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

[Artful Dodger]

Seem to be getting some good support at $200. I could very well be wrong, but right around here just feels like the bottom for TSLA. Good time to buy IMO.

I agree. I think some very large whales are hooving up plankton shares like a whale shark. And I sincerly hope that Tesla Inc. is in that pod of whales.

EDIT: ~45.9M* shares traded by 11:00 ET (that's alot*)

Treasury shares FTW!

 

[Todd Burch]

Price Cut = Demand Problem
Price Increase = Demand Problem

Just copy and paste that for the rest of our lives.

Just remember: While everyone else is inventing reasons why Tesla's going to fail, Tesla will just keep pulling ahead.

 

[JRP3]

It would be great if Elon is selling right now. The movement of the stock (except for the low opening) is in tandem with macros, so it would mean the market is able to absorb the shares without the bottom falling out.

Potentially he's now sold everything he would need to.

 

[InTheMiddle]

Question - to what degree can I start conjecturing on this board the primary reason for the May 2023 annual meeting date and the announcement for it coming out at this time? Or is there a better place for such a conjecture to be discussed?

 

[MP3Mike]

I think we can all agree that as of now, Tesla doesn't need to advertise in the traditional sense to sell cars. They will sell every car they make, at least for a good long while. But in light of the price reductions in China, I do think it's worth asking whether advertising would allow Tesla to sell those same cars without the need to lower the price. As their business ramps, a $1000 price cut to help sell the next 1 million cars (I'm making up numbers) would remove $1 billion from the bottom line. It would seem that some degree of limited advertising could help move those cars without the need to drop the price, and would cost a lot less than $1 billion.

It seems likely that the main purpose of the price drop was to allow the models to qualify for the subsidy, making the vehicles more affordable for their customers. No amount of advertising would accomplish that...

 

[Atomsla]

Question - to what degree can I start conjecturing on this board the primary reason for the May 2023 annual meeting date and the announcement for it coming out at this time? Or is there a better place for such a conjecture to be discussed?

Nono, this is most certainly the place for it.

 

[DarthPierce]

Question - to what degree can I start conjecturing on this board the primary reason for the May 2023 annual meeting date and the announcement for it coming out at this time? Or is there a better place for such a conjecture to be discussed?

Seems on topic to me.

Hopefully it's to correspond with customer deliveries of Cybertruck. (Maybe a schedule for roadster? Nah)

Hopefully the early deadline for shareholder 'issues' means I spend less time listing to rambling garbage during the meeting.

 

[unk45]

I'm going to bring up the issue of advertising again (with the understanding of the it's been done many times before and people generally have strong feelings about it). But hear me out.

... It would seem that some degree of limited advertising could help move those cars without the need to drop the price, and would cost a lot less than $1 billion.

Now I understand that undercutting the "competition" has value... .

But this could be another lever that could cost much less than a price reduction..

There are a few misconceptions here, not in the context of opinion differing but in the context of factual comparisons.

First, the assertion that advertising costs less than do other alternatives. Not true!

Second, the notion that 'undercutting the competitions' on price is valuable. That si manifestly untrue when the product and positioning are of a premium product. There are copious proofs of that in the world from clothing to cars and airplanes. Different products in different positions do have different prices, but premium ones diminish value by cheaper prices. (Don't take my word. Look up advanced marketing texts. Conventional wisdom is often in error. Obvious case: Apple vs Android (any brand). Price is a feature, so there are entry models that are cheaper but still premium to competition.

Third, the idea that advertising is cheaper than a price reduction. The very price reduction generates it's own benefits, but only because it is linked to the notion fo wider and speedier availability.

Fourth, the very presence of an ordering process vs easy off-the-shelf access tends to increase perceived desirability.

Fifth, and by far the most important. Tesla shares with very few products the understanding of 21st century buyer behavior. The very fact of internet presence has revolutionized purchasing behavior, with Amazon and Alibaba the most famous instigators.

