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

[mars_or_bust]

That doesn't align with the explanation given by Elon. Not at all. He clearly said that due to shortages they would be able to make the same number of vehicles whether they had the cheaper car or not.

In what world does it make sense to trade more profitable, more expensive products 1:1 for cheaper products with less profit?

The shortages in fact probably makes the, for Germany very shameful, Berlin delay less problematic than it is. Even if Berlin opened more than 6 months ago as initially planned, it would take a significantly longer time to reach capacity than envisaged, due to the lack of chips.

Otherwise I suspect Elon would have put a lot more public pressure on Germany to stop their corrupt delaying tactics.

One consequence could in fact be the rumored plant in Slovakia, as a hedge against future delays to the planned Berlin expansions - I still expect Berlin to open this quarter.

 

[SOULPEDL]

Disclosure time.
I had hoped that a blowout 4th quarter and full year numbers would blow the stock up. So I bought some 1/28 calls, which died a horrible death.

Then I thought well ok, but surely they can't be that stupid, so I bought some 2/4 calls which are now on life support.
My portfolio has dropped by multimillion paper dollars in the last several weeks.

My only regret is that I wish I had just bought more stock and stopped my YOLOing (I still blame the mule)

When I started investing in Tesla in 2017 I was so impressed by the product and the car and of course EM I put my entire 401K into the stock.
Yep, I went 100% in on Tesla.

After the recent fall in SP, my only regret is I don't have any dry powder to buy more.

This is the most transformational company I have ever seen and most likely will ever see.
If they just stuck with energy and EV's it would be still the most amazing company.

But because it is led by such a visionary leader Who you know ACTUALLY LEADS (#Marydidn'tlead) I now know this company will be bigger than even I thought possible.

General AI? Tesla BOT? FSD? I did not see any of that in 2017!

If I were EM I would not tweak the President or weigh in on COVID related issues.
But man when one man can get SO MUCH right the things I THINK are wrong ...there just footnotes.

Still 100% in and behind Tesla and EM.

Edit to say THIS is one more reason (as if we need any more) to support The transition from ICE.

Peru oil spill after Tonga eruption bigger than previously thought

The ecological disaster, linked to Tonga's tsunami, is said to be double the size first reported.

www.bbc.com

Thanks for sharing. Makes us realize this is truly complicated and not everyone wins the day but can still win despite the chaos and a few setbacks - all because we picked the right company.

I'm also still "all in" but realized my timing for this decision in Dec was terrible (went from 90% to 100% TSLA by picking up a few call options that are not-so-DITM-anymore). And as if salt on the wound, brother Bob keeps asking me "You have any dry powder at all?" Ya... sorry, no. That's my only regret today, passing up a good sale. But with nothing to buy, that's one less thing to worry about today. Live and learn

Congrats to all those who played this well!

 

[mongo]

So: "The (casting machine count) implies that Berlin phase 1 can reach 1M and Austin 1.75M (perhaps up to 2.5M)."

Let's just make sure that @Troy doesn't miss this information, and its implications, going forward.

Some quick maths, that's 1.0+1.75+1.2+0.6 = 4.5M minimum capacity with existing facilities fully ramped (perhaps up to 5.5M).

Can Tesla complete that within 2 to 3 years? Oh Yes, without doubt (you don't buy Gigapresses unless you plan to USE them!).

All WITHOUT new facilities. Thanks for the analysis. Very insightful.

#2024Production

As mentioned above, Berlin only uses rear castings at present. At the limit, 8 presses allows for 2 million cars per year (assuming body and stamping can keep up).
2x250k + 6/2*250k = 1.25 million if they switch to structural next and don't replace existing body lines.

 

[Maarten]

To better visualize these areas, here is the Exterior view of Giga Shanghai provided in the 2021 Q4 Investors Letter (Page 23), with my annotations in green:

If this is a recent picture of Giga Shanghai and when I see the amount of meters soil on the NE part, it confirms my thoughts that this is prestressing like described in post #291,032 .
This is going on for at least 3 months now, but like @c041v has pointed out later, there is no way of knowing how far Tesla is in the process of prestressing.
We will have to wait until we see trucks and dozers taking away/spreading out the meters of (probably) sand, after which we will see the actual building starting to take place there.
Taking into account that the building of a factory takes around a year, the earliest it will be in operation is Q1 2023.

 

[Paul_SF]

Congrats to all those who played this well!

Are you congratulating hedgies and shorty? (jk )

 

[Silent Ludicrosy]

Each pair of casting machines produces enough casts for 250,000 cars, even allowing for downtime. There are 8 casting machines planned for Berlin and there is room for at least 14, perhaps up to 20 in Austin. The clear implication is that Berlin phase 1 can reach 1M and Austin 1.75M (perhaps up to 2.5M).

