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

[Drezil]

Interesting what effects incentives can have:

Dealer Offers To Drive a Tesla Model 3 for FREE for Six Months

Imagine driving a Tesla Model 3 free, for six months. A freelance car dealer from the Rhineland made its customers an insane offer in the summer: They can drive a Tesla Model 3 for free for six months and then give it back. Now he starts the action again. However, there are a few conditions to...

www.torquenews.com

The other manufacturers let their dealers buy those cars (looking at you VW ), let them sit on their lot for 6 months, grab the 6k incentive and then move them to another country (Denmark, France are popular) to sell them as "new, but pre-registered". Possibly taking advantage of subsidies there again.

VW did that with A LOT of id.3s in Dec 2020 to avoid penalties for CO2 emissions.
This also works for hybrids (albeit only 5k) and genetally only for cars below 40k€ in the "base version" without taxes.

Tesla just doesn't have dealers, but many Germans are currently driving their Tesla's for 6 months and then selling them cheap outside of Germany.
Basically getting 1k/month of subsidies for the privilege of driving a Tesla

And yes. These incentives are broken. But it is the best the government could do to help the German car makers without getting into trouble with eu-regulators ..

 

[OrthoSurg]

+4.4%
The numbers we all dreamed off for 1 month

Have a great day everybody

 

[MikeAtkinson]

I think its more likely that this "revenue per vehicle" amnt for FSD represents Pierre's assumption of just a 10%-20% take-rate for FSD (w/o further price increases).

Pierre is massively wrong. As long as Tesla remains production constrained, buyers will have to COMPETE for a new Tesla (same way you can 'cut to the front of the line' right now by ordering special paint or high margin wheels).

By the time Model 1/Robotaxi is ready for production (2028?), it will ONLY be possible to buy one with FSD (since there won't be a steering wheel). I estimate target annual production volume for Model 1 to be 10M units/yr. With an FSD price of $35K (and the cost of the hdw being ~$15K), that's a $50K ASP with a gross margin of ~70% on 10 Million units.

That's $350 billion gross profit per year, JUST on Model 1 / Robotaxi. At Pierre's 40x multiple, just that one single product line would add $14 TRILLION dollars to TSLA's Market Cap.

And it only gets better if Tesla operated the robotaxi's themselves (which Pierre poo-poo's), or when Tesla sells FSD as a monthly subscription instead of an outright purchase. Then, Commercial licences for fleets of course will be higher... And did I mention that a Model 1 / Robotaxi purchase may require Tesla Insurance? Yeah, more than $14T just from Robotaxi.

TL;dr Pierre isn't just sandbagging FSD, he's building a vacation home on Sable Island.

Cheers!

Pierre seems to be assuming a subscription model, $100-200/month for 30m vehicles (about 30%) of the Tesla fleet. If that were the case I would expect the multiple to be higher, especially as he has growth at 50%. A $500/month subscription (might seem high, but many people are paying that in fuel, service and depreciation now on ICE cars) and a 150x multiple (which is more in line with software growing at 50%/year) would have a valuation of 27 trillion.

A model with robo-taxi income would be higher still.

 

[CorneliusXX]

LG Energy Solutions (a cell supplier to the GigaShanghai factory) is IPOing in Korea. Future disclosures might be helpful in gauging Tesla cell availability. First trading is 27/01 Korea time.

EV battery maker LG Energy Solution's IPO breaks record.

LG Energy sets new IPO record with $9.65 trillion investor demand

Some relevant quotes:

Analysts said the valuation may be underrated as LG Energy controls 20.5% of the global electric vehicle battery market, trailing China’s CATL with 31.8%. The market leader’s corporate value is estimated at over $196 billion.

On Monday, LG Energy Chief Executive Kwon Young-soo vowed to overtake the Chinese company in the near future, saying that LG has an order backlog worth 260 trillion won, larger than that of CATL, and that he expects revenue growth of more than 25% over the next three years.

 

[H Mak]

The other manufacturers let their dealers buy those cars (looking at you VW ), let them sit on their lot for 6 months, grab the 6k incentive and then move them to another country (Denmark, France are popular) to sell them as "new, but pre-registered". Possibly taking advantage of subsidies there again.

