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

[mrmage]

I've only ever had calls exercised when I chose to do so, all other time I just rolled the position - other than the very rare case of an early assignment, you need to be pretty careless to have your stock forcibly sold

And the ~$600k I've made so far this year in selling calls and puts rather validates the idea, I think

I always look at percentages. It's a lot if $600k is 30% of one's portfolio. But too much work if it's just 3% IMO. Or I could just be lazy

 

[Paracelsus]

Up to $8B in funding for not-so-clean Hydrogen in the Infrastructure Bill

Infrastructure bill includes up to $8 billion for "clean" tech worse than coal

"Blue Hydrogen" could result in 20 percent more emissions, study finds.

www.motherjones.com

 

[Curt Renz]

It’s Friday, which implies a weekly options expiration. A cursory options survey suggests that $720 may be the strike price toward which large option writers with the ability to manipulate the share price would want it to close today. Thin vacation month volume could make it easier for them.

 

[elasalle]

It's been a long long time since my broker called must be something good gonna happen

No calls when SP was going down.

 

[redan]

More good news out of Shanghai:

https://twitter.com/x/status/1426244841340506114

 

[The Accountant]

Interesting if analysis is true...another $600M unrecognized revenue...Paging @The Accountant ....thoughts?

https://twitter.com/x/status/1425972562140569601

This could be true but I believe that Tesla would reduce their warranty accrual in smaller amounts over time rather than one big adjustment.
Warranty expense as a % of Sales has been dropping each year except so far in 2021, the 2% of sales is flat to 2020.
Notice that there was no blip higher with a new factory (SGH) coming on board in 2020. So I expect to see the warranty expense as a percentage of sales continue to drop as Austin and Berlin come on line.

 

[MP3Mike]

This could be true but I believe that Tesla would reduce their warranty accrual in smaller amounts over time rather than one big adjustment.
Warranty expense as a % of Sales has been dropping each year except so far in 2021, the 2% of sales is flat to 2020.
Notice that there was no blip higher with a new factory (SGH) coming on board in 2020. So I expect to see the warranty expense as a percentage of sales continue to drop as Austin and Berlin come on line.

View attachment 696181

Isn't it more of matter of how much liability they release as cars go out of warranty? Currently the cars sold in 2017 are falling out warranty, as that happens any remaining liabilities should be released. And each year they sold more cars than the prior year, so each year more and more cars fall out of warranty. (Or does the money stay there forever until it is spent, and they just reduce how much is added with each new vehicle to try to "spend it down"?)

 

[lafrisbee]

The Bootlegger?

Rum Runner

 

[lafrisbee]

Just a thought...there might be a big increase in action at closing like yesterday... Yesterday's whale is gonna be bright enough to know that the MM's will be actively trying to achieve a certain price...we will see .

 

[Krugerrand]

Protecting the life support systems that provide us the air, water and food we need to survive isn’t about altruism or charity, it’s enlightened self-interest.

Like Elon says, if you find yourself digging your own grave, stop digging.

That’s a fair point, except when I invested it was more altruistic. There was a slim to none chance he could or would succeed. So, it was the ‘idea’ that I invested in and a really huge pile of Oreo cookie ‘hope’ it could be achieved.

 

[The Accountant]

Isn't it more of matter of how much liability they release as cars go out of warranty? Currently the cars sold in 2017 are falling out warranty, as that happens any remaining liabilities should be released. And each year they sold more cars than the prior year, so each year more and more cars fall out of warranty. (Or does the money stay there forever until it is spent, and they just reduce how much is added with each new vehicle to try to "spend it down"?)

Your comment is correct. When a vehicle is out of warranty it no longer has a warranty liability on the balance sheet.
Warranty calculations that I have seen or have audited at other companies are usually just a huge spreadsheet exercise. There is no warranty accrual assigned to each and every car and tracked.
Tesla likely takes claims experience and applies it to the age of their fleet.
They know for example that they spend on average:
$100 in month 1
$50 in month 2
$xx in month XX
$1 in month 48

Then they apply these rates against the remaining warranty months of their fleet.
Over time, the $100 in month 1 has become $95 and then $90, etc . . . thus allowing them to reduce the liability needed.

copying @jbcarioca who I believe has some experience with warranty programs.

 

[saniflash]

Just a thought...there might be a big increase in action at closing like yesterday... Yesterday's whale is gonna be bright enough to know that the MM's will be actively trying to achieve a certain price...we will see .

agreed. sure looks like every time the SP is pushed down today someone starts buying. definitely different from the prior Fridays when once the pushdown began no strong counter reaction could be observed

 

[Krugerrand]

Didn’t you think that was Elon nudging the future PM to help smooth things with federal and local officials? I thought the minister’s presence was effectively that to begin with. Surely he looks at Tesla as an unusual chance to spur development in the former East.

I’m sure you’re right. I’m simply not convinced that he convinced the ‘Germans’. Having personal experience, sometimes it’s easier rolling a boulder up a hill. With your tongue.

 

[Singuy]

Isn't it more of matter of how much liability they release as cars go out of warranty? Currently the cars sold in 2017 are falling out warranty, as that happens any remaining liabilities should be released. And each year they sold more cars than the prior year, so each year more and more cars fall out of warranty. (Or does the money stay there forever until it is spent, and they just reduce how much is added with each new vehicle to try to "spend it down"?)

I believe only the bumper to bumper warranty will end for 2017 cars, but the drivetrain warranty is much longer, I believe another 4 years on top.

 

[Krugerrand]

Elon working it in Germany:

https://twitter.com/x/status/1426176396657897481

That’s such a smart move. Wow!

 

[elasalle]

https://twitter.com/x/status/1426051255722405894

 

[Unpilot]

Doing my part for warranty expense. Just turned over 50,000 trouble free miles on my Model S.
So it is out of warranty now.

 

[Artful Dodger]

I’m sure you’re right. I’m simply not convinced that he convinced the ‘Germans’. Having personal experience, sometimes it’s easier rolling a boulder up a hill. With your tongue.

I guess we'll know by Halloween:

 

[Discoducky]

It’s Friday, which implies a weekly options expiration. A cursory options survey suggests that $720 may be the strike price toward which large option writers with the ability to manipulate the share price would want it to close today. Thin vacation month volume could make it easier for them.

What is maxpain for 8/20 going to be on Monday morning though? Should be higher than the current $690

 

[CHGolferJim]

What is maxpain for 8/20 going to be on Monday morning though? Should be higher than the current $690

Yes, but it must be rare to move $20 over the weekend. I generally wait to watch Monday AM's unwinding of Friday's shenanigans which doesn't get captured until Tuesday 7AM ET, as far as I know.