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

[lklundin]

OT



I can personally attest to this too, with the added aspect that Fred proceeded to shadowban me for pointing out the correction.

I believe Karen can personally attest to something similar.

Luckily, archive.org typically manages to take snapshots also of electrek.co. In that case every change is abundantly clear and cannot be hidden by Fred.

 

[Fact Checking]

In an informal discussion with a Tesla employee about a year ago, she told me employees had the option of buying the stock at different intervals for the lowest price it had been at in the previous 90 days. I did not ask for any more details...

This sounds like a standard ESPP (Employee Stock Purchase Plan) benefit, and it's usually a good deal, limited to a small (<10%) percentage of your salary.

 

[Fact Checking]

The most recent shipment for EU departed Pier 80 on March 3, and is expected to arrive in EU in about 23 days, leaving five days to clear customs and probably get at least some delivered.

Do we know whether there are Model 3's piling up anywhere in Europe due to logistics problems? I.e. after they get unloaded from the ships at Zeebrugge, what is the typical delay to get them to owners? Are delivery centers or owner scheduling the bottleneck?

 

[Fact Checking]

We can disagree as to whether competent PR specialists could influence (not "manage") the few remaining neutral reporters trying to maintain objectivity and/or assist those sympathetic to Elon's mission.

Fair enough, and I think they are trying, as Tesla still has some "journalistic access" currency they can pay in: factory visits, interviews with Elon, event invitations, ER invitations, exclusives, etc.

But note that two recent attempts resulted in harm: both the NYT and the 60 Minutes interviews resulted in ambushes and hit pieces, which Elon is not handling well. (He's just too honest to start lying and stonewalling with a stone face like every other CEO does.)

I'm not too worried, because this too shall pass: the German media has already come a long way, surprisingly it's the U.S. media that is the most hostile to Tesla and Elon.

Anyway, IMO the only open question is the timing, as usual.

 

[Carl Raymond]

That is actually a part of my investment thesis, that there is such a divide between the bear and the bulls (in the media and elsewhere), that one has to be wrong. (I'm betting that the bears are wrong...)

Good call. One of those camps doesn’t know power from energy, clueless on science. And yet the success of EVs is fundamentally a science question. Musk runs rings around every other CEO on science, and he put his last dime into Tesla. He’s three steps ahead. The past week’s supercharger developments a great example. Others think they are making headway, then kapow, knocked to oblivion by an OTA they didn’t see coming.

 

[schonelucht]

Do we know whether there are Model 3's piling up anywhere in Europe due to logistics problems? I.e. after they get unloaded from the ships at Zeebrugge, what is the typical delay to get them to owners? Are delivery centers or owner scheduling the bottleneck?

The only thing that is consistent is that what delivery specialists are telling customers in the benelux, is totally inconsistent. We've had reports on the relevant thread about people calling that delivery specialists are not allowed to say on which boat their car is, with the next message being a cheerfull "I just called and they told me my car is on boat such and such". Norway seems to have its *sugar* together but the Benelux is a mess. We're now a full month into it and it's still the same. At this point, I can only assume it's due to sheer incompetence from local management. Either because they are incompetent themselves or because they are not giving the means to do a competent job by Tesla USA.

All that to say that we have a report of a customer that their car is in Zeebruge for a while now but they can't get it shipped to Tilburg. But who knows if that is actually true...

 

[RobStark]

No Deal Brexit tariffs revealed as UK confirms car prices would rocket by £1,500

In case of a No-Deal Brexit the UK would impose a tariff of 10.6% on cars.

That means a price increase of .6% for Model 3 in the UK.

Model S and X get shipped directly to UK from CA and prices increase ~5%, save on reassembly in Tilburg .

And European car prices increase 10.6%.

Makes Jaguar Land Rover ICEv and Nissan LEAF more competitive vs Tesla.
Jaguar I Pace made in Austria, but maybe this would cause repatriation?

But Tesla relative advantage vs European made cars make it a net win for Tesla in UK market IMO.

 

[schonelucht]

Jaguar I Pace made in Austria, but maybe this would cause repatriation?

In which factory? Small UK volumes for the i pace make repatriation a non-starter in my opinion.

There is also a possibility that UK consumers will drastically reduce large purchases due to uncertainty and in the hope that later bilateral agreements would make the tariffs lower again. Most likely, Tesla will end up being a winner in terms of market share but a loser in terms of absolute sales volume.

 

[Fact Checking]

Did everybody see this (thanks @Papafox )?

Recent Tesla (TSLA) Noise is 'Just Noise', Selling Every Car They Can Produce - Wolfe Research

This is also consistent with Ross Gerber's recent tweets after his factory tour. Seems there is a huge gulf between media reports and insider views of Fremont. Both sides can't be right. We'll find out soon enough!

