Short-Term TSLA Price Movements - 2016

[Krugerrand]

A few of my friends used to be interested in M3, now are afraid of the long wait time, so they gave up.

Then they weren't really all that interested to start. It's just that simple. If someone really wants something, waiting isn't an issue other than there being a 'specific and immediate *need*' to fulfill in the moment. And like I mentioned, there's ways to cover transportation until one's turn comes up for a 3.

I don't think many car buyers had experience of wating for several years from reservation to delivery except loyal S/X owners.

Most of those S/X owners never waited several years for a car prior to their Teslas either. So the various reasons that had them patiently (and not so patiently) waiting for their cars will be the same various reasons for the next set of new Tesla owners.

The only way TM resolves the issue is to raise billions of fund not only expedite the M3 factory build progress but also increase the capacity to say 1 million cars by 2020. Elon already mentioned "need to rethink production planning", so it won't be supprised to see above happens.

Elon and those at Tesla have shown great capacity to be creative problem solvers. I'm sure they'll work it out like they do everything else.

 

[sundaymorning]

Bottom line that bears have to offer today in a counter argument: the M3 is bad for Tesla.

This is very much like 2013 again. Many investors who sold Tesla at 150s all the way to 220s will simply be left behind in an event of a beat come Monday. Chasing of the price upward will eventually capitulate short term investors. Like the Coco Cola auntie, they will come to regret this mistake for the rest of their life. Of course, longs could be wrong and we see a miss come Monday, but then that's the perk for being long, we can afford a few misses here and there all the way till 2025.

 

[sub]

I'm happy I decided to reserve at a store rather than wait to reserve online, 232k! I think any long time TMC member (1 year+) that didn't reserve in person (assuming they are buying and reasonably close) should have their TMC membership reviewed

I saw the Model X for the first time, parked right next to one. As the driver got out I asked him how it was going, he said fantastic. He later pulled his Model X into the Tesla parking lot and let anyone interested look at the car. I was a little annoyed at how disrespectful some people were, sitting in the car without asking, but that is another topic. I did forget to look up at the front windshield, duh. The fwd worked great.

I bring this up because I thought the Model X had removed any interest I had In the Model S but having seen both in person I can see how they really cater to different needs. Model 3 will be the same.

I do think the model 3 needs a small update however, give it an X/3 nose refresh and I have no doubts sales would increase (not that it's needed).

Has Tesla released news on a Sunday before? Planning to increase the TSLA position In my margin acct ~20%, would like to do that before the next leg up.

 

[Tslynk67]

I am quite sure the interior isn't final. The lack of instrument cluster is... a problem; they'll have to line up that center screen a bit differently to make sure the speedometer is readable at all times, including with high glare.

I would have thought an easy solution to this - and also to make the car easier to produce - would be to put the screen on a gimbal so it can be angled in any direction, thus catering for tall/short drivers, left/right-hand drive vehicles.

I do think the model 3 needs a small update however, give it an X/3 nose refresh and I have no doubts sales would increase (not that it's needed).

I actually like the nose, but then I realise why it is as it is - aerodynamics. However I see a lot of grumblings about it from the masses, so they might want to tweak it a bit prior to full production.

Also they ought to convert the car to a hatch-back, if possible. It's just not very practical as it is and a lot of people won't buy it because of that. For this I was thinking they could spit the roof glass where they have the beam and have it open from there. However, would add cost, I imagine - could perhaps be a nice option to to have available for those that want to pay.

 

[neroden]

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:

I pick the fourth option. Elon is making a conservative estimate, because he is angling for a *loan against future revenues* at a good interest rate, so that he can make even more capital expenditures without diluting the stockholders.

 

[neroden]

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?

Oh yeah, they could screw up the execution. That's always a risk. I don't think they will, but they could. If there are terrible problems ramping up which last for years, or they have unexpected design defects which take years to figure out (as they did with Model S), they could have problems. (I think they worked out all those design issues on Model S, though.)

 

[Fallenone]

That's certainly one way to think about it. The other way is that the bigger the number gets, the more people panic they won't be able to get one in a timely manner and thus will reserve.

And no, the tax credit doesn't just go away. It gets reduced.

People are notoriously resourceful. For instance, my reservation is in and there's not a chance my current vehicle can last until my turn comes up for the Model 3. Guess what I'm going to do? Here's a couple of options:

1. Buy a used vehicle to tide me over
2. Lease a vehicle to tide me over

Please do tell us, though, what exactly is the 'big reservation number' that will cause people to stop reserving.

I guess those hesitated people are being "squeezed" to place their reservations

 

[neroden]

The last automobile which sold like this -- with no advertising, and selling faster than they could make them, for years on end -- was the Ford Model T.

 

[Larken]

Correct me if I'm wrong, as I'm not a M3 reservation holder. But in response for the people saying the wait list is growing so big that people get discouraged and don't want to "wait" for the car. I'm assuming most people would reason like me, in that I don't consider it "waiting" for anything. I just plunck down $1,000 and forget about it. Life goes on, I keep driving whatever I drive or get a car to bridge over the "wait" and when my number gets called I get the M3. There's no actual "waiting" involved, if you have the right mindset. Of course, I can see how some people will be put off by the waitlist, but I think that's a minority, so I expect the M3 queue to keep growing and touching 1 million before the end of this year.

 

[Fallenone]

I actually like the nose, but then I realise why it is as it is - aerodynamics. However I see a lot of grumblings about it from the masses, so they might want to tweak it a bit prior to full production.

It's clearly X style. When I first saw the nose of X, I wasn't sure about it, looks weird. It took me some time to like it. And when I saw it in person, I started to think the fake grill on the S was not necessary. I think the same process would go for the 3's front for some people.

