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Tesla Model S Demand in China is Huge

Discussion in 'TSLA Investor Discussions' started by sleepyhead, Oct 13, 2013.

  1. sleepyhead

    sleepyhead Active Member

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    #1 sleepyhead, Oct 13, 2013
    Last edited: Oct 14, 2013
    According to my research the demand for the Model S in China is huge, and now I received confirmation from a Tesla store employee. Tesla to ship 15,000 cars to China next year and there is a waiting list already?

    You can find my entire article here:

    http://www.investnaire.com/?q=groups/tesla-investment-and-trading/tesla-model-s-demand-china-huge

    Remember that Tesla just started accepting reservations for the Model S in China less than three months ago.

    Update:

    Sorry guys, looks like the article has been taken down. I apologize for this inconvenience and nobody is more upset about this situation than I am. One of the reasons I started writing on my own is so that I have complete control over the content. I will have to think about my next steps, but I might have to start my own blog so that this does not happen again.

    DaveT covered the gist of the article. I would just add that I talked to a low level Tesla employee who said that demand in China is huge and that there is a waiting list for the Model S. I can tell that the employee was genuine in what he said, but the source of his information is unknown and it could have easily come from customers (although I highly doubt this, since his knowledge about the company was so extensive).

    That said, I am confident that demand in China is indeed "huge". I have spent countless hours researching this topic and the company as a whole, the employee only confirmed by research. Unfortunately, I do not have the time to compile my research to present it to you guys, since I have a full-time job, family, kids, and have to manage several investment portfolios. My research consists of reading Chinese websites, reading opinion polls, Chinese Government programs, talking to my Chinese friends, looking at other auto companies strategies and success in China, etc. It would be impossible to compile all of this data into one concise article in a timely manner. But if you spend hundreds of hours researching this data, like I have, then the answer is pretty clear.

    I stand by everything I wrote and I know that demand in China is in fact huge. ​

    I will try to find another way to post this article to share with everyone.
     
  2. Cattledog

    Cattledog Active Member

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    Thanks Sleepy - I have had similar conversations when visiting Tesla Galleries over the last 18 months. They have confirmed my conviction in the company and the stock price appreciation. No real intrinsic reasons to sell as the fundamental story continues to improve. I hope the San Jose Mercury, a and few blogs to boot, quote your article!
     
  3. tlo

    tlo Member

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    Wow. I'd be surprised if they can deliver 15,000 cars to China next year. But if it's true, that's very good news.
     
  4. sleepyhead

    sleepyhead Active Member

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    Sounds unlikely today, but if the demand in China is as big as I expect and Tesla is able to produce 50K units next year, then they will have to ship at least 15K to China to spread the wealth evenly over the whole world.

    US 20K
    EU 15K
    China and Asia 15K

    Remember that Elon said it is really cheap to ship cars to China because all of the shipping containers are returning to China empty anyway, after they export their goods to the US.
     
  5. tlo

    tlo Member

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    Not sure if this is old news - I see that China is now available as a region on the Tesla website, redirecting to Tesla Motors | Premium Electric Vehicles. The site is not localized yet. They are taking 250,000 RMB for both S and X reservations.
     
  6. Convert2013

    Convert2013 Member

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    OK I go to a lot of parties here in OC/LA and have noticed the Tesla buzz is finally taking off now that just about everyone has seen one on the road. True organic growth has taken off! Q3 will be great, Q4 will be blowout, and next year as a whole will be HUGE due to larger numbers at home, Europe and China. China will shatter all expectations. People in that country have large amounts of $$ .. they are buying up Coastal California in CASH! They will have and S & and X in their garage and an E after that to park in the middle ,, haha
     
  7. DaveT

    DaveT Searcher of green pastures

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    First off, thanks for writing the article and sharing the link.

    If Tesla does 700/week in October, 750/week in November, and 800/week in December and we calculate 12 weeks of production in Q4, then that would be 9,000 cars produced in Q4. Wow.

    800/week (x 48 production weeks per year) is a 38,400 cars annual run rate. If they can end 2013 with those numbers, that will be truly incredible.

