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

[Cult Member]

GIGAFACTORY BERLIN BRANDENBURG
I had the chance to attend the opening event yesterday. As always: TESLA knows how to party
We have been a group of TESLA OWNERS CLUB members (TFF e.V.) mixed with the first 30 Model Y customers and few TESLA staff. The customers got a Factory Tour and saw a running production. Two of the GIGAPRESS were in operation. The next two should follow soon. Elon did the handover of the Keycards for each of the 30 Y's and has been in an extremely good mood all the time. Each Customer could choose their own music for this special moment and all of them had the big fat TESLA grin on their face. It last at minimum to the next SuC 200 km south of Berlin where we met two of them again
The good mood is a permanent condition at the TESLA team, as they reported themselves. You are in a bad mood in the morning? A few minutes in the Shuttle bus from train station to the Gigafactory and it changes to the opposite.
The first Model Y's had a VIN beginning in the 17xx range. The row of vehicles for the offered test ride were in the 13xx range.

 

[mongo]

Who cares?

The exercised calls to buy the shares. So their effective exposure is unchanged. 2 weeks ago they owned 25 calls. Today they own 2500 shares. Every dollar Tesla goes up they make 2500 either way. (At least that close to expiration its pretty damned close to the same)

Their Delta didn't change (DITM single digit DTE vs shares), but exposure (at risk) did.
Before it was the cost of 25 options, now it's $1.25 million (500 strike * 25 *100) from exercise plus the cost of the options. Alternatively around $2.4 million present value. Depending how one views risk.

 

[jbcarioca]

I have Schwab and the Schwab ratings for stocks are not based on anything like growth or appreciation or whatever. I respect the Schwab ratings for what they are, but they are not what I'm looking for when investing.

I was preparing to make a similar post. For the passive, mostly issuer ignorant crowd the rating makes sense since it is a decent volatility metric. It is useless for anybody who is active on this forum, but we’re all too opinionated for any generic ratings of anything, or so it seems to me.

 

[Cattledog]

Small data point - We bought our Model Y in February 2021 for $51,990, today that car on the same configuration is $64,990. We have a LR Model X on order from a year or so ago, and are expecting to use the Model Y as trade-in. Every month, the trade-in value 'expires' and I have to input the mileage for them to revalue the trade-in (you would think they could just pull the data if I authorized them to to that, anyways...).

Every month or so when I do this the re-valued trade has crept up a few hundred dollars, so that when I last updated in late-January the trade in was something like $53,500.

Yesterday it came in at $58,900. Almost $7,000 more than when new, a 13% increase. This is for a 13-month old car with 7,000 miles on it.

Almost a coin toss if I should have sold TSLA to buy appreciating Teslas!

This must have something to do with investing in TSLA, so shared here...

 

[Mengy]

With Elon currently preparing the Master Plan III and now his comments from Berlin yesterday, does anyone else get the feeling our expectations for Tesla's future might be too conservative?

Like, I think most of us expect Tesla to be producing 3TWh's worth of batteries and about 20 million EV's per year in 2030, but I'm starting to feel like Tesla might be increasing their goals to reach even higher levels much sooner than anyone expects. Between Elon's recent hints that Optimus is now Tesla's highest priority and his comments yesterday on the world's immense battery needs, plus him stating 70%+ growth per year (or more!) is attainable for Tesla, my gut is telling me Tesla is planning to go into Extreme Growth Mode the likes of which the world has never seen.

My gut's been wrong before, but I'm getting this itch telling me my expectations are too low for this company....

 

[CHGolferJim]

Small data point - We bought our Model Y in February for $51,990, today that car on the same configuration is $64,990. We have a LR Model X on order from a year or so ago, and are expecting to use the Model Y as trade-in. Every month, the trade-in value 'expires' and I have to input the mileage for them to revalue the trade-in (you would think they could just pull the data if I authorized them to to that, anyways...).

Every month or so when I do this the re-valued trade has crept up a few hundred dollars, so that when I last updated in late-January the trade in was something like $53,500.

Yesterday it came in at $58,900. Almost $7,000 more than when new, a 13% increase. This is for a 13-month old car with 7,000 miles on it.

Almost a coin toss if I should have sold TSLA to buy appreciating Teslas!

This must have something to do with investing in TSLA, so shared here...

Must be tempting to sell it and drive a Hertz Model 3 on the monthly rate until your X arrives

 

[Hock1]

You don't need Schwab ratings if you want to match the indexes. That's not my style of investing and there is no way I could have achieved what I have by using Schwab ratings.

The lower the "rating", the higher the potential return. I've had several multi-baggers in my career. None of them have had an "A" until it was time to sell, if ever.

 

[Cult Member]

With Elon currently preparing the Master Plan III and now his comments from Berlin yesterday, does anyone else get the feeling our expectations for Tesla's future might be too conservative?

