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

[TheTalkingMule]

I get the feeling to folks not on TMC every day this will simply be taken as another record quarter. We'll see soon enough.

It's still an earnings beat in the bag IMO. Just not the massive insane beat we wanted.

 

[SmokyPeat]

Wow, the headlines I'm seeing are far more positive than I was expecting. Quite a lot of "record quarter" mentions!

 

[StarFoxisDown!]

I have 2 big frustrations with Tesla IR right now……

There’s absolutely nothing wrong with ending the wave. In fact it’s invited. But Tesla IR met with analysts multiple times over the past 1-2 months and not once mentioned to them that they’re ending the wave this quarter. Not a peep. Even though they gave many other updates on the status of the business and factories. It’s bizarre that they would not set expectations.

And further if you’re going to surprise analysts and wall st like this with a change in method about how you’re managing your deliveries/production, at least throw your investors a bone and state that you expect to deliver enough volume in Q4 to hit 50% growth for the year.

 

[Singuy]

I have 2 big frustrations with Tesla IR right now……

There’s absolutely nothing wrong with ending the wave. In fact it’s invited. But Tesla IR met with analysts multiple times over the past 1-2 months and not once mentioned them that they’re ending the wave this quarter. Not a peep. Even though they gave many other updates on the status of the business and factories. It’s bizarre that they would not set expectations.

And further if you’re going to surprise analysts and wall st like this with a change in method about how you’re managing your deliveries/production, at least throw your investors a bone and state that you expect to deliver enough volume in Q4 to hit 50% growth for the year.

Knowing Tesla they just did what they saw to be the most advantageous at the time. Covid lock down in China and the Typhoon had executives made the decision fairly recently and most likely not pre-planned months ago. They saw this as the most optimal solution to a short term problem.

 

[GOVA]

I hope I am wrong. but considering the volatility in the market lately and the negativity surrounding the Optimus Robot expect a huge downward move tomorrow (25%?)

Jusr a little tip, stay off Twitter fro a while. It is a depressing cesspool over there at the moment.

So $200 a chair. Got it.

 

[SmokyPeat]

I have 2 big frustrations with Tesla IR right now…

And further if you’re going to surprise analysts and wall st like this with a change in method about how you’re managing your deliveries/production, at least throw your investors a bone and state that you expect to deliver enough volume in Q4 to hit 50% growth for the year.

Isn't that basically what the Reuters article citing the internal projection was for 495k 3&Y deliveries in Q4 did? That was probably leaked intentionally.

 

[SageBrush]

other auto majors have ~70 days of stock

Where ? Certainly not in the dealership lots I drive by.

 

[Todd Burch]

I hope I am wrong. but considering the volatility in the market lately and the negativity surrounding the Optimus Robot expect a huge downward move tomorrow (25%?)

Jusr a little tip, stay off Twitter fro a while. It is a depressing cesspool over there at the moment.

25%? That’s uh, a bit dramatic.

 

[EVNow]

I hope I am wrong. but considering the volatility in the market lately and the negativity surrounding the Optimus Robot expect a huge downward move tomorrow (25%?)

Jusr a little tip, stay off Twitter fro a while. It is a depressing cesspool over there at the moment.

25% ?! I doubt it. Anyway, I sold some 230 puts on Friday … but not 300 calls. So, I guess a miss was to be expected

Still, not expecting the SP to end below 230 on Friday.

 

[MP3Mike]

I have 2 big frustrations with Tesla IR right now……

There’s absolutely nothing wrong with ending the wave. In fact it’s invited. But Tesla IR met with analysts multiple times over the past 1-2 months and not once mentioned to them that they’re ending the wave this quarter. Not a peep. Even though they gave many other updates on the status of the business and factories. It’s bizarre that they would not set expectations

That would be illegal as it was material non-public information until it was formally announced.

 

[Artful Dodger]

Despite missing some deliveries we hade hoped for, the factors above should have a measurable boost in the bottom line. Hopefully they'll begin to make some disclosures, so they can prudently be included in models.

Yeah, it's about $0.10 per share on the difference in inventory in transit: ($60K ASP, +18K Inv vs. Q2, w. 1.31B shares)

(60000*(22000-4000)*0.3)/(3.13*10^9) = $0.10/sh​

... but of course if ASP happened to go up $4K in Q3 v Q2, then it'd be a push.