BTW., here's some full(er) quotes from the Wolfe report, with new facts highlighted:

'Wolfe Research analyst Rod Lache reiterated an Outperform rating and $430.00 price target on Tesla (NASDAQ: TSLA) saying they are incrementally convinced that the recent noise is '"just noise" after hosting Tesla IR Martin Viecha for two large group meetings in NYC.'

'Lache said while event Tesla bulls have been shaken by the sheer volume of recent noise in the system, "it was good to look management in the eye and hear that Tesla is selling every car they can produce."'

'Over the short term, the analyst said the lower pricing has stimulated US demand and Europe / China deliveries are brisk. Over the long-term, he said demand sustainability "isn’t an issue" given Tesla's many advantages have led to vehicles now priced below comparable ICE competition and $20k+ below EV competition.'
​

another source:

'production "smooth"'​

The 'smooth' wording to characterize production was probably from the Wolfe Research report.

Pretty reassuring and in line with the following data: Carsonight battery pack numbers and Alpha Hat January deliveries estimate.

VIN registrations are still an outlier, and of course a proper end of quarter delivery push in Europe might or might not work out as @schonelucht cautions. Every 1,000 Model 3's narrowly not shipped will reduce revenue by ~$60m and cash flow by ~$15m. 10,000 cars not shipped will hurt: -$600m and -$150m, plus various one time expenses.

 

[RobStark]

In which factory? Small UK volumes for the i pace make repatriation a non-starter in my opinion.

There is also a possibility that UK consumers will drastically reduce large purchases due to uncertainty and in the hope that later bilateral agreements would make the tariffs lower again. Most likely, Tesla will end up being a winner in terms of market share but a loser in terms of absolute sales volume.

Solihull.

Presumably, Jaguar Land Rover UK made cars will lose sales in Europe with a 10% tariff freeing up space in Solihull.

And with a price advantage in the UK vs German electric CUVs presumably Jaguar will sell more I Pace in the UK.

 

[Carl Raymond]

BTW., here's some full(er) quotes from the Wolfe report, with new facts highlighted:

'Wolfe Research analyst Rod Lache reiterated an Outperform rating and $430.00 price target on Tesla (NASDAQ: TSLA) saying they are incrementally convinced that the recent noise is '"just noise" after hosting Tesla IR Martin Viecha for two large group meetings in NYC.'

'Lache said while event Tesla bulls have been shaken by the sheer volume of recent noise in the system, "it was good to look management in the eye and hear that Tesla is selling every car they can produce."'

'Over the short term, the analyst said the lower pricing has stimulated US demand and Europe / China deliveries are brisk. Over the long-term, he said demand sustainability "isn’t an issue" given Tesla's many advantages have led to vehicles now priced below comparable ICE competition and $20k+ below EV competition.'
​

another source:

'production "smooth"'​

The 'smooth' wording to characterize production was probably from the Wolfe Research report.

Pretty reassuring and in line with the following data: Carsonight battery pack numbers and Alpha Hat January deliveries estimate.

VIN registrations are still an outlier, and of course a proper end of quarter delivery push in Europe might or might not work out as @schonelucht cautions. Every 1,000 Model 3's narrowly not shipped will reduce revenue by ~$60m and cash flow by ~$15m. 10,000 cars not shipped will hurt: -$600m and -$150m, plus various one time expenses.

Not bolded was “vehicles now priced below comparable ICE competition”.

This simplifies the analysis to...
Before you are an Accord, a Camry and a Model 3. Pick one to keep and drive home.

Yes, it’s more nuanced to measure how far out of the ballpark, but this is the test to know that the ball has cleared the back fence.

 

[EVMeister]

No Deal Brexit tariffs revealed as UK confirms car prices would rocket by £1,500

In case of a No-Deal Brexit the UK would impose a tariff of 10.6% on cars.

That means a price increase of .6% for Model 3 in the UK.

Model S and X get shipped directly to UK from CA and prices increase ~5%, save on reassembly in Tilburg .

And European car prices increase 10.6%.

Makes Jaguar Land Rover ICEv and Nissan LEAF more competitive vs Tesla.
Jaguar I Pace made in Austria, but maybe this would cause repatriation?

But Tesla relative advantage vs European made cars make it a net win for Tesla in UK market IMO.

Under that scenario a £30-40K Model 3 would have a few hundred quid added to the price in the end, then? Even for higher-end Model 3s, I don't think it really makes them less attractive than a poverty-spec £64K Jaguar I-PACE. It's really the ridiculous lease deals that shift those I-PACEs to hard done by Brits like myself. But compared to the e-tron, yeah I can see the relative win for Jaguar there.

 

[bhzmark]

It doesn't take long to do your homework. Looking up the rules on who could be stockholders in private companies... you know, it took me ten minutes. Musk didn't bother to do this before tweeting. This is dumb.

