Short-Term TSLA Price Movements - 2016

[30seconds]

The company still has a lot of levers to pull over the next few months (if they want to)

* update on Model 3
* show the Model Y and accept deposits (hopefully w/o falcon wing doors)
* Autopilot 2.0 feature roll-out and more demonstrations
* Powerwall 2.0 deposits and orders
* New Buffalo deal with Panasonic
* 5 seat Model X
* Modulate GF1 spend

I think this goes to show that the Telsa of November 2016 is a substantially larger business with more growth opportunities than the one 18 months ago.

 

[electracity]

Well next Q we'll see how much real demand the powerwall has since Tesla is taking actual deposits online. No idea if this is global. If it is, we might see powerwall deposits equivalent to car deposits from Australia alone. P.S. at which point Tesla wouldn't need to raise much capital.

It is clever, but deposits alone may not move SP. Deliveries will move SP. Presumably both the new cell line and the new powerwall 2 line need to be working well to deliver volume to customers.

It's arguable that the M3 hasn't boosted SP because of Tesla's poor execution delivering the MX. Tesla made an enormous splash with the powerwall 1, but did not scale to actually fill the orders. This may create some skepticism of when powerwall 2 will be delivered in volume.

I think it is entirely rational at this point in time for analysts to expect Tesla to deliver new product before raising TSLA targets. Proof that the gigafactory is delivering giga-ish product volume to customers should help a lot. Plus recycle significant capex.

 

[larmor]

The company still has a lot of levers to pull over the next few months (if they want to)

* update on Model 3
* show the Model Y and accept deposits (hopefully w/o falcon wing doors)
* Autopilot 2.0 feature roll-out and more demonstrations
* Powerwall 2.0 deposits and orders
* New Buffalo deal with Panasonic
* 5 seat Model X
* Modulate GF1 spend

I think this goes to show that the Telsa of November 2016 is a substantially larger business with more growth opportunities than the one 18 months ago.

While its nice that the street wants more info and 'security' on execution of M3- high volume lower margin product, right now, short term, there is a compelling demand for larger battery in the highest GM product offered. In fact, really what should be asked, is why or when will 100kwh battery be available for new MS and all MX, and what is the upgrade pathway for existing cars.


An upgrade pathway means your average used MS becomes a 300+ mile EV.

 

[Skryll]

Around 100% of SolarCity customers willl buy a Tesla Powerwall. That's 300,000 units from existing customers.

A $6,000 Powerwall only costs ~$2,000-$3,000, depending on where you live, after the ITC.

A comparable gas generator costs $10,000-$25,000, excluding maintenance costs and the price for fuel, and is huge.

As of 2007, ~ 12 million gas generators were installed in the USA. That's 12 million people who are likely to consider buying a Powerwall.

Note the powerall has 13.5kWh capacity but outputs 7kW continous, so a comparable system would be http://gens.lccdn.com/generaccorpor...-generators-powerpact-7kw_spec-sheet-2017.pdf which does actually cost more like $2k, not $10k.

I also doubt even 50% of the solar city customers will add the powerwall, unless it is feasible for SolarCity to add that to their leasing customers to lower the amount of money going to the net-metering power company because of some time of use plan.

I think its a great product and tesla will have enough demand to match supply but not as overstated as you put it.

 

[electracity]

For the past Q we see Tesla has good operating leverage. Elon also talked about scaling through improving the efficiency of machine that makes the machine. If BMW can scale to 500k in one plant, there is no reason Tesla can't do more.

There is not the slightest evidence that Tesla is a better manufacturer than BMW. In fact, the anecdotal evidence of rework indicates the opposite.

Fortunately Tesla just needs to be a "good enough" car manufacturer to be very successful.

 

[Yonki]

I really wish Tesla would publish a "Common Misconceptions about Tesla (and SolarCity)" blog entry which captured and coherently & thoughtfully refuted every bear/bullsugar/Lutztard argument against TSLA and SCTY. The FUD machine is out of control; let's have one place we can point to for analysts, reporters, civilians, etc. to go that shows reality. Relying on Elon's tweets & philosophical answers to analysts' questions, reading tea leaves, a few good journalists and reality itself is not working...

 

[Value Ev]

Musk is determined to create pent up demand in all the new product categories. How this strategy plays out will probably be very different than apple.

IIRC correctly the Ford Mustang when new had tremendous demand. That might be a better analogy. I don't think beetle demand built over time.

When the Porsche designed Beetle first came out in Germany in the 30's it cost about the same as a motorcycle and had a 25 HP engine.
There was not a huge demand at first and it wasn't even mass produced until after the war.

A better analogy to pent up demand, besides the Mustang, is the Mazda Miata. There was a huge demand for that and people paid huge premiums to get one early on.

 

[150 kWh]

Note the powerall has 13.5kWh capacity but outputs 7kW continous, so a comparable system would be http://gens.lccdn.com/generaccorpor...-generators-powerpact-7kw_spec-sheet-2017.pdf which does actually cost more like $2k, not $10k.

I also doubt even 50% of the solar city customers will add the powerwall, unless it is feasible for SolarCity to add that to their leasing customers to lower the amount of money going to the net-metering power company because of some time of use plan.

I think its a great product and tesla will have enough demand to match supply but not as overstated as you put it.

Why would you compare a gas generator to a battery storage system?

 

[Value Ev]

Relying on Elon's tweets & philosophical answers to analysts' questions, reading tea leaves, a few good journalists and reality itself is not working...

But it is working, big time.
Tesla has a huge valuation vs. what they deliver on in terms of revenue and profit.
The market is giving Tesla a huge premium for their vision and the expectations for dramatic growth and changing the world and stopping CO2 growth and all that. And all of that also factors in all the FUD and possible execution risk that comes with it.

