Short-Term TSLA Price Movements - 2016

[madodel]

Anyone know if other automakers count cars in transit, or just those physically delivered to dealers?

 

[sub]

Anyone know if other automakers count cars in transit, or just those physically delivered to dealers?

I would guess they do since they are sold as inventory to dealers and not to individual owners.

 

[lango]

Of course, the business model will change. That is the point of merging TE and SC. This does not imply any need to raise capital, however. But if there are some new investments to make, these will be judged on their own merits. We simply cannot know what new opportunities TE may wish to pursue.

That said, speculating is fun. I think there is a good chance that TESC would want to move solar and battery installation into new states and countries. SolarCity has already dipped its toes into Mexico, and TESC could really build on this. TE has already gone into Australia and South Africa and perhaps other countries I cannot recall right now. So bringing integrated solar-battery products and services may also be attractive to TESC. Wherever they may go, raising capital to enter new promising markets can be quite a good thing and rewarding to investors. So we can all debate these investments as Tesla brings them to light.

Of course, anyone who really does not see much value in TE or in incorporating solar manufacturing and installation with TE really should get out of Tesla now.

I'd also point out that SolarCity's business model has been changing over the last three quarters. They appear to be backing away from lease and PPA financing, offering loans from financing partners instead. Moreover, they have moved toward 100% monetization of the total installation cost. That is, they are moving to a cash positive business model. This transition has been part of what has disoriented investors and left the stock price vulnerable to attack. But I do believe they have been making steady progress toward righting the ship, as it were. In fact, it is possible that the timing of this acquisition is deliberately ahead of that full transformation to get SolarCity while undervalued.

This may frustrating to some SolarCity shareholder who would like to hold out for a better price, but I do think that the full potential of SolarCity will be better realized in combination with Tesla Energy than on its own. So I am not personally disappointed by this timing or the exchange rate. If TESC is able to address a richer and deeper international market this will better tap the potential of SolarCity.

One other speculation, especially since SolarCity seems to be backing away from PPAs and leases, Tesla could issue preferred stock with a dividend tied to the cash flow from these PPAs and leases, the PowerCo book. A PowerCo preferred stock offering could raise over $2B in capital. One of the problems with SolarCity's business model was that it attracted growth investors with its growth, while the market wanted to value it on its PowerCo book which were longterm cashflows. The PowerCo book is not inherently a growth asset. It is much better suited for income investors, but SolarCity as a growth stock was in no condition to offer dividends so as to attract income investors. So offering preferred stock could be an ideal way to attract income investors with a substantial and reliable dividend stream. Meanwhile Tesla can take the capital raised from preferred stock and move into growth opportunities, like building a second Gigafactory.

So contrary to the idea that this merger would necessitate capital raises, the PowerCo book as an asset could be monetized for capital.

I think it will require further capital to fund the optimal growth rate and S and X will not be enough for this. I am very positive to the merger but a combined company is very hard to calculate and predict the investments needed and the detailed business model too to some degree. How many people actually can do that currently? I am back in the mode of just trusting that Elon will know how to use resources to grow the panel and storage business in a close to optimal way. Residential panels combined with storage sold in a "green" retail store is basically a new product and a new market, as oppose to cars which has been around a long time.

Tesla I think was much easier to understand if one did the research. I ignored SCTY based on the residential vs utility thing. I am much more positive towards residential with a merged company with stationary storage and retail stores. I think that is a great combination which changes things. Even if utility scale solar is more effective there will still be loads of people that just want to accelerate renewables and be more independent. A combined company will also focus on very efficient manufacturing (hell bent on becoming the best in manufacturing comment). They will of course also do utility scale solar panels and storage too but I am not sure they have such an advantage there on panels but they might be able to have an edge in storage both with cost, technology and integration. SCTY has proved there is a market for residential solar and they had great growth, but somewhat costly with the sales costs. At-least this is my understanding.

One potentially huge thing that I think has a high chance of happening is if Tesla can sell stationary storage PowerPack with a reasonably high margin to "early adopters" at the industry or utility scale. That in combination with 2400 a week S and X production and dropped battery costs should mean there are some money to invest for growth. But no matter what the optimal growth rate I think is faster than what that they can finance on their own so further dilution is expected.

