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

[henchman24]

The macro market is getting real close to breaking bear support on Vix... on a day with some 'bad' economic news.

And now we have a 28.50 break and rejection. If Vix getting some real downward pressure and getting below and closing below 28 will likely spark a strong rally for the rest of the week. So far there is noise and a drop, but behind the curtain... there is a very strong setup for a relief rally.

 

[Cherry Wine]

The macro market is getting real close to breaking bear support on Vix... on a day with some 'bad' economic news.

And now we have a 28.50 break and rejection. If Vix getting some real downward pressure and getting below and closing below 28 will likely spark a strong rally for the rest of the week. So far there is noise and a drop, but behind the curtain... there is a very strong setup for a relief rally.

If I'm interpreting correctly, SpotGamma seems to be speculating that the drop in VIX is tied to option expiration.

https://twitter.com/x/status/1526191799420723203

 

[StarFoxisDown!]

Wow, that's quite the negative sentiment for such a run of the mill Monday! I'll take that as a hyper-bullish indicator.

Will your projection change if we close green today?

Considering TSLA is now down 7-8X the macros, there's really no point in even entertaining that hypothetical

Obviously when selling pressure/negative sentiment flips, it will rally hard. But there's no way around how it's traded for the past two weeks, severely underperforming day after day and to me, it's pretty clear that the stock is very vulnerable to a quick 20-25% drop if the macro's take another leg lower.

Wall St a crystal clear roadmap to how to trade TSLA for the next two weeks at least, if not the next month and a half. There's no real catalyst for the stock until news comes out that Shanghai is back to full production. Until then, it's open season for dropping the stock on any given day......or if the past two weeks are any indication......every day.

I would like to think that Thursday was in fact the bottom, but if you're on margin, you definitely cannot be confident in the stock given the Friday and today.

 

[Featsbeyond50]

Wow, that's quite the negative sentiment for such a run of the mill Monday! I'll take that as a hyper-bullish indicator.

Will your projection change if we close green today?

I don't think SP is going as low as Starfox does but I agree with the gist of his post. My pessimism comes from looking at the chart for the S&P 500. We are in a clear downward channel and, in my opinion, while that downward channel is in place, the best we can hope for TSLA share price is to hang in there while the PE continues to compress. We want the fundamentals of Tesla to look more and more inviting for when the market does turn back. In the meantime, collect as many shares as humanly possible.

 

[heltok]

Watched an interview with @avoigt

Near the end he said that he thinks the government will bail out VW and keep them alive. Imo this scenario where carmakers are losing money but are being propped up by government doesn’t really make sense. Let’s just assume that it happens, how would it look like?

Year is 2030. Tesla are making 20M vehicles/year. VW is losing money but get money from the German government to keep them alive as a zombie company. Ok, let’s pretend this has happened. Let’s compare a customer, he considers if he should buy a VW Golf or a Tesla Model Golf/2.

The Tesla is $25k incl autopilot with $100/month extra for FSD and Tesla insurance. How much would he be willing to pay for the inferior VW Golf with less range, worse acceleration, worse autopilot, worse infotainment, worse supercharger network, dieselgate etc to choose it over the Tesla? Let’s say $20k. (Imo this is being generous)

Tesla are being manufactured super efficiently with single piece casting, using cheaper 4680 batteries, vertical integration, HW5 development shared by 20M vehicles etc costing the company $20k to produce and sold for a 25% profit before software revenue.

VW can make the same car for $25k as their scale is lower, they have to pay mobileye for active safety, they use more metal with no gigacasting, their batteries are more expensive from Northvolt and it takes more manhours on the production line. On top of that they have to spend another $5k for ads, dealerships etc. So the car will cost $30k for VW and sell it for $20k. So the German government will pay $10k/car that VW produces to keep the company alive? VW makes 5M cars/year, so $50B/year in subsidies to keep the company afloat? And this is without making any profits, just to keep the employees employed.

Where are my assumptions wrong or not plausible? Does it seem reasonable that Germany would pay VW $50B/year forever to make inferior cars at an ever growing loss?

And all the restructuring that keeps happening will that really help the organization to stay agile? Will it help them recruiting talent? No, it will just make them fall behind even more.