    They would need to ramp from 800/week cars at beginning of the year to at least 1200/week at the end of the year to reach those numbers.

    I think demand will be there. And I think if they can sort out their supplier constraints, then they can likely produce that many cars. We'll see.

    It's going to be interesting what Tesla guides for FY 2014. I'd guess 35000-40000 cars for 2014, and then whatever number they give they'll try to beat it substantially.

    This would be amazing. 15,000 cars not just to Asia, but just to China. I'd love to hear Elon/Tesla's take on this and how they've been able to test the demand for Model S in China.

    Overall, this is a truly amazing conversation sleepyhead had. I'd love to hear anybody else's story on any conversations with Tesla store employees and what you've gleaned.
     
  8. sleepyhead

    sleepyhead Active Member

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    Sorry guys, looks like the article has been taken down. I apologize for this inconvenience and nobody is more upset about this situation than I am. One of the reasons I started writing on my own is so that I have complete control over the content. I will have to think about my next steps, but I might have to start my own blog so that this does not happen again.

    DaveT covered the gist of the article. I would just add that I talked to a low level Tesla employee who said that demand in China is huge and that there is a waiting list for the Model S. I can tell that the employee was genuine in what he said, but the source of his information is unknown and it could have easily come from customers (although I highly doubt this, since his knowledge about the company was so extensive).

    That said, I am confident that demand in China is indeed "huge". I have spent countless hours researching this topic and the company as a whole, the employee only confirmed by research. Unfortunately, I do not have the time to compile my research to present it to you guys, since I have a full-time job, family, kids, and have to manage several investment portfolios. My research consists of reading Chinese websites, reading opinion polls, Chinese Government programs, talking to my Chinese friends, looking at other auto companies strategies and success in China, etc. It would be impossible to compile all of this data into one concise article in a timely manner. But if you spend hundreds of hours researching this data, like I have, then the answer is pretty clear.

    I stand by everything I wrote and I know that demand in China is in fact huge.
     
  9. mrdoubleb

    mrdoubleb Active Member

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    At the risk of sounding like a fanboy, I think your word is good enough for us. Not that i wouldn't like to read the details of your research, but if you say you did all that work, no one on these pages is going to question that.

    I was thrilled to read your post as Asia, and especially China seemed like a dark horse to me. I read the reports from Hong Kong which seemed like a good omen for Mainland China. I also read the rumors of Tesla talking to Chinese battery suppliers, and know how their cities are drowning in smog and that the government has really started to push EVs with legistlation. On top of that, China is 1.3 billion people or more, meaning the upper class may also be 100 million or more - and we know how well of those prvilegded people are. Their culture also seems to suggest (from what i understand) that prestige is very important to them, so owning the most talked about premium car on the planet, advertising how green they are, should be a good incentive. BMWs are just so... common. LOL.

    With Tesla's flagship store about to open in China, sales projections over there may just be the best up & coming news from Elon this year...
     
  10. Robert.Boston

    Robert.Boston Model S VIN P01536

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    @sleepyhead: you're very welcome to use the Blog capability here at TMC.
     
  11. ItsNotAboutTheMoney

    ItsNotAboutTheMoney Active Member

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    #11 ItsNotAboutTheMoney, Oct 14, 2013
    Last edited: Oct 14, 2013
    I'd also add that Mr Musk has more than once stated that the Model S will be modified for the Chinese market, in particular having noted that that wealthy Chinese are driven rather than drive.

    The implication is clear to me: Model S Limo. The additional implication of this would be a globally-available model more suited for use as a taxi. Tesla would be very wise to consider the economics of taxis and view it as a future market target.

    At this point, it is now also abundantly clear why VW and BMW are electrifying.
     
  12. kevin99

    kevin99 Banned

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    #12 kevin99, Oct 14, 2013
    Last edited by a moderator: Oct 15, 2013
    sleepy, in fact, being a Chinese-American, I am probably more familiar with the Chinese market and I do believe China holds the pleasant surprise for the main street.