It will be interesting to follow this anyway. Personally the merger and how TE develop (sales, margins and to whom they sell it) is for me as interesting as the cars at this point but I know less about it.

 

[motobaleno]

Anyone know if other automakers count cars in transit, or just those physically delivered to dealers?

no other counts car in transit. they count only car already road registered (actually this could hide some different bjas since a car can be registered but not already sold as a small amount of them actually are). I would like also tesla to disclose these data monthly as others do

 

[DrJohnM]

https://www.inverse.com/article/18257-tesla-changes-mission-from-transport-to-energy

Tesla Changes Mission From 'Transport' to 'Energy'

Elon Musk is thinking up part 2 of the Tesla master plan, and a subtle change in the “About” section of Tesla’s website hints at what’s next: a focus shift from “sustainable transport” to “sustainable energy.”

The one-word shift, noticed by Bloomberg, represents an entire company shift. The future that Musk envisioned and laid out in his first master plan in 2006 (build an affordable electric car) will be complete with the Model 3.

Just one word — “energy” — means that part two will likely be much, much more grand.

 

[Matias]

SolarCity's -- Many of those star salesmen must be taking in 7 figure commissions each year.

Really?

 

[madodel]

no other counts car in transit. they count only car already road registered (actually this could hide some different bjas since a car can be registered but not already sold as a small amount of them actually are). I would like also tesla to disclose these data monthly as others do

According to this Fortune article they do. An insider’s guide to auto sales reporting And they count any car delivered to a dealer as sold as well. So apparently all those monthly auto sales numbers are fake unless this article is wrong.

 

[30seconds]

Just a great read ahead of SMP2

http://solarquarter.com/index.php/analysis/996-solar-energy-the-road-ahead

 

[Papafox]

Ryan McCaffrey, in his Ride the Lightning: Tesla Motors Unofficial Podcast brought up an important point this week about Master Plan Part 2. For the past week, the media has been locked in a news cycle about Tesla autopilot issues. McCaffrey suggests that releasing the Master Plan Part 2 will change the news focus of Tesla to something much more positive. Makes sense, and the timing of Master Plan Part 2 is likely no coincidence.

 

[flankspeed8]

According to this Fortune article they do. An insider’s guide to auto sales reporting And they count any car delivered to a dealer as sold as well. So apparently all those monthly auto sales numbers are fake unless this article is wrong.

From what I can tell by following Volt sales, I do not believe they count until sold to an end consumer. If they were recorded as sold when they were shipped, the two months when the line was shut down waiting for the Gen 2 would have recorded zero sales. Likewise, once they starting shipping Gen 2 you would have seen more than a couple thousand units for sales if they were also counting dealer inventory. Just my observation from following Volt sales pretty closely.

edit: Not to mention the Cadillac ELR has long completed production and all copies have been shipped to dealers yet it still notches up a couple of sales a month from left over dealer stock. At least these two examples do not indicate that they are recorded as a sale for reporting purpose by just being shipped to a dealer, they have to actually be sold to an end consumer.

 

[MitchJi]

I've got some speculation about Tesla battery cells. The planned 100D MS-MX will, at least for a while (contract with Panasonic) use the 18650 format cells. The larger cells produced at the GF will include "not small, not large, but moderate improvement" due to chemistry.

So I think the GF produced cells will have an about 11% increase due to the cell chemistry plus the 7.5 percent increase in pack capacity due to the larger format.

That means(if it's correct) that the MS-MX packs would have about a 19% larger capacity as compared to the MS-MX packs of the same size in length and width, which are the two important demensions.

It also means that the MS-MX packs would have a capacity of about 109 kWh if they merely use the GF produced cells.

Also the number of cells has a huge impact on the pack costs. So think this increases the odds of a version of the M3 with a 300 mile range.

 

[RobStark]

From what I can tell by following Volt sales, I do not believe they count until sold to an end consumer.

The OEM accountants count a car sold when they collect the money from their customer, the dealer. That is before the car is en route to the dealer. This is used in financial reporting in dollars.