Tesla had every opportunity on Friday and Tuesday to provide more substantial and specific information, but they chose not to and so tea leaf reading continues.

 

[drinkerofkoolaid]

Note the powerall has 13.5kWh capacity but outputs 7kW continous, so a comparable system would be http://gens.lccdn.com/generaccorpor...-generators-powerpact-7kw_spec-sheet-2017.pdf which does actually cost more like $2k, not $10k.

I also doubt even 50% of the solar city customers will add the powerwall, unless it is feasible for SolarCity to add that to their leasing customers to lower the amount of money going to the net-metering power company because of some time of use plan.

I think its a great product and tesla will have enough demand to match supply but not as overstated as you put it.

Many things wrong with the comparison you mention.

1) Maintenence costs + fuel costs. Maintenence costs for a gas generator are extremely high. Also, as the article I posted emphasizes, because gas generators are idle most of the time, they don't always work. The Powerwall doesn't have this problem.

2) Size, design, and functionality of the devices.

3) Ability to work with the Grid.

4) Life and reliability of the two devices.

5) Your comment about net metering doesn't make sense. Peak vs. off peak rates make a big difference. Anyone who already has a SolarCity system would be crazy to not invest $2000 -$4,000 into a Powerwall. Sure some will want to finance it, or have it added to their monthly energy bill. However, I suspect the majority of people will want to own their Powerwall.

 

[Value Ev]

How about "50,000 per 6 months" or "100,000 annualized", those okay?

I'll just go with what Elon said, thanks.

 

[SuperDragon]

Stocks to high for me to buy more but to low for me to sell

I feel like ive been in limbo the last two weeks

 

[dalalsid]

Well next Q we'll see how much real demand the powerwall has since Tesla is taking actual deposits online. No idea if this is global. If it is, we might see powerwall deposits equivalent to car deposits from Australia alone.

It is clever, but deposits alone may not move SP. Deliveries will move SP. Presumably both the new cell line and the new powerwall 2 line need to be working well to deliver volume to customers.

It's arguable that the M3 hasn't boosted SP because of Tesla's poor execution delivering the MX. Tesla made an enormous splash with the powerwall 1, but did not scale to actually fill the orders. This may create some skepticism of when powerwall 2 will be delivered in volume.

I think it is entirely rational at this point in time for analysts to expect Tesla to deliver new product before raising TSLA targets. Proof that the gigafactory is delivering giga-ish product volume to customers should help a lot. Plus recycle significant capex.

Well if no money needs to be raised, Tesla doesn't need to care about SP. And neither do any long term investors.

 

[mmd]

I'm confused with the excuse given for negative margins for TE, and talks of higher margins with more volume. During Giga factory opening ceremony, people saw robots assembling TE products, and crates and crates of products ready to ship. Some members here counted hundreds of millions in revenues from the number of crates. How much more will it scale? It is already fully automated with robots. IMHO, the low margins are here to stay, because the TE assembly is already automated.

On a separate note, does anyone know the timeline of payments to Panasonic?
Tesla obliged to pay $1.7 billion to Panasonic for gigafactory cells

 

[Turing]

If you can cite a SCTY filing that explains that I'll concede the $0.9 billion is possibly realistic.

I'd also like to know what estimates were used to derive the $0.9 billion number. My point was more that the systems will still have a fair amount of value in most cases but scty/tesla will need to renegotiate the contract. In my experience most people choose the path of least resistance on these kind of things. So unless the roof needs to be replaced, they will leave it alone if solarcity offers them a deal that is reasonable enough.

 

[electracity]

Well if no money needs to be raised, Tesla doesn't need to care about SP. And neither do any long term investors.

Money needs to be raised to build factories in China and Europe. Gigamoney for gigafactories. In a perfect Muskonian reality these factories would be under construction today.

Tesla ain't bootstrapping the massive capital that demand suggests they need.

 

[Roger t]

There is not the slightest evidence that Tesla is a better manufacturer than BMW. In fact, the anecdotal evidence of rework indicates the opposite.

Fortunately Tesla just needs to be a "good enough" car manufacturer to be very successful.

My Model S is pretty much flawless so I am not sure about the doubt of Tesla as a manufacturer. Model X has issues because of the complexity of the doors. I am actually impressed that Tesla is making so many Model X now.

 

[koolkool]

Welp. My Jan 2017 options are screwed. The stock price is the exact opposite of where I thought it'd be after a full month of ground-breaking news. Wtf is going on?

 

[Skryll]

My Model S is pretty much flawless so I am not sure about the doubt of Tesla as a manufacturer. Model X has issues because of the complexity of the doors. I am actually impressed that Tesla is making so many Model X now.

I am not surprised. The FWD doors are a 'see across from parking lot' trademark advertisement, and the car is awesome to drive. Last weekend we took it through its first snow, AWD for the win. Every occasion becomes a nonprofit sales event, i.e. us at the school halloween event trunk or treating explaining the car and the vision to so many parents.

 

[electracity]

I'm confused with the excuse given for negative margins for TE, and talks of higher margins with more volume. During Giga factory opening ceremony, people saw robots assembling TE products, and crates and crates of products ready to ship. Some members here counted hundreds of millions in revenues from the number of crates. How much more will it scale? It is already fully automated with robots. IMHO, the low margins are here to stay, because the TE assembly is already automated.

On a separate note, does anyone know the timeline of payments to Panasonic?
Tesla obliged to pay $1.7 billion to Panasonic for gigafactory cells

IIRC no new processes were in production. Some of the old, more manual assembly operations had been moved to Nevada.

It starts with the new cells, which are presumably put into new subassemblies, which then make their way into the final products. Powerwall 2 and Model 3 are priced at gigafactory production costs, which AFAIK has not happened yet.

The source of the new powerpack cells in unclear to me.