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

[Singuy]

The Inflation Reduction Act has received the CBO score that Democrats were hoping for and voting is happening right now. Live stream on CSPAN: U.S. Senate | Event | C-SPAN.org

When there's a vote, then the chances of passing is near 100%(except that one time Mccain totally screwed it up for the republicans with rejecting obamacare).

These votes only happen if it's 100% set to pass or 100% set to fail (failing to pass is used for political points only). Usually there's no surprises.

 

[MC3OZ]

At the same time raw material scaling needs to be solved and/or fsd needs to be solved. There's not enough demand for 20M cars with an asp of 50k unless fsd is solved or asp drop big time through 4680/or smaller compact car. Lots have to go right for that 20M goal besides just building the factories.

Also if optimus is a thing, that need factories too.

Building Optimus doesn't need a lot of space and will not be overly complex.

Elon and Drew make frequent comments about raw materials.

The 20 Million by 2030 is an aggressive stretch target. But it probably catches the attention of the rest of the industry.

I would like to see the US improve its diplomacy when dealing with China. But everyone knows thst clean enegy and transport are the future, and most companies want to be part of the future.

 

[AudubonB]

It's literally a fan site. Can we issue some warnings for these whiney-preambles about fans acting like fans on a fan site?

….

No, this thread is NOT a fan site. If I had wanted it to be one, I would not have named it as it is.

Yes, most who are interested in the relationship between Tesla, TSLA and the financial markets in general are indeed supporters of Tesla and its…and Mr Musk’s…missions. From the perspectives of those people, any sane person, any persons who can think for themselves, any who are less likely to be gulled by miscreants, are or will end up as you call them: “fans”. But for many reasons, the most important of which is to diminish the likelihood of becoming blind to cautionary messages, naysayers on this site are given and always will be given very wide latitude. Calls for a poster to be banned as a troll are never: Not Ever acted upon in haste.

Never.

 

[Gigapress]

2 perfect examples of this:

1. The dry battery electrode process uses much less factory square footage than the wet process.

2. The Gigacastings save tons of stamping floor space and robots, reducing consumed factory volume significantly.

These types of innovations will continue, allowing factories to become more and more dense.

2+ . Gigacastings plus structural pack should also save a lot of floor space in General Assembly as well, because more people can work on the car simultaneously at a single production cell due to improved access and deletion of most ergonomic safety constraints.

3. Tesla’s new factory designs, beginnning with Giga Shanghai a couple years ago, are going vertical and taking advantage of all three dimensions. Factory design getting closer to Elon’s ideal of being similar to an integrated circuit. To a first approximation, this takes all the other floor space savings and multiplies them by the number of floors in the factory.

4. No inventory warehouse —> No floor space needed for stuff just sitting around. Also, having materials unloaded from trucks directly lineside reduces the need for truck/forklift roadways in the factory, improving the ratio of area used for production to area used for transportation.


The “Go Giga” video released on 12/9 last year showed many of these floor space benefits and discussed the principle of maximizing the utility of every cubic meter of space. Here are the parts of my notes from the numerology thread regarding space efficiency:

I haven't finished writing out analysis but I still think the video of Giga Shanghai had a lot more new info than was understood. Since my last post, I subsequently learned that some of what I had thought was new had already been shown in a couple recent interviews there. It's still not clear to me whether this was actually signaled intentionally with silly numbers and memes or not, but I think this was the biggest news since AI Day.

The highlights, in my opinion, were:

• No inventory warehouse
  • This had already been discussed in an interview a year ago but the 12/9 video showed more, and this is the biggest deal of them all because of:
    • The build quality (i.e. manufacturing process reliability) and supply chain reliability that must have been achieved to get this to work in the first place
    • The implications on cost, flexibility/agility, and rate of innovation
  • New info: About 2,000 trucks per day across 97 bays = Avg of 1 container every 70 minutes at each bay.
    • About as perfect flow as could be achieved; next one arrives shortly after the previous one leaves

• Multistory automated logistics taking full advantage of vertical dimension
  • Also had been discussed previously but much more shown on 12/9
  • Basically what was attempted--and failed--for original Model 3 ramp in Fremont
    • Designing factory more like a computer processor, as Elon has mentioned as goal many times
  • Improve volumetric efficiency
    • Key metric = Value added per cubic meter per day
  • Enables extensive system of feederlines that can easily be rearranged quickly
    • Helps with flexibility/agility in case a more optimal layout is invented or production steps are added or eliminated later on
  • Improves safety for people by eliminating most of the need for forklifts

• Stamping, Welding, Painting and Final Assembly combined into one unified shop

 

[Krugerrand]

Please don't take a single sentence out of a paragraph, removed from context and argue against it.