    The issue however is the uncertainty of the time frame, and the magnitude of number, and how low it can go before this projection fully materializes. If one just buy and hold, then we know in half year TSLA is almost certain to head higher. But if options is in play, then the requirement is much more stringent to have a profitable trade. If there is prolong phase of side way movement, or even a severe pull back, then the OTM call option all goes down to the toilet. Now the investor has to face the difficult decision of bailing out or staying put.

    The other issue is when you are very certain about something, your tone make other audiences guilty of not following you, in the event you turn out to be right. This is risky as one can be right many times and inevitably wrong in some other calls. sleepy you've proven yourself with your insight and many, including me look to you for investment advice, so it is not my intention to debate whether certain projection is correct or wrong.


    That is my thought of reading the article and your other posts. Perhaps others have different reaction so it is an open discussion.

    As an example, in my signature, even though I am certain of my KNDI investment, I qualify my investment thesis as 'Speculative play', which ought to give a warning to those who are interested.
     
  13. Chickenlittle

    Chickenlittle Active Member

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    #13 Chickenlittle, Oct 14, 2013
    Last edited by a moderator: Oct 15, 2013
    I agree you have a better claim to the Chinese market. can I have Israel?
     
  14. Convert2013

    Convert2013 Member

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    I think I can understand both Sleepy's and Kevin's points of views. If the Merc S Class has 54% of its world market in China that says the potential of the Model S there, especially looking at the recent stats in California. How quickly wealthy Chinese accept and adopt another all new luxury brand is the question. Asians love established, respected foreign brands, no matter what country we are talking about in Asia (with the exception of Japan... they prefer their own cars and German cars, so far.. :) ). And often (not always) Asians like to have a driver for the high-end cars they own. My guess is by the time the Chinese spec Model S is ready the Chinese media would have picked up on the exponentially increasing sales and status of Tesla in the US and Europe and the Chinese will start buying them in droves to remain ahead of the curve. When will that happen? We are all hoping 2014 in this highly connected and small world.
     
  15. Robert.Boston

    Robert.Boston Model S VIN P01536

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    Moderator's note:

    Let's end the discussion about Kevin's editorial decision. I would move posts, but there's too much content woven into the debate to do so without gutting the thread.

    Let's keep the discussion going about Tesla in China, which is a very important topic for the future of TSLA.
     
  16. aznt1217

    aznt1217 Active Member

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    To get back on point. Model S demand in China had BETTER be huge. It's in the best interest of the country. There's a huge pollution problem in China and the fastest way to cut down is Solarpower and Car emissions because manufacturing wouldn't be something the government will cut down on.

    Beijing should be incentivizing people to buy a Model S with all the smog that it deals with.
     
  17. kevin99

    kevin99 Banned

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    Not to mix in my own agenda on KNDI, the direct beneficiary of "huge pollution problem in China" will not be TSLA. Tesla will have a great show and mind-blowing numbers in China, but that is because the model S is simply the best car, the rare combination of ingenuity
    , aesthetic, power, innovation and prestige, the exact formula to get the affluent Chinese to crave.

    As I "Speculate", KNDI had another great day back to $8. I hope to write an follow-up article updating my current rebuilt positions.

     
  18. Norse

    Norse Active Member

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    Im pretty sure they will benefit alot. The taxes for GEN3 could make a big difference. The model S I agree they will sell alot regarless of what the price is. But the extremly growing middleclass in China will make us in Norway fight for our soon-beloved Model E.
    I hope that Tesla will create a factory in China to make this possible.
     
  19. PeterJA

    PeterJA Member

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    China has over one million millionaires with a taste for Western luxury and high technology.
    China surpasses one million millionaires | Financial Post

    If half of them want the best and safest and highest-tech car in the world (which is also zero emissions and low cost for fuel and maintenance), then they alone could sustain a demand of 100k cars per year (if they buy a new car every 5 years) or more (if they buy more often).

    Tesla's Beijing store (opening later this year) will be three times larger than any Tesla store in the US or Europe. I doubt that's a coincidence.
    Tesla Motors Going to China, Gamble or Sure Bet? - The Green Optimistic
     
  20. Discoducky

    Discoducky Active Member

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    Can people in China see and contribute to TMC?
    If so, could someone get the word out to those who have reserved to post on TMC please?
     

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