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

[Blue horseshoe]

Listened to the interview again and although there is some debate I'm happy to hear Tesla will aim to now produce 30 Twh of batteries or 10% of the 300 Twh Elon believes the world will need to produce annually around 2030. This is a 10x increase from the original 2030 goal and in line with Elon's recent statements regarding massive expansion.

Solving the money problem video scroll to about 2:15 to see Steven's discussion on the topic.

 

[Artful Dodger]

Tesla will aim to now produce 30 Twh of batteries ... This is a 10x increase from the original 2030 goal

The aspirational goal given on Battery Day was 3 TWh/yr production. That's a rate, which is different from a goal of cumulative total production of 30TWh.

It does tell us that Tesla could do their intended share of battery production by 2040 at that rate. This is an important point, due to the ~10 yr lag in the climate system. 2050 climate depends on what we do this decade.

 

[Mengy]

The aspirational goal given on Battery Day was 3 TWh/yr production. That's a rate, which is different from a goal of cumulative total production of 30TWh.

It does tell us that Tesla could do their intended share of battery production by 2040 at that rate. This is an important point, due to the ~10 yr lag in the climate system. 2050 climate depends on what we do this decade.

True, but much of what Elon has alluded to lately does make me think his Master Plan Part III will heavily lean on Tesla accelerating their battery production plans to scale at a much higher rate than previously planned.

 

[Blue horseshoe]

The aspirational goal given on Battery Day was 3 TWh/yr production. That's a rate, which is different from a goal of cumulative total production of 30TWh.

It does tell us that Tesla could do their intended share of battery production by 2040 at that rate. This is an important point, due to the ~10 yr lag in the climate system. 2050 climate depends on what we do this decade.

Elon's recent interview 300Twh of battery discussion around 5 min in. Hopefully we can get some more clarity, but listening again I realize Elon states he believes the world will need 300 Twh of installed capacity.

So his goal of Tesla providing 10% or 30Twh of that capacity is not a runrate (as I'd wishfully hoped). Still, I remain hopeful we see a higher runrate in 2030 than 3Twh/year

 

[nativewolf]

True, but much of what Elon has alluded to lately does make me think his Master Plan Part III will heavily lean on Tesla accelerating their battery production plans to scale at a much higher rate than previously planned.

The massive expansion to me is clearly an indication that planning at tesla automotive and energy slipped. Batteries are the key to solving the issue of sustainability, that's been so so clear for 2 years. Not FSD...not robots. Batteries. It was so very clear that Tesla was relying on a massive amount of 3rd party production to make up for an under investment in capacity that if Tesla was successful in transforming the direction of the automotive market (a goal) they were actually at risk (too much competition for 3rd party battery production). The situation in the Ukraine just highlights that point and the situation with LGs pouch battery production highlighted the risk of relying on 3rd parties for key components. With EVs it is all about the battery. it's why Ford and Edison could not get a viable car company started 100 years ago. Batteries. For now and for the next 5 years it is all about scaling battery production. It's going to take (GROSS APPROXIMATIONS) 15 million EVs to displace global oil by a million barrels. Or something like a million trucks. Until that point we hardly have any capacity to divert into energy storage. Energy storage is the coup de grace, so we have to get to real battery storage at scale. We use 75 million barrels a day. We have to strip all the auto and energy production out and leave just airplanes and heavy machinery. And we should, as a society, be focused on attacking those as well.

It's also why every EV is a good EV. I can't believe people buy Audi or VW EVs but whatever, that is a poor decision that helps the environment. Good.

 

[Artful Dodger]

True, but much of what Elon has alluded to lately does make me think his Master Plan Part III will heavily lean on Tesla accelerating their battery production plans to scale at a much higher rate than previously planned.