So how does the scenario where the Government keeps a Zombie car-company alive actually make any sense?

 

[henchman24]

If I'm interpreting correctly, SpotGamma seems to be speculating that the drop in VIX is tied to option expiration.

https://twitter.com/x/status/1526191799420723203

I think it is a bit simplistic to only tie it to options. March also had the same setup and trend, market reacted very differently. Add to that, market reacts very differently at ~30 than ~20.

 

[Chunky Jr.]

Interesting data point from Gary Black

https://twitter.com/x/status/1526233193447301122

 

[Nocturnal]

I know most of us don't put too much stock into what the analysts think, but it's still nice to see that we haven't seen any real downgrades. Our friend Mr. Ives just reiterated his $1400 PT as well.

Previous times that Tesla had been clobbered were because of how the company was performing, or at least appearing to perform. This time it's all macro. To me that suggests it's just a waiting game.

 

[Mengy]

I was curious to what today would be like, because it would say a lot about if Thursday was the bottom for TSLA. Unfortunately, seems clear that there’s going to continued intentional selling/capping pressure for a least all of May. And if the macros take another leg lower, I definitely see another 25% drop for TSLA. Probably an intraday dip well into the 500’s. So I hope everyone that is using margin has that kind of buffer

And now we have a 28.50 break and rejection. If Vix getting some real downward pressure and getting below and closing below 28 will likely spark a strong rally for the rest of the week. So far there is noise and a drop, but behind the curtain... there is a very strong setup for a relief rally.

Two very contradicting opinions, I don't know who to believe!!!

 

[Ogre]

Two very contradicting opinions, I don't know who to believe!!!

I believe in HODL. HODL conquers all.

 

[Ogre]

Watched an interview with @avoigt

Near the end he said that he thinks the government will bail out VW and keep them alive. Imo this scenario where carmakers are losing money but are being propped up by government doesn’t really make sense. Let’s just assume that it happens, how would it look like?

Year is 2030. Tesla are making 20M vehicles/year. VW is losing money but get money from the German government to keep them alive as a zombie company. Ok, let’s pretend this has happened. Let’s compare a customer, he considers if he should buy a VW Golf or a Tesla Model Golf/2.

The Tesla is $25k incl autopilot with $100/month extra for FSD and Tesla insurance. How much would he be willing to pay for the inferior VW Golf with less range, worse acceleration, worse autopilot, worse infotainment, worse supercharger network, dieselgate etc to choose it over the Tesla? Let’s say $20k. (Imo this is being generous)

Tesla are being manufactured super efficiently with single piece casting, using cheaper 4680 batteries, vertical integration, HW5 development shared by 20M vehicles etc costing the company $20k to produce and sold for a 25% profit before software revenue.

VW can make the same car for $25k as their scale is lower, they have to pay mobileye for active safety, they use more metal with no gigacasting, their batteries are more expensive from Northvolt and it takes more manhours on the production line. On top of that they have to spend another $5k for ads, dealerships etc. So the car will cost $30k for VW and sell it for $20k. So the German government will pay $10k/car that VW produces to keep the company alive? VW makes 5M cars/year, so $50B/year in subsidies to keep the company afloat? And this is without making any profits, just to keep the employees employed.

Where are my assumptions wrong or not plausible? Does it seem reasonable that Germany would pay VW $50B/year forever to make inferior cars at an ever growing loss?

And all the restructuring that keeps happening will that really help the organization to stay agile? Will it help them recruiting talent? No, it will just make them fall behind even more.

So how does the scenario where the Government keeps a Zombie car-company alive actually make any sense?

I could see a future where Tesla has 35% margins and VW has 5% margins. German government assists VW as essentially a jobs program. It could be sustainable for VW & Germany.

The bigger potential problem for VW is Robotaxi. If Robotaxi happens there is a solid chance and sales of private vehicles will collapse entirely.

 

[henchman24]

Two very contradicting opinions, I don't know who to believe!!!

Find the one that fits the narrative in your head!

 

[dhanson865]

You are massively overestimating equatorial boost and massively underestimating ITAR. The dv boost from the equator vs FL or TX is like 50m/s. Most of the benefit of equatorial launch is if you are going to geostationary orbit, as you can subtract a few hundred m/s of inclination change.