I said: "Look, you and I think Tesla is underpriced, but that doesn’t mean the market does. You proposed combining everything into one giant public company. What you and I think it is worth is meaningless, as we don’t have $1T hanging around to invest in it. People already have a hard time valuing a pretty straight forward auto manufacturer. Combine in a bunch of speculative investments (and a failing social media company!) and it won’t get any better."

So I was talking about the stock market in aggregate as "people". What I was saying is that the stock market isn't valuing Tesla correctly according to long term investors - we all think Tesla is worth more. Combining a bunch of disparate companies under one umbrella will make this situation worse.

I didn’t take it out of context. The market is controlled by a handful of powerful people. Those few tell a larger group of people directly underneath them what’s going to happen and that group of people dictate the narratives, the options market, the sentiment et al and spread the word as it were.

*We* are at their mercy. Many of us believe the bs they spread and are influenced to buy or sell according to the stories they tell us. A few of us have figured out how to beat them.

The Market is not *us*. The Market is not the *people*. If The Market was *us*, Tesla would be properly valued because *we* actually know how to value it.

 

[MP3Mike]

Maybe I missed it but I don't see that Elon's interview on the Full Send podcast was posted yet:

Elon doesn't show up in it until ~17 minutes in.

warning: it is over three hours long.

 

[CorneliusXX]

I think you have presented a very good view of the positives, but for your 'optimistic' view of history.
Belaboring these points probably isn't the finest use of weekend passes on TMC. I'll only say that in good times Captives do very well. In bad times they are normally bailed out by the parent (normally the captives are contractually direct parent obligations anyway. Apart from subvention of interest rates, credit risk and/or resale risk few captives really are profitable. They almost never look that way because of all the parental support.

There are amazing cases that never reach public disclosure and a tiny handful that do. It takes a major catastrophe like GMAC venture in US mortgages (buying Nationwide destroyed them ) to be public:

Feds throw GMAC $6 billion lifeline - Dec. 29, 2008

money.cnn.com

There is a very long list of failures and bailouts in quite a few countries. Most, as I mentioned, don't become public. Almost always the buyers of their securitized assets do not lose money. Why? All of them have clauses that require the originator to substitute good paper for bad and overcollaterize anyway plus only allowing aged paper in the pool anyway. Those things do create an illusion of low risk.

I agree that I don't want to get bogged down in the detail for casual weekend discussion, but a $6b loss during the GFC is nothing compared to the profitability and market expansion GMAC would have provided over the previous century - and losses were predominantly due to poor underwriting standards, poor structuring and market dislocations - not a fundamentally poor business model. The bank I work for picked up portfolios of Ford and GMAC auto loans in the GFC and did quite well out of them. The losses weren't particularly egregious even with the above mentioned issues. Disciplined captive auto finance is very lucrative.

The securitisation comments fall into the same bucket. generally speaking investors give many billions of dollars to captive finance arms for miniscule interest rates. Only if underwriting standards drop do any of the protections mentioned come in to play.

 

[keydiver]

I don't know if I'd classify the ramp as going pretty well. It's ok, fine, etc. but it's certainly behind the original schedule now and there's 6-12 months to get volume production up to speed before it starts to have an impact on growth expectations - which again is fine but nothing to write home about.

Am I remembering wrong? I thought Elon said at the Battery Day that mass production for 4680 was targeted for EOY 2022? It might be behind OUR schedule, but I seem to remember that I thought their target was rather conservative, but it turns out now looking correct.

 

[Cosmacelf]

Maybe I missed it but I don't see that Elon's interview on the Full Send podcast was posted yet:

Elon doesn't show up in it until ~17 minutes in.

warning: it is over three hours long.

Maybe this belongs in the Elon Musk thread, but I’ve been listening to it here and there when I’m driving or have extra time.

The interviewers, while not precisely idiots, are certainly ignorant. Not only of pretty much everything Elon does, but ignorant of much of how anything in the world works save their knowledge of current culture.

I understand why Elon does these interviews. These videos have huge reach and not only educate the masses, but also act as a giant free brand marketing exercise, worth, collectively, billions of dollars.

But I honestly don’t know if I’d be able to hang with these guys for three hours without betraying my exasperation on their general low intelligence and lack of knowledge. It’s actually quite impressive how Elon rolls with the punches here, deflecting asinine questions into jokes while sprinkling in wisdom and knowledge.