Tesla generates enormous attention and intentions to buy with packaging issues that attract droves and entirely invisible to non-targets. Games, farts and Easter Eggs are massively influential to their targets, visible to Boomers like me. Tesla also cultivates massive favorable attention by providing access to influencers and promoters while making money from them. A stellar example is US. Cultivating retail investors is an obvious but nearly invisible way to push word-of-mouth. There are numerous other examples, too many to list, but just one proves the point. Tesla establishes large gatherings, invitation only, to sell the public on their manufacturing, packaging and distribution superiority. Tesla makes regular invitation only presentations for new products, technical excellence and innovations. These tend to be positioned as recruiting events, so the language itself is often not understood by most observers. Then there are those periodic owner loyalty program offerings, not often, but often enough to keep owners talking about them even when they are not longer active.

The last paragraph describes a Positioning, Promotion and Pricing process that is strictly 21st century. Placement and Distribution, too, with direct sales only, describe marketing that ould not be done thirty years ago.

When anybody advocates advertising they completely misunderstand the Tesla business model. We may see a bit of traditional advertising if institutional investors become more important. Most of them, like securities analysts, are quite clueless. Some industrial companies do advertising when dealing with politicians, regulators and those investor types, precisely to influence them. That is often seen in the Washington DC area, and other capitols around the world. So far Tesla hasn't needed that, but with octogenarian political leaders some of that may be needed soon.

For sales, no.

 

[SOULPEDL]

I agree. I think some very large whales are hooving up plancton shares like a whale shark. And I sincerly hope that Tesla Inc. is in that pod of whales.

EDIT: ~45.9M* shares traded by 11:00 ET (that's alot*)

Treasury shares FTW!

Check out Volumes! About to cross 50M already.

 

[NicoV]

Correct. Tesla isn’t a short term profit maximizing company, it is a long term profit maximizing company. It would rather have less profit in the short term if that meant bigger long term market share/revenues. The whole company is organized around this principle.

Except for ‘the wave’ then.

 

[Artful Dodger]

Except for ‘the wave’ then.

Haha, the wave wasn't about maximizing profit, it was about maximizing chances of avoiding bankwupcy...

Now Tesla has bags of cash, and is printing more with 4 separate money printers. It's going be okay.

Cheers!

 

[ZachF]

Some Chinese stocks today:

-11.4% Tencent
-14.6% Alibaba
-14.9% Xpeng
-16.0% Baidu
-18.2% NIO
-28.3% Pinduoduo

 

[SOULPEDL]

Here's where that 200 SP came from.

Spoiler: 200 Put Vol nearly 100K.

 

[StealthP3D]

I'm going to bring up the issue of advertising again (with the understanding of the it's been done many times before and people generally have strong feelings about it). But hear me out.

I think we can all agree that as of now, Tesla doesn't need to advertise in the traditional sense to sell cars. They will sell every car they make, at least for a good long while. But in light of the price reductions in China, I do think it's worth asking whether advertising would allow Tesla to sell those same cars without the need to lower the price. As their business ramps, a $1000 price cut to help sell the next 1 million cars (I'm making up numbers) would remove $1 billion from the bottom line. It would seem that some degree of limited advertising could help move those cars without the need to drop the price, and would cost a lot less than $1 billion.

Now I understand that undercutting the "competition" has value. And that the IRA will have some impacts on price/cost in the US. So the dynamics are complicated. But this could be another lever that could cost much less than a price reduction, and will have the added benefit of educating people about EVs in general, and Tesla in particular. I'm still stunned by the ignorance out there. But I view those as buyers who just haven't been educated yet.

You are correct. The misguided idea that advertising would benefit Tesla and the mission has been presented many times before.

Where you really go off the rails is to suggest that advertising would have the "added benefit of educating people about EV's in general, and Tesla in particular." Using customer money to educate Tesla customers is just crazy talk because most people assume advertisements are biased and are the least trustworthy source of information about a product or service. People trust family, friends, co-workers and neighbors who actually own and drive a Tesla every day. And those people are growing 50% compounded annually. No other car company has a salesforce growing that quickly.