While I'm sympathetic to this point, especially in hindsight, it occurs to me that we should all be grateful that Musk didn't look up the rules on how to propel and sell cars and instead threw out the rule book.

If it doesn't violate the laws of physics, then it is possible -- lets give it a shot. This is how he operates and so far has yielded some great innovations disrupting many traditional rule books on how things are done with only some bumps in the road.

 

[shlokavica22]

BTW., here's some full(er) quotes from the Wolfe report, with new facts highlighted:

'Wolfe Research analyst Rod Lache reiterated an Outperform rating and $430.00 price target on Tesla (NASDAQ: TSLA) saying they are incrementally convinced that the recent noise is '"just noise" after hosting Tesla IR Martin Viecha for two large group meetings in NYC.'

'Lache said while event Tesla bulls have been shaken by the sheer volume of recent noise in the system, "it was good to look management in the eye and hear that Tesla is selling every car they can produce."'

'Over the short term, the analyst said the lower pricing has stimulated US demand and Europe / China deliveries are brisk. Over the long-term, he said demand sustainability "isn’t an issue" given Tesla's many advantages have led to vehicles now priced below comparable ICE competition and $20k+ below EV competition.'
​

another source:

'production "smooth"'​

The 'smooth' wording to characterize production was probably from the Wolfe Research report.

Pretty reassuring and in line with the following data: Carsonight battery pack numbers and Alpha Hat January deliveries estimate.

VIN registrations are still an outlier, and of course a proper end of quarter delivery push in Europe might or might not work out as @schonelucht cautions. Every 1,000 Model 3's narrowly not shipped will reduce revenue by ~$60m and cash flow by ~$15m. 10,000 cars not shipped will hurt: -$600m and -$150m, plus various one time expenses.

Actually the highlight for me is this: Over the long-term, he said demand sustainability "isn’t an issue" given Tesla's many advantages have led to vehicles now priced below comparable ICE competition and $20k+ below EV competition.

We know the demand is there and we know Tesla sells all they can make. What's interesting to see, in the next couple of quarters, is the impact on the ICE vehicles demand. The double blow for them is the cheaper Model 3 spreading with increased speed + the imminent Model Y reveal. That's the real story here. The bigger the avalanche gets- the stronger the momentum.

 

[schonelucht]

Solihull.

Presumably, Jaguar Land Rover UK made cars will lose sales in Europe with a 10% tariff freeing up space in Solihull.

And with a price advantage in the UK vs German electric CUVs presumably Jaguar will sell more I Pace in the UK.

I just don't think the volumes are there to justify the investment in having two separate manufacturing sites. Plus there has got to be some penalties associated with not meeting certain volume at Magna Steyer.

 

[Fact Checking]

Not bolded was “vehicles now priced below comparable ICE competition”.

Yeah, I only highlighted new facts/impressions Wolfe Research reported from their meeting with Tesla IR Martin Viecha.

The fact that $35k and ~$38k entry prices are in a good place when compared to ICE competitors was already known.

 

[Fact Checking]

There is also a possibility that UK consumers will drastically reduce large purchases due to uncertainty and in the hope that later bilateral agreements would make the tariffs lower again. Most likely, Tesla will end up being a winner in terms of market share but a loser in terms of absolute sales volume.

Note that the UK government's tariff plan is similar to their BRexit negotiation plans: it's a fantasy that will never materialize.

The "cars will be £1,500 more expensive!" are obvious scare tactics to whip MPs into voting against a no-deal BRexit today and tomorrow. It's also a nice campaign slogan for MPs who do vote against a no-deal BRexit: "Look I avoided a £1,500 tax on new cars!".

It has no relation to actual tariff plans. Should the UK crash out of the EU on March 29 by accident, I fully expect the UK government to drop all tariffs to make sure the UK economy exits the predictable free fall it will get into. The UK doesn't even have the proper border infrastructure yet, so they'd try to fast-path imports and exports as much as they can.

 

[CorneliusXX]

OK, guys, let's be clear on this: all guidance since last July or so has been that Q1 will be more or less breakeven on a GAAP basis. Does it really *matter* whether it's slightly above the line or slightly below it ? Either way free cash flow should be positive.

Agreed. I think production could be the bigger driver of the share price over the next couple of months. If production holds at around 85% of vin registrations then it is likely to surprise the market given the current pessimistic outlook shared by analysts over the last month.

 

[CorneliusXX]

OT


OT -- I love some of the old customs case citations.

"62 Cases, More or Less, Each Containing Six Jars of Jam v. United States, 340 U.S. 593 (1951)"

I don't quite understand why the tradition in customs cases is to sue in the name of the PRODUCT, which isn't done in most contexts.

Or the one referring to Playboy inc.

 

[Tslynk67]

I understand people paying extra for a Founders Series car, but I wonder who would buy a Founders Series Semi and why.

Maybe the operating costs accrued from the earlier delivery time are are most than the extra cost.