VW did that with A LOT of id.3s in Dec 2020 to avoid penalties for CO2 emissions.
This also works for hybrids (albeit only 5k) and genetally only for cars below 40k€ in the "base version" without taxes.

Tesla just doesn't have dealers, but many Germans are currently driving their Tesla's for 6 months and then selling them cheap outside of Germany.
Basically getting 1k/month of subsidies for the privilege of driving a Tesla

And yes. These incentives are broken. But it is the best the government could do to help the German car makers without getting into trouble with eu-regulators ..

VW bending the rules? Nah

 

[MikeAtkinson]

Pierre's whole spreadsheet shows the perils of guessing what will happen in 2030. I prefer a different approach - look 2 years out and assume Tesla will grow at 50%/year or more for 10 years. This has only two assumptions:

1. Tesla will execute for the next couple of years according to plans we already know about in reasonable detail

2. After that Tesla will find ways of growing at 50%/year

Looking ahead two years Q4 2023 EPS should be over $10/share (annualised to $40/share), long term 50% growth should give a multiple of 150x or more. So end 2023 share price should be in the range of 6000. Discount that back to today and the share price should be in the range 4,000 to 5,000.

Looking at variations of this "model". If Tesla reach quarterly EPS of $10/share in 2023 Q3 or 2024 Q1 it would hardly make much difference, discounting back a few months more or less only makes a tiny difference to share price (less than the daily % range). So it is the second assumption that must be tested, can Tesla grow at 50% a year for 10 years or so.

Reaching 20 m vehicles in 2030 requires 46% growth in unit sales over 8 years (lower ASP is ofset by lower manufacturing cost, leaving profit per vehicle almost constant), if energy is a similar size to auto, then that gives another 2 years of 50% growth. Any growth from FSD, robo-taxi, bots, insurrance, AI, etc. is just icing on the cake.

 

[Cape Coddess]

Premarket looking juicy. Happy earnings day everyone. Fingers crossed.

Ooooo...could be lunch money day for me.
( sp @ $1,000)

 

[OrthoSurg]

Here's a snapshot of early trading action in Berlin (TLO) taken just moments before the pre-Market opens on NASDAQ in NYC:

Note: €837.40 eur is about U$945.25 (@10:00am C.E.T.)

View attachment 760363

Meanwhile, U.S. Tech macros were strongly GREEN just before the pre-Market opened in New York City:

Nasdaq 100 Mar 22 (NQ=F)​

CME** Delayed Price. Currency in USD​

14,307.25 +166.50 (+1.18%)​

As of 03:58AM EST. Market open.​

EDIT: Data is flowing now from NASDAQ in NYC:

TSLA Pre-Market Quotes​

This page refreshes every 30 seconds.
Data last updated Jan 26, 2022 04:15 AM ET.

Consolidated Last Sale (delayed 15 min)	$939.98 +21.58 (+2.35%)
Pre-Market Volume	43,036
Pre-Market High	$945.00 (04:14:32 AM)
Pre-Market Low	$936.20 (04:00:10 AM)

Cheers!

P.S. **CME is the Chicago Mercantile Exchange, which hosts futures trading (and many Options, too)

This is exactly the macro set up we needed the day of earnings.

Now buckle up, we are ready to lift off.

 

[H Mak]

Regarding a valuation of $10T by 2030, there are many ways you can get to it. I demonstrated it myself a few weeks ago on this forum. You just need a spreadsheet, some formulas, some assumptions and away you go. Every assumption you make is up for debate, number of cars, ASP, operating margin, which product lines to include etc etc., and the big one - assumed PE ratio. All up for debate. You just have to mess around with the numbers till you get to $10T.

Every single model can be challenged, questioned and criticised.

But here's the thing. $10T as a ballpark figure is credible. It seems crazy right now with the market value around $1bn but there is a genuinely believable route to $10T by 2030. No one is saying it will definitely happen, no one can, but it is most definitely a possibility. And with every year of execution, it edges towards being a probability. It's why I've got the vast majority of my life savings invested in Tesla.

 

[Mengy]

Interesting video about working at Tesla as a mechanical design engineer,

As an ME myself I absolutely LOVED this video!

Also Solidworks is the best 3D CAD software for engineering, I was pleased to hear Tesla uses it.