The one thing that sets Tesla apart from all legacy auto manufacturers is that you have never seen Tesla spend a wad of customer's cash to convince them to buy their products using slick ads developed by marketing experts. This is an important differentiator between Tesla and the rest. The human subconscious has evolved over millions of years to categorize things without the individual even being aware of it. It's a powerful advantage for Tesla to be different from the rest and, once that is lost, it can never be recovered. Your subconscious mind knows who has to pimp their cars, and who doesn't. You cannot undo an advertising campaign. Not only is the money down the toilet, but the damage is also lasting and irreversible. I want Tesla to remain different from the rest.

 

[Krugerrand]

Hey, @Krugerrand
fyi
you were warned

?

Read my lips - I do not care nor have I ever cared. I have never predicted nor tried to predict SP movements. I have never said or implied the SP wouldn’t revisit certain numbers. Never.

Move along.

 

[Tachyon]

Word of the day, rather , the Quarter ./s

“ Unrecoverable”

I guess we will soon see merchandise too.

 

[mongo]

Here's where that 200 SP came from.

Spoiler: 200 Put Vol nearly 100K.

View attachment 867019

That's a volume chart, not open interest.[already known]
People trade volatility around stock price (and as insurance in the case of puts on down days).
There were a lot of 200 puts for this week though.

 

[Xepa777]

You are correct. The misguided idea that advertising would benefit Tesla and the mission has been presented many times before.

Where you really go off the rails is to suggest that advertising would have the "added benefit of educating people about EV's in general, and Tesla in particular." Using customer money to educate Tesla customers is just crazy talk because most people assume advertisements are biased and are the least trustworthy source of information about a product or service. People trust family, friends, co-workers and neighbors who actually own and drive a Tesla every day. And those people are growing 50% compounded annually. No other car company has a salesforce growing that quickly.

The one thing that sets Tesla apart from all legacy auto manufacturers is that you have never seen Tesla spend a wad of customer's cash to convince them to buy their products using slick ads developed by marketing experts. This is an important differentiator between Tesla and the rest. The human subconscious has evolved over millions of years to categorize things without the individual even being aware of it. It's a powerful advantage for Tesla to be different from the rest and, once that is lost, it can never be recovered. Your subconscious mind knows who has to pimp their cars, and who doesn't. You cannot undo an advertising campaign. Not only is the money down the toilet, but the damage is also lasting and irreversible. I want Tesla to remain different from the rest.

....you know Tesla runs ads and does marketing partnerships in China right?

 

[insaneoctane]

I guess I am a little baffled by the "negative" reaction to Tesla adjusting China pricing. The GMs have not only been industry leading, but they've caused many to compare Tesla to software companies (!). Well today, Tesla is selling hardware. Software might be the future, but look at the balance sheet, it's hardware today. So, if Tesla adjusts the price knob a little, to firm/increase demand, and GM stays industry leading, what's "negative"? The strength to sell all your product at great GMs is something every competitor would envy. Seems like the goal posts have been moved only for Tesla. Are there really any honest analysts that think that Tesla's GMs can only go up....indefinitely? Sure, when FSD is non-beta and RTs are released, there will be another big GM step change in Tesla's future...

 

[KBF]

Investors are seeing what Xi pulled this weekend to be some kind of a power move which means hawkish over the Taiwan situation. TSMC is down 6% and over 4% premarket. If the Taiwan thing happens, Chinese made cars will not be sellable overseas.

I sold some AAPL (and AMZN) today, picked up more TSLA. One reason: while China shenanigans will disrupt everyone short term, AAPL is very exposed/reliant on Chinese manufacturing; TSLA is capable of building factories anywhere they want, and when a supplier has fallen through, they've proven they can adapt and improvise - find a new supplier, make it themselves, or reengineer. I'm glad they already have factories in disparate parts of the globe. Hopefully that trend continues.

Though I think that the best investments we can all make is taking steps toward sustainable living: reduce dependence on grids, multinational corps, and governments where logical/possible. For me, that looks like building a net zero (off-grid capable) home in a temperate region with access to well water and lumber - that will continue to pay dividends (reduced expenses and energy price volatility) in most (near)worst case scenarios... For others, the focus may be different depending on your context.

Cheers to sustainability!