There are at least two casting machines installed at Berlin and three installed at Austin (with another one being built). So casting machine capacity is 250,000 in each of Berlin and Austin (which will soon have its capacity raised to 500,000). New casting machines seem to be delivered every couple of months, so by the end of year capacity between the two plants will be 1.5M.

If Fremont and Shanghai between them can produce 1.5M this year, it does not seem too much of a stretch for Berlin and Austin to produce 0.5M.

Next year Tesla could have 1.5M from Shanghai, 1.5M from Austin, 0.5M from Fremont and 0.6M from Berlin.

For 2024 I expect over 4M between Shanghai and Austin, another 1.7M from Fremont and Berlin and another couple of factories ramping up.

For those who lose who like to track casting machines, Idra publishes how many casting machines it has sold on the website. Right now the number is 21, recently updated from 19. I assume Tesla has bought all of them and will for the foreseeable future. Idra Group

 

[ZachF]

Also, given that the constraint during 2022 and 2023 is likely to be chips, not batteries, and definitely not assembly lines ... ... once Austin is running on Y (and then 3) this creates the possibility of temporarily shutting lines in Fremont to retool them. In particular switching the 3 line to all-castings would in turn free-up some floor space by stripping out a lot of robot welding and stamping areas. Maybe even the opportunity to either build a new paintshop or rework the existing paintshop (though that implies a much bigger all-plant shutdown for the duration). There's a lot of work required to get another GA line into Fremont, and at some point that paint shop needs to be tackled, otherwise Fremont at 750k will not be reached.

One thing they could do is just have Austin manufacture the castings for Fremont. Supposedly there is room there for a large amount of Giga presses there.

Austin could also manufacture the 4680 pack and they could ship the “skateboard” to Fremont for final assembly. They could also ship some castings to Reno to be mated to packs manufactured there, which would then be sent to Fremont. CATL >Shanghai could supply LFP packs.

Giga presses at Fremont could then be converted to S&X and Kato would eventually supply S&X batteries unless it just continues to be an R&D plant. You could then free up large parts of the Fremont factory and increase capacity with it.

 

[M|S|M MYP]

S/X refresh- late
Cybertruck-late
Roadster 2-late
Semi-late
Plaid+ cancelled
Austin- late
Berlin- late
FSD- insanely late


Yeah...king of sandbagging


Elon delivers amazing products. Eventually. They are 1000% worth waiting for- and you will.

The fact we've had years of folks seeing them arrive late/delayed and people still tell this sandbagging narrative is nuts.

Elon repeatedly tells you things like "I try to be very literal, generally you don't need to read between the lines, just read the lines" and people keep ascribing these secret PLANS WITHIN HIDDEN PLANS to his words.

He told you CT isn't coming this year. There's no reason not to believe him.


Same problem with people who keep insisting the MODEL 2 IS COMING despite Elon explicitly saying there's no model 2, that's not a thing.

He's gonna be on time eventually

 

[jbcarioca]

With GM and Ford earnings next week...

Aren't the dealers better positioned to profit from the increased "margin" associated with the supply chain caused supply - demand dynamic? My thought is while the manufacturer struggles to get parts, they generally sell those vehicles to the dealerships at published wholesale pricing. It's then the dealerships that add huge market induced markups? Maybe the manufacturer is discounting less than usual to the dealers, but it seems like the stealerships are making the lions share of markups. So....the manufacturer is suffering from reduced efficiency from running their factories at reduced capacity/scale without much markup potential. Plus they are now throwing additional money investing in "getting in the EV game" also at very low rate production .... Seems like their earnings should be utterly dismal.

Here is the answer to your question:

NADA sees record profits for dealers

Dealership profitability could keep rising in 2022 as supply chain shortages continue to squeeze inventories.

www.autonews.com

 

[Singuy]

He's gonna be on time eventually

He's on time, actually exceeded expectations when it comes to unit sales and operating margins

In 2016 he said 500k unit in 2020, that was on time.
Then said 50% growth for 2021@ 750k units...blew that out of the water.

So when it comes to the P&L Elon is ahead

 

[MikeAtkinson]

As mentioned above, Berlin only uses rear castings at present. At the limit, 8 presses allows for 2 million cars per year (assuming body and stamping can keep up).
2x250k + 6/2*250k = 1.25 million if they switch to structural next and don't replace existing body lines.

I assume that rear castings only won't last long, it is just too advantageous to use dual castings with a structural battery pack.