Sorry for the grumpy old man post, I just had to get that off my chest.

 

[Cosmacelf]

Am I remembering wrong? I thought Elon said at the Battery Day that mass production for 4680 was targeted for EOY 2022? It might be behind OUR schedule, but I seem to remember that I thought their target was rather conservative, but it turns out now looking correct.

I do not recall myself, but Jordan of the Limiting Factor does. His latest video dissecting the 2Q earnings call has him point out that Tesla is significantly behind their originally promised schedule.

According to his video, the battery day presentation projected 100 GWh of 4680 produced in 2022. They revised that to a 100 GWh run rate by end of 2022. And now they project a 4 GWh run rate by end of 2022. Start video at 13:16 to hear this.

 

[jerry33]

Maybe this belongs in the Elon Musk thread, but I’ve been listening to it here and there when I’m driving or have extra time.

The interviewers, while not precisely idiots, are certainly ignorant. Not only of pretty much everything Elon does, but ignorant of much of how anything in the world works save their knowledge of current culture.

I understand why Elon does these interviews. These videos have huge reach and not only educate the masses, but also act as a giant free brand marketing exercise, worth, collectively, billions of dollars.

But I honestly don’t know if I’d be able to hang with these guys for three hours without betraying my exasperation on their general low intelligence and lack of knowledge. It’s actually quite impressive how Elon rolls with the punches here, deflecting asinine questions into jokes while sprinkling in wisdom and knowledge.

Sorry for the grumpy old man post, I just had to get that off my chest.

It’s possible that the interviewers ask those kinds of questions because that’s the level of their audience and better questions would be lost on them [the audience].

 

[Cosmacelf]

It’s possible that the interviewers ask those kinds of questions because that’s the level of their audience and better questions would be lost on them [the audience].

Did you listen to the video? I don’t get that vibe…

 

[CorneliusXX]

Am I remembering wrong? I thought Elon said at the Battery Day that mass production for 4680 was targeted for EOY 2022? It might be behind OUR schedule, but I seem to remember that I thought their target was rather conservative, but it turns out now looking correct.

I went back and had a quick look at the youtube transcript for battery day and the below quotes are the best I could find on timelines. 18 months to start realising and 3 years to fully realise. 18 months from Battery day was April this year. I'd argue they are behind on this given only the Kato Rd lines seem to be up and running and the current iteration of cells does not include much of the tech tesla touted (according the the limiting factor's cell video). But perhaps I am being a little harsh.

so [Music] yeah it's a video of uh
50:39
some of what's going on in the plan
50:47
um now i mean to be clear it will take about a year to reach the 10 gigawatt hour capacity
50:52
uh so this is important to appreciate like when you build a factory there's a certain capacity that you design to
50:58
and then uh it takes some period of time to actually achieve that capacity so i would say
51:04
it's probably about a year before we get to the 10 hour annualized rate uh with the with
51:10
the pilot plant and this is just a pilot plant uh the the actual production plants will be more on the order of
51:16
uh you know maybe 200 gigawatt hours maybe more over time and

who would have thought yeah just happened to happen out that way
1:28:24
i mean 0.420 of course um yeah so what what this
1:28:32
uh enables uh us to do is achieve a new trajectory in the reduction of of uh cell cost and um now to be clear
1:28:40
it will take us probably a year to 18 months to start realizing
1:28:45
these uh these advantages and probably to fully realize the advantages probably it's about three years or thereabouts
1:28:53
so um you know it's it's not like uh if we could do this instantly we would um but
1:28:59
it's it's really um i think what this bodes for it's just really bodes well for the future and means that

 

[ZeApelido]

Maybe this belongs in the Elon Musk thread, but I’ve been listening to it here and there when I’m driving or have extra time.

The interviewers, while not precisely idiots, are certainly ignorant. Not only of pretty much everything Elon does, but ignorant of much of how anything in the world works save their knowledge of current culture.

I understand why Elon does these interviews. These videos have huge reach and not only educate the masses, but also act as a giant free brand marketing exercise, worth, collectively, billions of dollars.

But I honestly don’t know if I’d be able to hang with these guys for three hours without betraying my exasperation on their general low intelligence and lack of knowledge. It’s actually quite impressive how Elon rolls with the punches here, deflecting asinine questions into jokes while sprinkling in wisdom and knowledge.

Sorry for the grumpy old man post, I just had to get that off my chest.

It’s okay. That’s how I feel when I’m viewing everyone else’s posts in this thread.

 

[betstarship]

It’s okay. That’s how I feel when I’m viewing everyone else’s posts in this thread.