OEMs also keep track of dealer inventory, wanting to keep 60-100 days of inventory depending on the OEM and particular car line. When business operations people issue a press release of cars sold, this is when money changes hand from the retail customer to the dealer and a bill of sale is issued regardless of whether the car is registered. Although the dealer almost always registers the vehicle concurrently with the sale.

 

[flankspeed8]

The OEM accountants count a car sold when they collect the money from their customer, the dealer. That is before the car is en route to the dealer. This is used in financial reporting in dollars.

OEMs also keep track of dealer inventory, wanting to keep 60-100 days of inventory depending on the OEM and particular car line. When business operations people issue a press release of cars sold, this is when money changes hand from the retail customer to the dealer and a bill of sale is issued regardless of whether the car is registered. Although the dealer almost always registers the vehicle concurrently with the sale.

But how do we account for the fact that the ELR ended production in February, but according to insideevs.com sales tracker, the ELR recorded 94 sales in June. They take this from the EOM sales release by the OEM. The only explanation would be that GM stockpiled ELR's somewhere and are still shipping to dealers despite production ending months ago which I am not sure is the case. Not trying to start an argument, just saying that IMO, the empirical evidence suggests otherwise in some cases.

edit: maybe insideevs.com uses a different data set to report deliveries? But I always thought it actually reflected models moved off the lot into consumers hands that REPORTING MONTH.

And if this was the case there would be no rationale to the end of months sales push as that car would have already been paid for by the dealer and not benefit the OEM's sales as it would have already been reported.

 

[Mr_OW]

Just speculating: could the change in Teslas mission be as simple as changing one word in the current mission statement?

Current:
"Accelerate the advent of sustainable transport"

Possible:
"Accelerate the advent of sustainable energy"

In the last decade Tesla didn't focus on creating parts that could enable other automobile manufacturers to create EVs, they created EVs themselves. Could this transition to sustainable energy also involve Tesla going in at utility level and create their own powerplants based on solar / battery storage. I understand that this is sort of what SolarCity is doing, but the model is not perfect as grid access is important for most customers, and they still has som part of unsustainable element in their power usage (at least those that get grid power from an unsustainable source). If Tesla enters at utility level they can balance this out at a much greater scale. If you look at the GF plans they also include windpower and not only solar, and at a utility level wind and solar can also add balance to energy reliability.

 

[Bet TSLA]

@elonmusk
Have to focus on tonight's @SpaceX launch. Will post Tesla (master) product plan afterwards.

 

[Gerardf]

3 new tweets. From Elon.

Two about ap, one about smp-2

"Have to focus on tonight's @SpaceX launch. Will post Tesla (master) product plan afterwards."

Twitter

Next SpaceX launch is just about 8 hours away.

 

[Papafox]

"Please direct all criticism at Tesla." You gotta love Elon's willingness to find a real solution and not pass the buck.

So here he is, conversing with the radar manufacturer and with MobilEye while working out a solution for safer autopilot functioning on Hardware 1.0 vehicles, writing up Master Plan #2, and preparing for a SpaceX launch to the ISS later this evening. How many other CEOs are getting this much done on a Sunday?

 

[MitchJi]

Promising call today with @BoschGlobal, maker of our radar sensor. Looks like significant improvements possible via OTA software update.

Btw, want to thank both Bosch and MobilEye for their help and support in making Autopilot better. Please direct all criticism at Tesla.

 

[schonelucht]

I've got some speculation about Tesla battery cells.

Are you able to share your source?

 

[mrdoubleb]

So here he is, conversing with the radar manufacturer and with MobilEye while working out a solution for safer autopilot functioning on Hardware 1.0 vehicles, writing up Master Plan #2, and preparing for a SpaceX launch to the ISS later this evening. How many other CEOs are getting this much done on a Sunday?

He also directed attention to the Guardian article that hit a reasonable tone on the AP criticism. People chimed in, that, while the article is great, the comments section is full of idiots. (What's new...) To which he replied we need more smart people commenting [articles like that], to which people started tweeting stuff like "we got your back Elon".
How many other CEOs get this reaction on any day of the week?