Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Nocturnal]

Your remark is based on the assumption that future Tesla customers (fishing in the ICE market) behave the same as previous ones (EV enthusiasts).

I strongly disagree:

1. Most ICE owners won't switch to EV without a test drive. Period. Not offering classic test drives is an incredibly stupid idea and affects more potential buyers than you may think.
   
   
2. The 1000mi / 7 days test offering is seen as a farce by most people – at least in Europe. Do you have any idea how much work it is to sort out all the required paperwork (state, insurance, etc.) to receive a number plate? Beside the fact that this can take up to a week and cost $250-300?! Who the hell is willing to do that for a car they probably won't even keep?
   
   
3. People should test drive the top-of-the-line cars as an incentive to upgrade.

Couldn't care less for people paying 3% more for a $40k+ car, I'm sorry.

I go back and forth on #1. #2 isn't a problem in the US. We get our tags well after purchase. It isn't a replacement for a test drive, but rather a "oh crap, what if I hate it" insurance plan.

 

[Fobble]

One thing that I have not seen enough discussion is Tesla's competitor in China: NIO. Stock price has been devastating the last few trading days (dropped from 10.5 to ~6.7) due to company's change of direction of NOT building their own assembly factory. Is it a pure coincidence with Tesla's announcement of the SR $35k M3?

 

[KarenRei]

But can we assume the average shipment to be more than 2k ?

I believe @KarenRei wrote 30k Q1 deliveries outside of North America as a lower and thus fairly certain bound.

~1,6k is the lowest shipment we heard a number for (the first one, which you'd expect to be low). The highest we ever heard was 4k (although it wasn't explicitly stated that all were going on the same ship). I think 3k is the highest confirmed shipment we've seen. I think 2,5k per ship is probably a reasonable estimate. Which would be 40k to China + Europe.

30k is an estimate of deliveries, based on how it looks like the delivery rates are going at present. But there's a lot of potential variance in that number.

 

[bdy0627]

How on Earth are we up today? All this uncertainty and weirdness should have us testing $270. Someone must have been quite supportive over the last week.

Huge model Y reveal Thursday will cause substantial buying pressure through market close Thursday.

 

[UncaNed]

Huge model Y reveal Thursday will cause substantial buying pressure through market close Thursday.

AND model Y will eventually be something else for stores and galleries to display.

Also... if model Y is 10% bigger than model 3, How does the size of model Y compare to the size of model X?

 

[Fact Checking]

One thing that I have not seen enough discussion is Tesla's competitor in China: NIO. Stock price has been devastating the last few trading days (dropped from 10.5 to ~6.7) due to company's change of direction of NOT building their own assembly factory. Is it a pure coincidence with Tesla's announcement of the SR $35k M3?

What kind of battery cells did NIO plan to use in their Shanghai factory, before the plans were abandoned? Was the cell supplier known?

Maybe CATL has some freshly freed up capacity now?

 

[KarenRei]

AND model Y will eventually be something else for stores and galleries to display.

Also... if model Y is 10% bigger than model 3, How does the size of model Y compare to the size of model X?

"10% bigger" is too ambiguous to be able to respond to that.

• 10% bigger on one axis?
• 10% bigger on two axes?
• 10% bigger on all three axes?
• 10% more internal volume?
• 10% heavier?

Without knowing that, we can't even come close to making a comparison.

All I'm hoping is that there's a three-row option. Not only would that significantly expand the market, but it'd also make an easy putdown to all of the other manufacturers that try to pretend that their CUVs are big. "What, you're comparing your little 5-seater to a 7-seater? LOL..."

 

[Pezpunk]

AND model Y will eventually be something else for stores and galleries to display.

Also... if model Y is 10% bigger than model 3, How does the size of model Y compare to the size of model X?

I expect the main difference between the X and Y is the X is slightly bigger, but much fancier. Elon has described it as "the faberge egg of cars".

 

[T-Will]

Do we think TSLA will react similarly to the Model 3 reveal for the Model Y reveal?

 

[humbaba]

I go back and forth on #1.

What, more writing on the wall?

#2 isn't a problem in the US. We ... crap.

I'm starting to think that there's something wrong with me and these disassociated associations.

/me checks to see if I've removed the wristband and changed out of the gown.

 

[jbcarioca]

I was thinking of the classic tax free acquisition.

Tax-Free Acquisitions

Perhaps surprisingly, this can be used even if you don't technically sell stock in your company, but rather "substantially all" the assets of your company (I've seen it done repeatedly. The link goes into some detail on the rules). Note, it doesn't have to be literally all the assets, just "substantially" all -- over 80% is good enough.

This one looks like a "C" reorganization to me. Might be a forward triangular merger though.

Yes, I can attest that such transfers are frequently tax-motivated. FWIW, the shares in question can be restricted in various ways, need not actually be publicly traded, and still qualify. Of course one needs qualified tax and legal advice, both of which I had when I did that.

 

[TradingInvest]

One thing that I have not seen enough discussion is Tesla's competitor in China: NIO. Stock price has been devastating the last few trading days (dropped from 10.5 to ~6.7) due to company's change of direction of NOT building their own assembly factory. Is it a pure coincidence with Tesla's announcement of the SR $35k M3?