Another data point is that long term they plan to ramp cell production up to 200-250 GWh per year, while the short term goal is 100 GWh. That is well over 1M cars. It looks like the cell factory will have trial production towards the end of the year, Austin is clearly taking priority in terms of production equipment at the moment.

 

[kabin]

There are a lot of companies that trade at stupid PEs. Disney is currently at 100

Yep, I recall it was over 150 a few months back but Disney's SP has also been taken to the woodshed as appropriate.

 

[jbcarioca]

Yeah, except your predictions are ALSO too low for Shanghai. Recall the Environmental Impact Statement Tesla filed in Nov 2021, they said their expansion project at Giga Shanghai would be complete in April 2022 (see Wu Wa's videos of "BMP-2" in the SW quadrant).

This is almost certainly to support a 4th GA line, the 2nd Model 2 line in the Phase 1 GA hall. This 4th GA line will result in an annualized production run-rate of 1.2M at Giga Shanghai sometime during calendar 2022. So that becomes their minimum production for 2023/4, and that's w/o other expansions.

The plain reason why @Troy Q1 2021 production estimates were so dramatically wrong (no, twitter updates in the last 2 days of the quarter AREN'T predictions, Troy) was because he failed to understand that there even WAS a 2nd Model Y line coming online in Shanghai during Q4.

Now, he's repeating his mistake with the 2nd Model 3 line, while ignoring the obvious building contruction ground preparation underway on the land parcel to the NE of Phase 1. They're not growing watermelons there, no matter what unrelated quotes you want to pull from the conference call. I expect over 2.2M from Giga Shanghai alone in 2024 (about a million more than your estimate above)

Troy, what IS obvious is that Tesla will pace new facility contruction as they require. They are NOT constrainded by capital, and semi-conductor constraints will be over by then. 2nd GA lines can easily (and will be) added at both Austin and Berlin, and the 2024 time frame derisks any permit delay concerns. Adding modules of new production is far easier than 1st builds.

TL;dr Troy is mainly wrong, but I sure his Patreon's will continue to lap up his grist.

Very well said. You might even have added that discussion of a new GF ignores the extent to which each GF is undergoing capacity expansions and battery production expansions also. These are quite amazing since both Grüneheide and Austin are being expanded before they're even open, Shanghai has new production being installed and Tesla even said they expect to raise Fremont production by ~60%.

It is obvious why even purported bulls usually underestimate results. The pace of development at TSLA has had no prior parallel, with the exception, perhaps, of WWII wartime mobilization; even there the logistics challenges spawned the Interstate highway System.

Tesla is doing the equivalent by singlehandedly establishing the Supercharger network. Thus far we don't even count that in forecasting, mostly because they don't give us enough data to allow that to happen. What we do see is rising margins, which encompass a long list of such advantages. @The Accountant has managed to do excellent forecasts without delving so deeply in these issues, but without a doubt his confidence is much less risky because he implicitly considered a litany of such advantages.

The factory efficiency questions loom large for all of us, but almost all of us cannot understand just how durable these advantages actually are. In part that may be because Elon does not really spend much time on what has already been done. He is far too busy attempting to tackle impossible problems. Those impossible ones take longer.

 

[Favguy]

Here are my key takeaways from the earnings call. Note that I have merely become rich from holding TSLA for a number of years now.

1. I am now very likely to become kilorich.
2. Pretty likely to become megarich.
3. Possibility now on the table to become gigarich.

If number 3 comes true, I will teraLOL.

Well I'm already Kilorich, but hoping to lose a few around the midriff by eating more healthily.

I'll get my coat...

I'd also have not given up the day job, if TSLA hadn't already done for it...

 

[mongo]

I assume that rear castings only won't last long, it is just too advantageous to use dual castings with a structural battery pack.

Another data point is that long term they plan to ramp cell production up to 200-250 GWh per year, while the short term goal is 100 GWh. That is well over 1M cars. It looks like the cell factory will have trial production towards the end of the year, Austin is clearly taking priority in terms of production equipment at the moment.

Yeah, I expect a transition to dual castings stuctural battery eventually, but only when new lines get added. Just like Fremont keeps the OG 3 line running when Shanghai has a casting based line.
No reason to rip out all the working infrastructure/ capacity and not have a use for 2170 (or LFP prismatic pack) capacity.

 

[ggr]

Mod: I remind all of you (expecially @Artful Dodger) that TMC has a rule about disparaging other members, and @Troy is a long-standing and valuable member of our community. He can't stand up for himself because there's also a rule about not promoting your own products/Patreon. So the discussion about the accuracy or otherwise of his estimates has reached a hard stop. --ggr

 

[Zero CO2]

I finally got around to reading the transcript of the quarterly earnings call. Now I understand why the market was so unhappy. I was super annoyed with Elon's comments about self-driving. I mean, we've all heard about the benefits of autonomous driving, ad nauseum. This is the most hyped vaporware technology in Silicon Valley history! I don't need another hype talk from Elon!