 

[juanmedina]

As an ME myself I absolutely LOVED this video!

Also Solidworks is the best 3D CAD software for engineering, I was pleased to hear Tesla uses it.

They use both SolidWorks and CATIA V5 from what I heard. I used SolidWorks for 15 years and we switched to Catia 3DX V6 and I hate it . SolidWorks FTW and is cheap and really efficient.

 

[MABMAB]

Everyone is all hyped about earnings, could be a disappointment. Don't trade based upon hype/emotions/hope today. Trade and invest upon discipline and planning, whatever that means for you. There are any number of things that could set folks off: 4680 issues, Germany slowing opening, labor market, chips or other things not being available, CT delay, China model delay or reveal and underwhelming, BTC impairments, supply costs eating into profits/reserves, China politics, etc...

Just stick to a disciplined plan and roll with the punches as they come, that is what I say.

 

[phantasms]

Did Powell TicTok himself peeing YOLO in the snow or something. How did my entire portfolio flip from very red after hours to very [not saying it] pre trading? This can’t all be because Microsoft said “cloud will grow” last night.

 

[Singuy]

Did Powell TicTok himself peeing YOLO in the snow or something. How did my entire portfolio flip from very red after hours to very [not saying it] pre trading? This can’t all be because Microsoft said “cloud will grow” last night.

Microsoft single handily crashed and then saved the qqq from their earnings.

 

[TheTalkingMule]

I think this covid spike's cases and hospitalizations having now clearly peaked in the US is an underappreciated macro factor. (let's not discuss this further here today)

MSFT up 4.4% in premarket after being down a similar amount AH is bullish. That's a +$200B valuation swing between two market sessions, entirely fueled by moderate 1Q22 and 2022 guidance. Craziness.

Happy Earnings Day to all!

 

[UncaNed]

I think its more likely that this "revenue per vehicle" amnt for FSD represents Pierre's assumption of just a 10%-20% take-rate for FSD (w/o further price increases).

Pierre is massively wrong. As long as Tesla remains production constrained, buyers will have to COMPETE for a new Tesla (same way you can 'cut to the front of the line' right now by ordering special paint or high margin wheels).

By the time Model 1/Robotaxi is ready for production (2028?), it will ONLY be possible to buy one with FSD (since there won't be a steering wheel). I estimate target annual production volume for Model 1 to be 10M units/yr. With an FSD price of $35K (and the cost of the hdw being ~$15K), that's a $50K ASP with a gross margin of ~70% on 10 Million units.

That's $350 billion gross profit per year, JUST on Model 1 / Robotaxi. At Pierre's 40x multiple, just that one single product line would add $14 TRILLION dollars to TSLA's Market Cap.

And it only gets better if Tesla operated the robotaxi's themselves (which Pierre poo-poo's), or when Tesla sells FSD as a monthly subscription instead of an outright purchase. Then, Commercial licences for fleets of course will be higher... And did I mention that a Model 1 / Robotaxi purchase may require Tesla Insurance? Yeah, more than $14T just from Robotaxi.

TL;dr Pierre isn't just sandbagging FSD, he's building a vacation home on Sable Island.

Cheers!

IMHO, I'd love it if we put FSD non it's own thread at least for another 5 years-8 years when it's closer to being relevant...

Edit - OR if this forum offered us the option to ignore FSD posts...

 

[Prunesquallor]

Gordo gets pwned by Hertz.

https://twitter.com/x/status/1486299947498713089

 

[Unpilot]

Please, I beg you all, NO MORE GOJO.

 

[Singuy]

Gordo gets pwned by Hertz.

https://twitter.com/x/status/1486299947498713089

There was a tweet too but hertz deleted it.

Also Ross is a national treasure. His interview is hilarious as always.

 

[Bouboule]

IMHO, I'd love it if we put FSD non it's own thread at least for another 5 years-8 years when it's closer to being relevant.

FSD is extremely relevant today, especially for option traders. The market will start pricing in FSD when they start believing it can become a reality one day. This will happen much sooner than FSD actually working perfectly and being approved by regulators. It's very hard to know when and what will trigger this change in mindset, but this can happen anytime. It could take 5 years, but 5months is also very possible with all the new releases.