Like, I think most of us expect Tesla to be producing 3TWh's worth of batteries and about 20 million EV's per year in 2030, but I'm starting to feel like Tesla might be increasing their goals to reach even higher levels much sooner than anyone expects. Between Elon's recent hints that Optimus is now Tesla's highest priority and his comments yesterday on the world's immense battery needs, plus him stating 70%+ growth per year (or more!) is attainable for Tesla, my gut is telling me Tesla is planning to go into Extreme Growth Mode the likes of which the world has never seen.

My gut's been wrong before, but I'm getting this itch telling me my expectations are too low for this company....

I'm sure that Habeck, the Federal Minister for Economic Affairs and Climate Action asked him in Berlin if Tesla can help in getting rid of Russian fossil energy supply. Finally Tesla Energy awakes at the right time.

 

[Artful Dodger]

my gut is telling me Tesla is planning to go into Extreme Growth Mode

The limits to growth are chip supply in 2022, bty cells in 2023, then bty raw materials there-after.

That's why Tesla has moved quickly to secure long-term mining contracts, but those minerals don't just poof themselves into the hopper. It can take 7-10 years to develop a new resource into an ongoing supply of raw materials.

Which makes 7-10 years an ideal investment horizon for TSLA.

Cheers!

 

[Mengy]

That's why Tesla has moved quickly to secure long-term mining contracts, but those minerals don't just poof themselves into the hopper. It can take 7-10 years to develop a new resource into an ongoing supply of raw materials.

Which makes 7-10 years an ideal investment horizon for TSLA.

It also used to take many years to build new automotive factories, yet Tesla can do it in 1-2 years repeatedly. What if Tesla starts it's own mines to address that long lead time? They are about to be very cash flush, is it unrealistic to think Tesla could get a mine up and running in half the time it "usually" takes?

 

[PeterJA]

With Elon currently preparing the Master Plan III and now his comments from Berlin yesterday, does anyone else get the feeling our expectations for Tesla's future might be too conservative?

Like, I think most of us expect Tesla to be producing 3TWh's worth of batteries and about 20 million EV's per year in 2030, but I'm starting to feel like Tesla might be increasing their goals to reach even higher levels much sooner than anyone expects. Between Elon's recent hints that Optimus is now Tesla's highest priority and his comments yesterday on the world's immense battery needs, plus him stating 70%+ growth per year (or more!) is attainable for Tesla, my gut is telling me Tesla is planning to go into Extreme Growth Mode the likes of which the world has never seen.

My gut's been wrong before, but I'm getting this itch telling me my expectations are too low for this company....

Elon said two months ago:

"Capacity expansion will continue through maximizing output of each [current] factory and building new factories and new locations in the future. Although we’re not ready to announce any new locations on this call, but we will, through 2022, look at new locations and probably announce new locations towards the end of this year.”​

That's "locations," plural. This year.

 

[jeewee3000]

It also used to take many years to build new automotive factories, yet Tesla can do it in 1-2 years repeatedly. What if Tesla starts it's own mines to address that long lead time? They are about to be very cash flush, is it unrealistic to think Tesla could get a mine up and running in half the time it "usually" takes?

At Battery Day Elon and Drew discussed the raw materials required for battery cell production at length.

The same three-tier battery type as Elon mentioned yesterday at the Giga Berlin opening were discussed here:
- iron for lower/medium range
- nickel-manganese for medium/high range
- high nickel for high range

Regarding nickel Elon said:
"So in order to scale, we really need to make sure that we’re not constrained by total nickel availability. I actually spoke with the CEOs of the biggest mining companies in the world and said, “Please make more nickel, this is very important.” And so I think they are going to make more nickel."

They went on to explain that the cathode process will be simplified greatly by Tesla by eliminating the metal sulfate processes. This will reduce complexity in mining as well:

Spoiler: lengthy quote

Elon:
It’s insanely complicated. It’s a small world journey of, “I am a nickel atom, what happens to me?” And it is crazy. You’re going around the world three times, there’s the moral equivalent of digging the ditch, filling the ditch and digging the ditch again, it’s total madness basically. And these things just grew up, they’re just kind of like legacy things, it’s like how it was done before and then they connected the dots but really didn’t think of the whole thing from a first principle standpoint saying, “How do we get from the nickel ore in the ground to the finished nickel product for a battery?” So we’ve looked at the entire value chain and said, “How can we make this as simple as possible?”

Drew Baglino:
And that’s what we’re proposing here with our process. As you can see, a whole lot less is going on here. We get rid of the intermediate, metal, water, final product cathode, recirculate the water, no wastewater at all. And when you summarize all of that it’s a 66% reduction in CapEx investment, a 76 reduction in process costs and zero waste water. Much more scalable solution.