You replied in m/s and he posted in km/h. 50 m/s is 180 km/h which is more than twice the advantage you said was too high. Do you want to check your math again?

 

[Silent Ludicrosy]

Someone discovered a Tesla factory in Prum Germany that is somehow involved in 4680 cells/packs/testing.

 

[heltok]

I could see a future where Tesla has 35% margins and VW has 5% margins. German government assists VW as essentially a jobs program. It could be sustainable for VW & Germany.

The bigger potential problem for VW is Robotaxi. If Robotaxi happens there is a solid chance and sales of private vehicles will collapse entirely.

I don’t see this as an equilibrium. If Tesla has 35% margins they will just expand production, lower prices and take more market. At some point they will eat the competition… And like I argued above, there will be more than a 30% difference in margins between Tesla and VW, more like +20% vs -33%.

 

[StarFoxisDown!]

Two very contradicting opinions, I don't know who to believe!!!

Well, @henchman24 and I could both be right. There very well could be a relief rally before another leg lower in say 3 weeks, right before May's CPI and PPI come out.

My main point is the trading on TSLA specific.

Today, Nasdaq down 1%, TSLA down 4.5%. TSLA has been underperforming it's beta by about 3X, sometimes 4X on down days and hasn't been up more 2X on any macro up days over the past two weeks. Given how TSLA has traded over the past two weeks, if say the Nasdaq rallies 10% over the next two weeks, TSLA only goes up 12-15%. Then the Nasdaq has a 15% drop/leg lower and TSLA does down 40%.

That scenario will have TSLA down in low 600's, upper 500's.

Again, I think there's a very focused effort to drop TSLA as much as possible before Q2 P/D numbers because once Q2 is past us, the stock is going to be forced higher...and how fast it goes higher will be directly related to Tesla's earnings/growth execution.

 

[ZachF]

You replied in m/s and he posted in km/h. 50 m/s is 180 km/h which is more than twice the advantage you said was too high. Do you want to check your math again?

Earth rotation = 460m/s

460m/s cos 28deg = 406m/s

460 - 406 = 54m/s

54m/s extra dv will increase payload by like 2%

 

[SOULPEDL]

Find the one that fits the narrative in your head!

What HODLing feels like.

 

[Gigapress]

You are massively overestimating equatorial boost and massively underestimating ITAR. The dv boost from the equator vs FL or TX is like 50m/s. Most of the benefit of equatorial launch is if you are going to geostationary orbit, as you can subtract a few hundred m/s of inclination change.

I may be overestimating the impact, but bear in mind that payload mass decreases exponentially with respect to dV, and that total payload mass per Starship is fundamental to accelerating the achievement of multiplanetary life.

I worked for Boeing for 6 years and am fairly familiar with aerospace ITAR restrictions. Indonesia is a friendly US ally. Overall, American export of advanced weapons and other “defense articles” to Indonesia totals $1.9B worth per year (source), and we sell billions more worth of commercial airplanes. If we can legally give Apaches, Javelins and F-16s to Indonesia, then it seems unlikely that commercial Starship/Superheavy launches would be prohibited. I also don’t see how the Indonesian government leaders, who certainly meet with US DoD leadership on occasion, would somehow be unaware of the fact that their space development idea is illegal.

I still believe Indonesia will be the next major country for expansion of both Tesla and SpaceX.

 

[TheTalkingMule]

I don’t see this as an equilibrium. If Tesla has 35% margins they will just expand production, lower prices and take more market. At some point they will eat the competition… And like I argued above, there will be more than a 30% difference in margins between Tesla and VW, more like +25% vs -50% on the cost of production.

Germans will benefit from Tesla working in their homeland IMO. They can easily make the android version of Telsa's iPhone while using it purely as a jobs program, as noted above. Remember, Elon has all these FSD/Mars-based costs to add to his products, VW simply needs to make an EV Beetle. (not in form, but in societal function)

Then if/when Tesla gets too far ahead and they're looking at near term obsolescence you license FSD from the $6T Tesla behemoth. Once FSD is out a few years and Tesla owns the universe, they're not going to be able politically(or want to ethically) keep the tech in-house only.

The Germans will have no problem navigating this transition, they practically started it on their own. (renewables, not EVs obviously)