Can we get a hangouts going DaveT? I feel like we need one.
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SolarCity is just a stupid concept. Solar panels are continuing to come down in price so why would anyone agree to a 20 year contract to have power supplied from panels on your roof that you don't even own.
And I don't buy the argument that people don't want to worry about maintenance. My vacuum cleaner requires more maintenance than solar panels.
Also it gets to a point that vertically integrating too many products will scare away customers. Someone walking in to buy a Tesla will be bombarded with complete end to end energy products and will start to get intimidated. And how do you sell this online? Every roof is different so you need salespeople (probably on commission) to come out and measure you up and do the hard sell.
It completely moves away from the original Tesla model.
And I don't buy the argument that people don't want to worry about maintenance. My vacuum cleaner requires more maintenance than solar panels.
Also it gets to a point that vertically integrating too many products will scare away customers. Someone walking in to buy a Tesla will be bombarded with complete end to end energy products and will start to get intimidated. And how do you sell this online? Every roof is different so you need salespeople (probably on commission) to come out and measure you up and do the hard sell.
It completely moves away from the original Tesla model.
Ulmo
Active Member
Didn't you and the person you responded to just see this happening? I saw it too. Whether it WILL happen or not I think is your question, though, for which I don't have any type of answer.
bonnie
I play a nice person on twitter.
From the Tesla blog:
- We would be able to expand our addressable market further than either company could do separately. Because of the shared ideals of the companies and our customers, those who are interested in buying Tesla vehicles or Powerwalls are naturally interested in going solar, and the reverse is true as well. When brought together by the high foot traffic that is drawn to Tesla’s stores, everyone should benefit.
To be fair - no one says they have to retain the current business model. I would imagine they'll pivot pretty heavily away from any failing concepts and go far more in on an integrated solution with Powerwall and an end-to-end transit/utility solution to appeals to EV buyers.
SCTY was always Elon's pet project that he never really got to pay attention to - and it languished. Now he can take it under control and whip into shape, integrate it with Tesla Energy and have a vertically integrated setup no one else can even come close to competing with in the current market.
If anything, the Tesla mission statement said this would happen.
hockeythug
Active Member
I like it long term but for the short term he needs to take a leave of absence from SpaceX until the Model 3 is shipping in very large numbers.
Drumheller
Active Member
My complaint is from a customer point of view. Tesla has great reviews online for it's cars. SolarCity has horrible reviews online for it's product and service. I was looking into getting solar earlier this year and eliminated SolarCity after reading the reviews.
tinm
2020 Model S LR+ Owner
When I read that in the Tesla blog, it occurred to me that this, in a way, sheds new light on the Q1 2016 shareholder's letter's statement of aggressive growth in Tesla stores later this year and next year, in anticipation of ramp-up of Model 3. Perhaps some/all of these new stores are a combo Solarcity/Tesla store? Are any existing SolarCity facilities retail-ready. or are they more like front offices to warehouses and regional operations in the back? Just curious if any future Tesla stores might suddenly pop up overnight within SolarCity facilities, upping the Tesla "store" count.
And I agree regarding possible end-runs around nasty auto-dealer-controlled state legislatures that currently ban Tesla... wouldn't that be something.
STARR X
Member
Although I don't like the sales price as my average SolarCity sales price is higher, I have thought for months this is what Tesla should do. With people now only getting .04 or .05 kWh for putting solar electricity back into the grid, it makes a perfect sense to store your excess electricity and thumb your nose at the power companies. This is a long-term move and SolarCity is cheap right now. I will vote for it.
TSLA should not be throwing away billions to correct the failings of the SolarCity business model.
If Elon wants solar panels, buy a solar panel production facility for $300 million with no baggage.
Causalien
Prime 8 ball Oracle
When we debate this, let''s have an agreementioned to disclose your holdings.
The price of this purchase is not an issue in my opinion. I do not like the dressing trying to cover this up. Using stock for purchase will not alleviate the most major issue at hand: Cash burn.
I vote no to the merger. For me to change my mind, I need to see the Riveses brother putting all the fortunes they have into the business.
Disclaimer Holder of TSLA shares.
The price of this purchase is not an issue in my opinion. I do not like the dressing trying to cover this up. Using stock for purchase will not alleviate the most major issue at hand: Cash burn.
I vote no to the merger. For me to change my mind, I need to see the Riveses brother putting all the fortunes they have into the business.
Disclaimer Holder of TSLA shares.
I'm wondering if part of the play was for the upstate NY-Buffalo Solar City gigafactory. While it's costing Tesla quite a bit in the near term, the tax incentives afforded and the jump in permitting/build time might have been worth it to them.
dc_h
Active Member
I really expected blowout delivery and production for Q2 and 250 in July. Even with blowout numbers I don't see ATH until next year, at best. Stock value could be diluted by more than 2.5bn if the stock is no longer valued on the promise of 30% gross margin auto and 30%++ gross margin for TE.
Unless they change the business model at Tesla Solar?, and move into utility scale installations this is going to hurt. It doesn't stop success of the mission, but it will impact stock valuation and hurt long term if they return to market for more money--which this makes more likely.
Looking forward to counter argument from DaveT and others.
Unless they change the business model at Tesla Solar?, and move into utility scale installations this is going to hurt. It doesn't stop success of the mission, but it will impact stock valuation and hurt long term if they return to market for more money--which this makes more likely.
Looking forward to counter argument from DaveT and others.
So, it would be a genius move if there are enough shareholders that are both short TSLA and short SCTY. As the margin calls come rolling in, these short sellers will have to cover their SCTY bets, but then, might also have to cover their TSLA positions to raise cash. Hence sparking a short squeeze on both stocks. Maybe? Maybe? Am I thinking about this wrong in my incoherent rage?
Ulmo
Active Member
100% agree. I'm currently going on hundreds of hours sifting through four (4) solar providers for a home install right now, for over $50,000. I would only accept top-rated companies with great reviews. Solar City wasn't even on the long long long superlong list, its reviews were so bad. Also, I never did figure out anything to analyze its offerings with: their web site is opaque, and everything I've ever gotten from them is opaque. I've always seen Solar City as a business that fills in the gaps between the well-to-do and the really poor who simply can't affording anything but want to do right by the environment and their own health, and farm out the costs to others. That's a niche market, because that means there has to be a payback, and that requires solar panels to be cost-effective, which is always a wavering proposition. Also, it means Solar City is constantly going after the not-so-well-to-do, and there's not a lot of customer money floating around.
Having said all that, if TSLA can clean up SCTY's quality level (to the customers), then that is no longer a detraction point. Does TSLA have an inside road to even be able to do that? Why couldn't TSLA have cleaned up SCTY's act before making an offer to SCTY? Is this an aggressive hostile takeover, because the CEO of TSLA doesn't agree with the CEO of SCTY? I sort of feel like it's not. But it might be at some level. It could even be an "excuse" to take SCTY in a new direction, doing more fully-paid installations rather than being so heavily financed.
Also, they could finance solar installs with fully-paid cars, and repo the cars upon solar install defaults. If customers complain, the customers have option to sell the home and keep the car they couldn't afford. Not great customer service, but financially it at least napkins out in my head.
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RobStark
Well-Known Member
Absolutely. There almost always are.
Elon, with a not too shabby track record, thinks this path is a no brainer.
Totally agree
If Elon believes in SolarCity, he should turn it into a private owned company, not dragging everyone else from another public traded company into sink hole
SolarCity, more like SellParty
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