Just deliver the damn thing!

It's not just Tesla. Google/Waymo has been overhyping self-driving cars longer than Elon. GM/Cruise has made overpromises (full robotaxi rollout in 2019!) as egregious as Elon. Nowadays the autonomous car hype talk just gets eye rolls around Silicon Valley.

It's a whole thing of Elon poo-pooing Tesla's actual programs while hyping up vague projects in general AI, humanoid robots, and *groan* autonomous cars.

So you only focused on the FSD comments ... which by the way is not even accounted for in most analyst estimates ... and chose to ignore the 10 or so other hugely bullish items in Elons opening remarks i refer you here Earnings call 12 items

 

[PeterJA]

Disagree on just this one part (the rest of your comment is pure gold). The 25K Model is NOT delayed, that's a narrative cooked up by the financial media and analysts (which you've somehow internalized).

Telsa stated during the June 2019 AGM an aspirational goal to produce a $25K compact car in 3 or 4 years. There has NEVER been a schedule for its release, hence there can be no "delay".

Even Tesla's own quarterly Investor's letter has stated these words for many Quarters: "Future Project: In Development". There IS. NO. DELAY. Wall St. made one up to crash the SP.

Further, the 25K compact car is not even past the "aspirational" range stated 2.5 years ago. Yet people blindly parrot the "delayed" narrative, as if it was the case.

This is how the hedgies beat you, by getting you to repeat their falsehoods. Another win for the hedgies.

I have to disagree. Tesla's enemies often lie, but this "narrative" seems like either truth or honest confusion.

At Battery Day, Elon said "We're confident that longterm we can design and manufacture a compelling 25 thousand dollar electric vehicle." And since then, each quarterly Shareholder Deck has listed a "Future Product" as "In Development." So it seems reasonable to conclude that Tesla was working on said product.

But at the latest earnings call, Elon said "we're not currently working on the -- on a $25,000 car. We -- you know, at some point, we will, but we have enough on our plate right now...."

If you say "In Development" doesn't mean working on it now, well okay, but Tesla didn't make that clear until now.

Tesla often changes their plans based on new info or thinking. A clear example is their announcing the closing of all stores, then reversing that decision days later. This flexibility in planning is part of Elon's corporate culture of make mistakes without fear and learn from them. This flexibility/agility is very rare in huge corporations, because it rattles people. Mainstream culture considers it weakness, but actually it is a strength, as we can see from Tesla's (and SpaceX's) results: unprecedented pace of innovation and progress.

So when Tesla changes their plans, let's not deny they did, as if such change is a weakness. Let's try to spread the idea that it is strength. Hell yes, Tesla delayed new models, because demand for current models is off the charts. Tesla doesn't need a new $25k model until later than they first thought, if ever.

 

[Zero CO2]

With GM and Ford earnings next week...

Aren't the dealers better positioned to profit from the increased "margin" associated with the supply chain caused supply - demand dynamic? My thought is while the manufacturer struggles to get parts, they generally sell those vehicles to the dealerships at published wholesale pricing. It's then the dealerships that add huge market induced markups? Maybe the manufacturer is discounting less than usual to the dealers, but it seems like the stealerships are making the lions share of markups. So....the manufacturer is suffering from reduced efficiency from running their factories at reduced capacity/scale without much markup potential. Plus they are now throwing additional money investing in "getting in the EV game" also at very low rate production .... Seems like their earnings should be utterly dismal.

An interesting dynamic indeed ... not likely to end well for either Manufacturer or dealer of ICE... add the fact that OEM want to move to direct on-line sales model like Tesla and the EV startups

 

[dw4ngg]

Tesla often changes their plans based on new info or thinking. A clear example is their announcing the closing of all stores, then reversing that decision days later. This flexibility in planning is part of Elon's corporate culture of make mistakes without fear and learn from them. This flexibility/agility is very rare in huge corporations, because it rattles people. Mainstream culture considers it weakness, but actually it is a strength, as we can see from Tesla's (and SpaceX's) results: unprecedented pace of innovation and progress.

So when Tesla changes their plans, let's not deny they did, as if such change is a weakness. Let's try to spread the idea that it is strength.

100% this. Agility & humility are strength. Stubbornness & pride lead to all-day Biden-fests that MATTER. But Tesla is not trying to hang on by a thread and political favor; it is trying to change the world.