Paging @The Accountant

 

[StarFoxisDown!]

That would be illegal as it was material non-public information until it was formally announced.

Huh? Tesla has literally given material information to analysts when they host groups of analysts with Martin, head of Tesla IR. They have material information about production rates at each factory. How on Earth you think there’s a difference between that and Tesla saying that they will be exporting from Shanghai in the final month of Sept to end the wave is beyond me

 

[Artful Dodger]

Where ? Certainly not in the dealership lots I drive by.

This is the historic average in recent years (well documented elsewhere). Tesla historically runs with days of inventory while everyone else runs with months. Q3 may be an anomaly, but if this is to be adjusted, it will happen by other auto majors decreasing their production (then blaming it on 'chips').

Cheers!

 

[EVNow]

Huh? Tesla has literally given material information to analysts when they host groups of analysts with Martin, head of Tesla IR. They have material information about production rates at each factory. How on Earth you think there’s a difference between that and Tesla saying that they will be exporting from Shanghai in the final month of Sept to end the wave is beyond me

Yes - I think information given to analysts is considered public, since they will publish it.

 

[MP3Mike]

Huh? Tesla has literally given material information to analysts when they host groups of analysts with Martin, head of Tesla IR. They have material information about production rates at each factory. How on Earth you think there’s a difference between that and Tesla saying that they will be exporting from Shanghai in the final month of Sept to end the wave is beyond me

I haven't heard of them sharing non public information... I've heard that they helped analysts understand information that has already been released.

 

[Gigapress]

So Much Talk of Exponential Growth, But So Few Logarithmic Charts

Exponential growth appears as linear growth on a chart if the vertical axis is converted to log scale. I think this should really be the standard way of presenting Tesla's growth because with this format it's a lot easier to see just how consistent the exponential growth has actually been and also easier to visually extrapolate.

We are now at the 10-year anniversary of Tesla first achieving a feeble resemblance of real volume production for the Model S in Q4 2012, giving the first real glimpse at a future in which EVs might be profitable and triggering TSLA's first bull rally in 2013. That's ~60% annual manufacturing volume growth for a whole decade.

"...it is about the cleanest exponential I've ever seen." - Elon Musk, Q4 2018 Tesla earnings call

This is almost on par with the 70% growth Ford achieved during the fastest portion of the Model T ramp.

The best indicator of future growth is the trend for the 3/Y family, which too has grown at a 60% compound annual rate since Q3 '18 (by which time the majority of Production Hell was finished; the growth rate for 3/Y is much higher if we include the initial three quarters). Most of this growth happened amidst global supply chain problems that substantially shrank production volume for all the other major car manufacturers.

Spoiler: Raw Data in Tables

Tesla Total Production

Quarter	Quarterly Production	TTM Production
Q4 2012	2,750
Q1 2013	4,900
Q2 2013	5,150
Q3 2013	5,500	18,300
Q4 2013	6,587	22,137
Q1 2014	7,535	32422
Q2 2014	8,763	41185
Q3 2014	7,785	48970
Q4 2014	11,627	35,710
Q1 2015	11,160	39,335
Q2 2015	12,807	43,379
Q3 2015	13,091	48,685
Q4 2015	14,037	51,095
Q1 2016	15,510	55,445
Q2 2016	18,345	60,983
Q3 2016	25,185	73,077
Q4 2016	24,882	83,922
Q1 2017	25,418	93,830
Q2 2017	25,708	101,193
Q3 2017	25,336	101,344
Q4 2017	24,565	101,027
Q1 2018	34,494	110,103
Q2 2018	53,339	137,734
Q3 2018	80,142	192,540
Q4 2018	86,555	254,530
Q1 2019	77,138	297,174
Q2 2019	87,048	330,883
Q3 2019	96,155	346,896
Q4 2019	104,891	365,232
Q1 2020	102,672	390,766
Q2 2020	82,272	385,990
Q3 2020	135,036	424,871
Q4 2020	179,757	499,737
Q1 2021	180,338	577,403
Q2 2021	206,421	701,552
Q3 2021	237,823	804,339
Q4 2021	305,840	930,422
Q1 2022	305,407	1,055,491
Q2 2022	258,580	1,107,650
Q3 2022	365,923	1,235,750

(Some of the "production" numbers from early quarters are actually the delivery numbers because Tesla didn't provide production data.)