I created a model over the weekend to see what global yearly production (Tesla + Industry) increases might be needed to reach 300TWh installed capacity by 2050. Assumes 1.5x production CAGR to 20 TWh/yr, then holding until 300 TWh produced:

Elon's comments on Battery Day in Sep 2020 and during his TED2022 interview are consistent with these targets. Note that with geometric growth, it's all about the "CAGR" while the initial starting point changes the end date by a year or less.

Elon did not discuss this in the first 2 "Secret Master Plans". I think he will spell it out in Part 3. Concretely, I predict that Tesla will need a factory that builds battery factories to make this possible (or one on each of the 3 existing continents).

So [Elon's] goal of Tesla providing 10% or 30Twh of that capacity is not a runrate (as I'd wishfully hoped). Still, I remain hopeful we see a higher runrate in 2030 than 3Twh/year

As long as the world production of batteries reached 20 TWh/yr sometime in the 2030, I think we'll be okay. If Tesla only needs to produce 3 TWh/yr of this that's fine.

What's also clear is that Tesla can scale fro 3 to 20 TWh/yr production in just more 5 years if they have to (ie: other industry drags their feet). Tesla would then need to get into mining. For example, how much to buy Australia?

#PREDICT

 

[Usain]

Most of your profits come from the £1.8Bn third point. I doubt that the chip in the cable is the chip that Tesla are missing. I'm not even sure that Tesla are single chip constrained. Even if they are, building an extra 5% may not be possible and neither does delta gross profit translate to net profit 100%.

Yes, I was aware of those points, and they are good ones.

But Elon did say that the limiting factor was simple chips that did things like control the seats. So it is possible that I'm right and that removing the portable charger allows Tesla to make some extra cars.

Also, for those extra cars, gross profit and net profit shouldn't diverge very much.

And if removing the charger doesn't allow extra cars, I'm pretty confident that my $300,000,000 additional gross profit in 2023 is in the ballpark. Then the number grows each year as Tesla builds more cars. Maybe they could use the cash to build an extra Gigafactory.

This removal of the portable charger is a nice move for investors. I think other EV makers will follow if they can.

 

[UncaNed]

“You will never be able to recharge an EV in two minutes like you refuel now..."

Good luck with that dude!

Mine takes only 10 seconds a day to plug in at night and unplug in the morning, and very few trips to a gas or charging station - less overall charging time than when I drove an ICE.

 

[UncaNed]

Ummm....this is awesome. Never seen something like this before....

https://twitter.com/x/status/1515462245534240769

We all need to post this 15.9 cents per kilowatt hour meme to our social media sites immediately. Especially to respond to short sighted idiots complaining about the price of gas rising from supporting Ukraine.

 

[Mengy]

What's also clear is that Tesla can scale fro 3 to 20 TWh/yr production in just more 5 years if they have to (ie: other industry drags their feet). Tesla would then need to get into mining.

At this point I think it's inevitable Tesla gets into mining. I know a lot of investors do not want them to, but the mining industry isn't ramping with the EV and green energy industry and someone will need to step up and fill the lag. My gut tells me Tesla will simply vertically integrate further into mining and show the world new better & faster ways to mine.

 

[Usain]

I expect car sales to drop significantly from 75 million per year by 2030:

1. BEVs lasting 3-4x longer than ICE equivalents.
2. The transition to renewables leads to improved public transit and increased usage.
3. Autonomous vehicles decrease purchases considerably. Many 2 vehicle households drop to 1 vehicle and many others don’t ever even bother to own.
4. Autonomous vehicles and better collision avoidance safety features result in far fewer collisions thereby increasing the lifespan of vehicles.
5. We’ve proven that working from home is a viable alternative to committing to the office 5 days a week.
6. If BEVs are still production constrained, by then, very few will be willing to buy a new ICEv so will be holding out for a BEV.

The total number of cars sold per year will decline significantly and I expect Tesla to keep ramping up production if others continue to slow play the transition. It wouldn’t surprise me to see Tesla produce more than 20 million per year if the demand is there and others can’t compete still.

While not my expectation, I would not be surprised if Tesla is selling 50 to 70% of vehicles outside of Asia in 2030.