I can't predict NIO's stock price.

From business point of view, it will be very difficult to compete against Tesla, no matter it's a legacy car company or a startup EV company. If I were running a startup EV company, I would have no clue how to compete against Tesla's Model 3 and Model Y from Shanghai Gigafactory.

Elon said there maybe a cheaper Tesla EV coming in 3~4 years. Tesla could sell cars at cost still make a healthy profit from software.

If another car company wants to survive, they would have to figure out FSD first, which is not easy.

 

[EVNow]

Hard to know what has driven this updated strategy; it could be positive or negative reasons. It could be just that Elon was willing to take on feedback from staff, investors & customers and is not too stubborn to change his mind. Maybe demand mix for the non base car was higher than expected so they think it makes sense to raise prices. Maybe demand bump from the lower prices was lower than expected so they decided to maintain the extra sales channel and extra margin per car. Maybe exiting leases was harder than anticipated. Maybe it was just an excuse for a temporary price reduction to shift Q1 inventory. Maybe the added cost from keeping an extra 20% of stores open with less staff is lower than the new 3% price increase and this will be positive for operating margin.

Whatever the reason ...
- Shows EM is open to changing decisions and quickly, if there are good reasons. Other CEOs would have taken years to reverse decisions.
- Might have been an elaborate experiment to see what happens if you drop the price i.e. will the sales go up enough to make up for the lower margin. Unlike software companies Tesla can't do an easy A/B experiment - they have to resort to such elaborate methods.
- My guess would be the sales increase was less than expected

Either way, Tesla now knows what happens if they drop prices by 6%. That is valuable information.

 

[Artful Dodger]

Hi folks.

Question: Now that Tesla is acquiring Transport companies, how long until they buy their first ship? Cheaper / faster than GF4/Benelux?

Inquiring minds want to speculate.

Cheers?

 

[printf42]

1. The 1000mi / 7 days test offering is seen as a farce by most people – at least in Europe. Do you have any idea how much work it is to sort out all the required paperwork (state, insurance, etc.) to receive a number plate? Beside the fact that this can take up to a week and cost $250-300?! Who the hell is willing to do that for a car they probably won't even keep?

Can you elaborate on that? Do you have to do a lot of paper work before you take delivery? Or are you required to finish all paperwork in a certain time frame after?

In US it’s minimal amount of paperwork as long as you have the fund. If you take a loan from outside of Tesla, there would be some email back and forth to get the check ready before delivery, other than that, all paperwork is just some signatures on delivery day.

If you have insurance already, most policy allow you to retroactively add a new car a few days later, so you could do that only after you decide to keep the car.(It might be different if you take a loan though, but it’s just a phone call anyway.)

Could you elaborate on what the paperwork would be like in EU, if you decide not to keep the car.

 

[RobStark]

“agree that it is still painful and sucks, and I guess most retail employees who are not comfortable with a showroom role are now actively looking for Service Center positions or another employer”.

This.....not ideal if your customer facing employees are unhappy or rapidly turning over.

From a customer POV I think this is almost all positive. The pushy salespeople that make really good money are leaving. Leaving you to browse without someone over your shoulder.

This leaves mostly inexperienced young people that can't easily get a better paying job but believe in the mission as store employees.

The only negative I can see is some customers who are not accosted by salespeople believing no one is trying to sell them a car for discriminatory reasons.

 

[elasalle]

.

Hi folks.

Question: Now that Tesla is aquiring Transport companies, how long until they buy their first ship? Cheaper / faster than GF4/Benelux?

Inquiring minds want to speculate.

Cheers?

Local GFs before ships....

 

[humbaba]

Hi folks.

Question: Now that Tesla is aquiring Transport companies, how long until they buy their first ship? Cheaper / faster than GF4/Benelux?

Inquiring minds want to speculate.

Cheers?

i would expect that to not be in the cards for some time. Too expensive and far removed from their domain to contemplate.

With trucking, that fits in with electrified semi. They have nothing for electrifying ships.

Fun to contemplate though

 

[RyanT]

1. Most ICE owners won't switch to EV without a test drive. Period. Not offering ordinary test drives is an incredibly stupid idea and affects more potential buyers than you may think.

Very much agree with this. Even buying my 3rd EV and second Tesla I did a test drive. My friends all did the same. I like doing a test drive on performance vs AWD before I make my decision. I hope they change this policy.

I guess they were thinking they would have less inventory car sales if they don't do test drives? It can't just be for the reduced sales staff can it?

 

[KarenRei]

Very much agree with this. Even buying my 3rd EV and second Tesla I did a test drive. My friends all did the same. I like doing a test drive on performance vs AWD before I make my decision. I hope they change this policy.

I guess they were thinking they would have less inventory car sales if they don't do test drives? It can't just be fore the reduced sales staff can it?

Reduced staff, reduced inventory, reduced insurance, etc etc.

Regardless: No need to rehash what's been rehashed here tons of times. There are lots of ways to structure allowing people to test a vehicle without it being an undue hassle to them, and for the time being, with the price reduction, it's pretty irrelevant regardless until the "easy sells who were just waiting for a good price" have gotten their cars.