Hey - my mom says I'm a smart person

Also, Tesla heat pumps would be a big win for the environment - actually good article on everything about it found so far:

Elon Musk May Have a Solution Against Heat Waves and Allergies - TheStreet

The richest man in the world is currently working on new products.

www.thestreet.com

 

[MC3OZ]

With X.com it seems more likely to me that Elon is intending to build up from PayPal, rather than down from retail banking.

The next step after PayPal is a Visa/Mastercard credit card which typically backs the PayPal account.

Each customer makes a monthly settlement with their Visa/Mastercard account via the regular banking system.

Visa/Mastercard make money via charging customers interest on monthly balances, and by charging merchants a fee.
To take market share from Visa/Mastercard X.com would need to charge lower interest rates and lower fees.

If X.com has a full banking license, customers can get their salary or customer payments deposited into a X.com bank account.

For a merchant the X.com account can settle periodically with an external bank account if required.

Property and Business loans require staff, specialist skills and a lot of paperwork, they are higher risk transactions for large sums of money and exposed the the economic cycle.

Any loans for Tesla products, cars, solar, Powerwall are one step up from credit card loans, and repossession of the car is always possible,

Exposure to any one customer can be limited by setting a credit limit, or denying a loan, if necessary.

Where Twitter might come in useful is:-

1. Having a team of software developers and some equipment that can be repurposed to support this task,
2. Having a pool of users who can be displayed advertisements/options for X.com services as needed.

My hunch now is most of Elon's interest in Twitter is due to the potential of 2. above. Elon doesn't like to pay others for advertising, but advertising on a platform he owns is a completely different matter.

Elon may or may not be intending to extend X.com to crypto currencies providing a way for crypto transactions to handled seamlessly. There are some questions as to how that could work, but if he is intending to do it, Elon would have a plan.

 

[Electroman]

Interesting did anyone ask a question to Musk on where they are on the 4680 mass production ramp and how the DBE process is scaling?

 

[ZsoZso]

It’s okay. That’s how I feel when I’m viewing everyone else’s posts in this thread.

You know, they say if you feel like you are the smartest person in the room, then you are probably in the wrong room!

 

[Electroman]

I don't understand why people directly link x.com to Twitter for some low value advts, based on Elon's comments. The way I understood his comments was - he had a vision to take x.com to a level that the other partners did not have or agree with him. So the usefulness of x.com fell way short. He thinks he can bring Twitter to a level that no one else has the vision or the wherewithal to do that, and he wants to get Twitter there by full ownership.

X.com could have been the mother of all money transaction exchange out there, but it failed and it got fragmented into Paypal, Apple Pay, Zelle, Venmo, Google Pay etc.. Similarly he wants to unlock the power of Twitter by making it the mother of all public square communication platform by getting to a much wider audience and being inclusive.

 

[Captkerosene]

With X.com it seems more likely to me that Elon is intending to build up from PayPal, rather than down from retail banking.

The next step after PayPal is a Visa/Mastercard credit card which typically backs the PayPal account.

Each customer makes a monthly settlement with their Visa/Mastercard account via the regular banking system.

Visa/Mastercard make money via charging customers interest on monthly balances, and by charging merchants a fee.
To take market share from Visa/Mastercard X.com would need to charge lower interest rates and lower fees.

If X.com has a full banking license, customers can get their salary or customer payments deposited into a X.com bank account.

For a merchant the X.com account can settle periodically with an external bank account if required.

Property and Business loans require staff, specialist skills and a lot of paperwork, they are higher risk transactions for large sums of money and exposed the the economic cycle.

Any loans for Tesla products, cars, solar, Powerwall are one step up from credit card loans, and repossession of the car is always possible,

Exposure to any one customer can be limited by setting a credit limit, or denying a loan, if necessary.

Where Twitter might come in useful is:-

1. Having a team of software developers and some equipment that can be repurposed to support this task,
2. Having a pool of users who can be displayed advertisements/options for X.com services as needed.

My hunch now is most of Elon's interest in Twitter is due to the potential of 2. above. Elon doesn't like to pay others for advertising, but advertising on a platform he owns is a completely different matter.

Elon may or may not be intending to extend X.com to crypto currencies providing a way for crypto transactions to handled seamlessly. There are some questions as to how that could work, but if he is intending to do it, Elon would have a plan.

Elon needs Trillions to colonize Mars. The world market for money is ripe for a neutral crypto to replace currencies where governments have abused their money issuing privileges. I could see Elon making those Trillions in this space with an internet/Twitter based money network. I still want the Twitter deal to go through.