Drew Baglino:
And then when you think about the fact that now we’re actually just directly consuming the raw metal nickel powder, it dramatically simplifies the metal refining part of the whole process. So we can eliminate billions in battery grade nickel intermediate production. It’s not needed at all. And we can also use that same process we showed on the previous page to directly consume the metal powder coming out of recycled electric vehicle and grid storage batteries. So this process enables both simpler mining and simpler recycling.

Therefore Tesla will be more efficient with the nickel supplied to them than its competitors.

Mining nickel by Tesla itself has not been hinted at if I recall correctly.

Lithium on the other hand, Tesla has the rights to a lithium clay deposit in Nevada:

Spoiler: lengthy quote 2

Elon Musk:
Yeah, people haven’t been trying because it’s just widely available. But it is important to say, “Okay, what is the smartest way to take ores and extract the lithium and do so in an environmentally friendly way?” And we actually discovered… Again, looking at it a first principles physics standpoint, instead of just the way it’s always been done, is we found that we can actually use table salt, sodium chloride, to basically extract the lithium from the ores. Nobody’s done this before, to the best of my knowledge, nobody’s done this. And all the elements are reusable, it’s a very sustainable way of obtaining lithium. And we actually got rights to a lithium clay deposit in Nevada.

Drew Baglino:
Over 10,000 acres.

Elon Musk:
Over 10,000 acres. And then the nature of the mining is actually also very environmentally sensitive in that we sort of take a chunk of dirt out of the ground, remove the lithium, and then put the chunk of dirt back where it was. So it will look pretty much the same as before, it will not look like terrible. And yeah, it’ll be nice.

Drew Baglino:
Simply mix clay with salt, put it in water, salt comes out with the lithium, done.

Elon Musk:
Yeah. It’s pretty crazy.

Drew Baglino:
Yeah. So we’re really excited about this and there really is enough lithium in Nevada alone to electrify the entire US fleet.

TL;DR:
Tesla will mine lithium, but most likely not nickel. Tesla has however entrenched itself with nickel mining companies. The future of Tesla is bright.

 

[Artful Dodger]

It also used to take many years to build new automotive factories, yet Tesla can do it in 1-2 years repeatedly. What if Tesla starts it's own mines to address that long lead time? They are about to be very cash flush, is it unrealistic to think Tesla could get a mine up and running in half the time it "usually" takes?

Like getting the permits for Giga Berlin? Yeah, Tesla isn't the bottleneck.

Ask yourself why the construction of the lithium hydroxide plant at Giga Texas was delayed. Oh, that's right. A 3-person appointed 'environmental' panel in N. Carolina is 'concerned' about dust on the road! 18 month delay! No soup 4 u!

In push to supply Tesla, Piedmont Lithium irks North Carolina neighbors | Reuters (July 20, 2021)​

​

Tesla agrees to delayed shipment from Piedmont Lithium (August 3, 2021)​

​

Piedmont Lithium Releases Updated Corporate Presentation for November 2021 - Piedmont Lithium​

The water supply issue in Brandenburg is still not resolved, which could affect the speed of Phases 2-4. Then how about "deadline creep" for EPA reviews in Boca Chica?

When 3rd Parties are involved, things don't always move at "Tesla speed". Especially when said parties (competitors) have a vested interest in seeing Elon slowed down.

 

[ZachF]

That number is so hard to comprehend.

Anyone have a sense of how to get there?

If you went back ~150 years and told people about the world of today’s production people would probably think you’re mad.

 

[Nocturnal]

I'm dying to see what Elon means by "massive expansion" in Master Plan #3. Doesn't seem like he means cars based on other comments.

Batteries perhaps? Storage? Pedal is already to the metal for FSD and AI.

 

[2daMoon]

... and BOOM goes the dynamite!

 

[ZeApelido]

Hello $1000 my old friend.

 

[Big Time]

Nice move

 

[KMCC]

Must be tempting to sell it and drive a Hertz Model 3 on the monthly rate until your X arrives

Or you could rent my model 3.

The day Tesla hit $1250 my wife and I bought a model y purely on a whim

I love my 2018 model 3 so much I don't think I could sell it, so I'm going to put it on turo I'm guessing it will rent really well I did it three years ago and it worked great.

(Don't need the money might donate it)

Every time I get into my Tesla I am reminded that it's part of what got me to buy quite a few shares pre split and change my life forever.

 

[Nocturnal]

Or you could rent my model 3.

The day Tesla hit $1250 my wife and I bought a model y purely on a whim

I love my 2018 model 3 so much I don't think I could sell it, so I'm going to put it on turo I'm guessing it will rent really well I did it three years ago and it worked great.

(Don't need the money might donate it)

Every time I get into my Tesla I am reminded that it's part of what got me to buy quite a few shares pre split and change my life forever.

I had the exact same push to go heavy in to TSLA (my 18 P3) and will have the same dilemma when it's time to replace it.