the model 3 assembly line with the intent of max production within the space available in Fremont, then wouldn't it be more like:
2017 5k (initial deliveries to meet guidance)
2018 100k (qc burst builds, automation fine tuning and verification; full speed by year end)
2019 400k (full speed production)
It just doesn't make sense to build out part of the automated assembly line to a lower speed and then increase it over multiple years. The model S was ramped that way, because there was quite a bit of manual work that got automated over the years. Can't see that process working out too well with the model 3.
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