I've seen some very smart people say car sales will drop significantly by 2030. And I've seen some very smart people say cars sales will rise significantly by 2030.

When making predicitons about 2030, using today's rough estimate of 75 million units per year seems like as good a number as any.

 

[Usain]

Elon's recent interview 300Twh of battery discussion around 5 min in. Hopefully we can get some more clarity, but listening again I realize Elon states he believes the world will need 300 Twh of installed capacity.

So his goal of Tesla providing 10% or 30Twh of that capacity is not a runrate (as I'd wishfully hoped). Still, I remain hopeful we see a higher runrate in 2030 than 3Twh/year

We may "need" 300Twh, but we can find a use for 3000Twh.

My view is that for the rest of this century, the world will "want" as many batteries as it can possibly produce. Every cell is like manufacturing a little brick of gold.

 

[BioSehnsucht]

I guess Tesla has it wrong, EV's are not the future.

Electrification not the answer: Aston Martin

Aston Martin’s design boss also believes that internal combustion engines can become zero-emission power units

www.drive.com.au

“You will never be able to recharge an EV in two minutes like you refuel now..."

Good luck with that dude!

Bond is in a hurry.

Some googling says

• US limits pumping speed to 10 gallons per minute (I don't think I've ever filled up a < 20 gallon tank in less than a few minutes though, so I don't think all pumps are created equal much less to this limit ... )
• Aston Martin DB11 gets 18 city / 24 highway MPG, let's call it 21 MPG mixed
• Plaid S can apparently do up to 5 minutes at 250kW depending on SOC
• Plaid S gets 102 city / 99 highway MPGe (with 1 gallon of gasoline being ~ 33.7 kWh, 330 and 340 Wh/mi), let's call it 101 MPGe mixed

Therefore 2 minutes, theoretical max range added is 42 miles for the Aston, and (based on this article) almost 28 miles for the Plaid S (assuming we arrive at optimal SOC). But wait! we should subtract the time fiddling with the gas cap and payment for the Aston, let's call that about 30 seconds. Now we're at 32 miles vs 28 miles. Ok, fine, still not winning. Need another 10 seconds or so delay on the Aston. Maybe the card reader is slow, or the pump isn't running at full speed. When we get 350kW charging, for at least a little bit during peak charge rate, we should be gaining miles faster, at least.

But since the context was not purely BEV vs ICE, but BEV vs FCEV or Bio/synthfuel ICE... Well we know Hydrogen is going to be way more trouble and slower than ICE (even though they claim to be much faster, I've seen many reports about having to wait for the hydrogen station to repressurize before they can fuel their FCEV). Though Bio/synthfuel will presumably be the same speed, roughly, as regular gasoline.

FCEV is a dead end for many reasons, and while there are niches where Bio/synthfuel may still be king, if we're assuming "100% clean energy", then BEVs still have a huge cost advantage that will be hard to ignore since "clean energy" fuels are basically just EVs with extra steps.

So Bond can keep his few seconds of advantage, while he stresses out about fuel costs and villains. I'll stick to BEVs which I almost never need to stop to charge, because my home is my fuel station, and when I'm on a road trip, well, I'm only human - I need a break every few hours anyways.

 

[AudubonB]

As promised -

Home charging discussion, specifically wrt which method to use, is to be posted elsewhere. Enjoy the upcoming very interesting investment week!

 

[BioSehnsucht]

We may "need" 300Twh, but we can find a use for 3000Twh.

My view is that for the rest of this century, the world will "want" as many batteries as it can possibly produce. Every cell is like manufacturing a little brick of gold.