 

[Fallenone]

Correct me if I'm wrong, as I'm not a M3 reservation holder. But in response for the people saying the wait list is growing so big that people get discouraged and don't want to "wait" for the car. I'm assuming most people would reason like me, in that I don't consider it "waiting" for anything. I just plunck down $1,000 and forget about it. Life goes on, I keep driving whatever I drive or get a car to bridge over the "wait" and when my number gets called I get the M3. There's no actual "waiting" involved, if you have the right mindset. Of course, I can see how some people will be put off by the waitlist, but I think that's a minority, so I expect the M3 queue to keep growing and touching 1 million before the end of this year.

The only people that would be put off by the wait list would be those who are trying to get the $7500 tax credit and see this as a must. I talked to about 10 people in the line I was in, 8 were not even aware of the credit will phase out. And if you are aware of the phase out, and not getting that credit will make you not buying it, you won't put in a reservation after hearing the 115k number. The fact the reservation number doubled in less than a day after the reveal indicates people are reserving without having the tax credit as a must factor.

On the Model 3 sub-forum, when Tesla announced R/S/X owners would have priority, there were a lot of future first time Tesla owners not happy about it. But I don't remember seeing many (if any) saying they are not going to reserve, major impact would be fewer options, but still an order.

 

[Fallenone]

The unemployment rate I was referring was hypothetical and in an event of a slowdown in China. Even at the current 4% that you've stated, you are looking at 60 million unemployed in China. With rumors of the Chinese market slowing down a bit, that number can easily double in a recession similar to what we've experienced here in the US.

There's only one Tesla right now, but plenty of other hard working Asian or 3rd world markets begging for a company like Tesla to enter. India, Vietnam, etc.. There will be politics and obstacles in every country, but how do you think Mercedes, BMW, or GM got into China in the first place?

As far as incentives are concerned, the reason Tesla is treated unfairly is because they don't yet have a manufactur in China, this is the biggest hurdle and could easily be rectified with waiving a gigafactory carrot in front of the Chinese. Why should the Chinese give Tesla anything when Tesla offers zero incentives for China? Well Mr. China, I now want to put a fraction of your 60 million in a high paying job. No I'm not talking about sweat shops, I'm takin manufacturing, engineering and technology! Now we're talking..

Makes sense. No factory, no incentives. Thanks for the thought.

Perhaps the world was waiting for the Tesla reveal in March, and we're not interested in looking elsewhere. This explains why the auto industry didn't do as well in March, the proof is Tesla's 232k and climbing...Tesla undoubtedly took away many of the traditional automanufacture's lunch this month and will continue to for the months to follow. They have been doing this the last two years in the luxury sedan market with the S. However, the M3 is a whole different animal.

I checked the sales number in March (Auto Makers Post Mixed U.S. Sales in March)

March’s selling pace came in at a disappointing adjusted annual rate of 16.57 million light vehicles, well below analyst expectations and the 17.5 million clip the industry reported in February.

So March was about 1.38 m sales, expectation was 1.46 m. Missed by 78 k. We got about 135k reservations before April's Fool for the Model 3. Given the lines are longer in the US, more than half of the 135k should be US. Not far away from the missing 78 k. Interesting...

 

[Car4CivilizedAge]

The last automobile which sold like this -- with no advertising, and selling faster than they could make them, for years on end -- was the Ford Model T.

From Wikipedia:

"The Model T set 1908 as the historic year that the automobile became popular for the mass market. The Model T was a complete success among the population; in a matter of days after the release, 15,000 orders were placed"

 

[stef]

Part 2 reveal is left for sometime in 2017 I think.

Should we add also the opening of the Model X design studio to the general crowd? If the ramp is really going well, this could be a further catalyst...

 

[Lessmog]

Near term catalysts:

Reservation updates
Q1 deliveries
Analyst upgrades and comments
Model 3 Reveal Event "Part 2"

Also, don't forget opening of the GF, soon! Maybe some tidbits about Tesla Energy will seep out there? That could qualify as a near term catalyst, I think.

I agree that "Part 2" is probably not this year, at least not soon.

 

[Hogfighter]

I have 2 high school daughters, and they said that everyone at their school was talking about the 3. My oldest was genuinely sad when she heard how many reservations there were, as it meant several years before she could put down a deposit.

So think about the younger generation. They are so tech-savvy, and want the 'new thing'. They aren't turned off by EVs, as in their minds 'EVs' equates to 'Teslas'......a positive connotation, not a negative one. They don't have the Love Affair with ICE cars that us older people do. We rebuilt engines, got greasy and filled with pride when the '68 Camaro cranked up after the rebuild. All they see with ICE cars is that they cost a ton to fix, and that paying for gas is the same as throwing the money away. In my day, customizing a car meant shaving the heads to increase the compression ratio. Nowadays it's installing a bobblehead on the dash.

The younger generation is where the throngs of reservations are coming from, and will buy Model 3 in the millions.

 

[cheshire cat]

Larken---thanks for a massive dose of common sense

 

[Drax7]

A win should feel like a win. This stock is going a lot higher.
Just my opinion.

 

[NOLA_Mike]

This is incredible - with Model 3 reservations nearing 250,000 and no indications of slowing down yet, Tesla could be considered to be, in effect, crowd funding their future capex expansion. Who ever heard of or imagined such a thing on this scale?

General Motors and Chrysler may be the auto companies the government won't let fail but Tesla is the auto maker the people don't want to fail.

 

[All Your Bases]

About the phase out of the federal incentive.

To me it looks like a pending political disaster. At some point in time you will see "American job's under-cut with the help of American Tax-payer dollars", when imports will still receive full incentive and Tesla/GM not.

It is difficult for me to imagine that this policy will remain unaltered ...