Tesla 3/Y Production

Q1 2018	9,766
Q2 2018	28,578
Q3 2018	53,239
Q4 2018	61,394
Q1 2019	62,975
Q2 2019	72,531
Q3 2019	79,837
Q4 2019	86,958
Q1 2020	87,282
Q2 2020	75,946
Q3 2020	128,044
Q4 2020	163,660
Q1 2021	180,338
Q2 2021	204,081
Q3 2021	228,882
Q4 2021	292,731
Q1 2022	291,189
Q2 2022	242,169
Q3 2022	345,988

Ford Model T Production

Year	Production
1909	10,666
1910	19,050
1911	34,858
1912	68,773
1913	170,211
1914	202,667
1915	308,162
1916	501,462
1917	735,020

 

[Krugerrand]

I have 2 big frustrations with Tesla IR right now……

There’s absolutely nothing wrong with ending the wave. In fact it’s invited. But Tesla IR met with analysts multiple times over the past 1-2 months and not once mentioned to them that they’re ending the wave this quarter. Not a peep. Even though they gave many other updates on the status of the business and factories. It’s bizarre that they would not set expectations.

And further if you’re going to surprise analysts and wall st like this with a change in method about how you’re managing your deliveries/production, at least throw your investors a bone and state that you expect to deliver enough volume in Q4 to hit 50% growth for the year.

You have NO idea whether Tesla IR mentioned it to analysts or not. They could have mentioned it and the analysts chose not to publicly repeat it, or even chose to ignore since we’ve all heard it before without it happening.

 

[Gigapress]

You have NO idea whether Tesla IR mentioned it to analysts or not. They could have mentioned it and the analysts chose not to publicly repeat it, or even chose to ignore since we’ve all heard it before without it happening.

I think we do have an idea whether Tesla IR mentioned it to analysts, because I'm pretty sure that would be a blatant violation of SEC regulations. I'm not a lawyer but this seems straightforward and it's obvious why such a rule would exist. In line with this expectation, Dave Lee recently spoke with Tesla IR and he said IR told him they can't say anything other than clarifying information that's already public.

SEC.gov | Selective Disclosure and Insider Trading

www.sec.gov

Regulation FD (Fair Disclosure) is a new issuer disclosure rule that addresses selective disclosure. The regulation provides that when an issuer, or person acting on its behalf, discloses material nonpublic information to certain enumerated persons (in general, securities market professionals and holders of the issuer's securities who may well trade on the basis of the information), it must make public disclosure of that information. The timing of the required public disclosure depends on whether the selective disclosure was intentional or non-intentional; for an intentional selective disclosure, the issuer must make public disclosure simultaneously; for a non-intentional disclosure, the issuer must make public disclosure promptly. Under the regulation, the required public disclosure may be made by filing or furnishing a Form 8-K, or by another method or combination of methods that is reasonably designed to effect broad, non-exclusionary distribution of the information to the public.

17 CFR 243 ("Regulation FD")

Whenever an issuer, or any person acting on its behalf, discloses any material nonpublic information regarding that issuer or its securities to any person described in paragraph (b)(1) of this section, the issuer shall make public disclosure of that information as provided in § 243.101(e)

 

[Artful Dodger]

Production is what really matters though- and that was up 20% in Q3 from Q1.

Even Q1 vs Q3 isn't indicative since half of Shanghai capacity was off-line for upgrades ~5 weeks in Q3.

A better comparison will be Jun 2022 vs. Sep 2022 production. We should get those CPCA numbers soon.

Cheers!

 

[TN Mtn Man]

I know it’s the news media and all, but this is the lead story at CNN right now.

Who wants to buy some solar right now? Lots of people in Florida I bet:

I was wondering how solar panels were going to survive a cat-4 hurricane. Frankly I expected most to be destroyed-large, thin, relatively lightweight panels suspended either above ground on a frame or above a roof-in other words lots of big sails. Figured they'd be found a couple counties away. Really glad to see that I was wrong-especially as a TSLA investor. Let alone for the sake of the people dependent on them right now.