With enough energy (and perhaps some fancy work with materials science), we can probably do a lot of recycling of raw materials of even things that "aren't recyclable" in the same way that fuel refineries work - just crank up the heat until everything vaporizes and then progressively cool it and pull off the different materials as they recondense. Of course we're talking about some absolutely hilariously high energy usage, but hey, if we've got it, why not? I'm assuming if we've 10x'd our needed storage, we've 10x'd or more our energy generation needs too (i.e. a lot of solar, etc) and have energy to spare for inefficient improvement projects. In a similar vein, moving to stacked indoor farms (not hydroponics but just layered regular plants and soil etc) with artificial lighting and climate (think buildings with the footprint of a gigafactory but possibly with even more floors), both for plants and animals (reclaim all that methane, too!), and letting much of our agricultural use land go back to being wild...

 

[Tim S]

Some googling says

• US limits pumping speed to 10 gallons per minute (I don't think I've ever filled up a < 20 gallon tank in less than a few minutes though, so I don't think all pumps are created equal much less to this limit ... )
• Aston Martin DB11 gets 18 city / 24 highway MPG, let's call it 21 MPG mixed
• Plaid S can apparently do up to 5 minutes at 250kW depending on SOC
• Plaid S gets 102 city / 99 highway MPGe (with 1 gallon of gasoline being ~ 33.7 kWh, 330 and 340 Wh/mi), let's call it 101 MPGe mixed

Therefore 2 minutes, theoretical max range added is 42 miles for the Aston, and (based on this article) almost 28 miles for the Plaid S (assuming we arrive at optimal SOC). But wait! we should subtract the time fiddling with the gas cap and payment for the Aston, let's call that about 30 seconds. Now we're at 32 miles vs 28 miles. Ok, fine, still not winning. Need another 10 seconds or so delay on the Aston. Maybe the card reader is slow, or the pump isn't running at full speed. When we get 350kW charging, for at least a little bit during peak charge rate, we should be gaining miles faster, at least.

But since the context was not purely BEV vs ICE, but BEV vs FCEV or Bio/synthfuel ICE... Well we know Hydrogen is going to be way more trouble and slower than ICE (even though they claim to be much faster, I've seen many reports about having to wait for the hydrogen station to repressurize before they can fuel their FCEV). Though Bio/synthfuel will presumably be the same speed, roughly, as regular gasoline.

FCEV is a dead end for many reasons, and while there are niches where Bio/synthfuel may still be king, if we're assuming "100% clean energy", then BEVs still have a huge cost advantage that will be hard to ignore since "clean energy" fuels are basically just EVs with extra steps.

So Bond can keep his few seconds of advantage, while he stresses out about fuel costs and villains. I'll stick to BEVs which I almost never need to stop to charge, because my home is my fuel station, and when I'm on a road trip, well, I'm only human - I need a break every few hours anyways.

I agree with your point, but your math is off. In 2 minutes of pumping gas, you will add 420 theoretical miles to the Aston, not 42. (If the Aston had a 20-gallon tank).

The more important point is that it only takes a few seconds to plug in an EV at home every night, and you start each day with a full "tank".

 

[UkNorthampton]

Do you want the five minute argument or the full half hour?

Andrew Till's wife Flaviana (sp?) was very anti-Tesla (Model 3) but seems to have changed opinion based on ease of travelling long distances (previous trip of UK to Italy in an e-Niro wasn't fun - using a top-box didn't help range). She wants Model Y or X.

I see a few people on TMC's UK forum discussing getting non-Teslas, but I think there will be lots of non-Tesla owners whose second EV will be a Tesla. LIfe is just easier and more fun with Teslas.

 

[Mengy]

It's like the market this morning can't decide if it wants to be up or down....


But now, I think it's going down.

 

[Stretch2727]

And they don't even mention Space X.

In Defense of Elon Musk's Managerial Excellence​

In Defense of Elon Musk's Managerial Excellence

The Tesla CEO’s track record proves he’s a pre-eminent builder of businesses and maximizer of shareholder value.

www.bloomberg.com

 

[woodisgood]

It's like the market this morning can't decide if it wants to be up or down....


But now, I think it's going down.

Take note, this is a masterclass in the use of reverse psychology to fake out the market.