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

[BornToFly]

I’m of the opinion that Elon should Tweet, if true, that Tesla margins are not dropping with the price cuts, and that they are just wanting to move the extra production before end of year. The short sellers and FUD creators are materially hurting some of us, and they should be stopped.

TSLA moving to a -10X Beta is not good.

 

[Krugerrand]

Your A little slow today cat.

I know it and realize it now that I’m caught up. Imagine I had more important things to do so far today than to reality check a bunch of anonymous people on this cesspool called The Internet.

Alas, good to know there’s a few other people with their brains in working order. For a second I thought I was on an island instead of a mountain.

 

[MP3Mike]

A backup power system that consists of a Powerpack (or 2-4, depending on the fleet usage) and a generator is the answer. Megapacks needn’t be considered.

I thought Tesla discontinued the Powerpacks, and only makes Powerwalls and Megapacks now.

But really you need a minimum of ~500kWh of storage for charging a Semi, so a Megapacks is what would be appropriate. (Of course, they have "upsized" them so they start at 3.9MWh now, available to output 970kW or 1,927kW. A Megapack, along with the power source, can charge either one or two Semis at a time depending on configuration.)

 

[StarFoxisDown!]

Shanghai produced 197k cars in Q3. Tesla's full capacity run rate from October would extrapolate to 260k for Q4. That puts Q3 at 76% utilization, not "less than 60%" as you keep repeating.

Production doesn't matter in that relation because until the car produced is sold, it doesn't get acknowledge in earnings. Since a material amount of Shanghai production in the final month was NOT included in the deliveries (both because of being on ships, at docks, and wasn't able to be delivered locally by the end of Sept), it's not 76% utilization. More like around 60-65%.

 

[Krugerrand]

That's why it's a question.

Do we honestly think it needs to be asked? Especially, when it can’t be answered correctly with anything but a ‍.

 

[vikings123]

StarFox to whom I was replying was arguing in favor of the board or management combatting daily/weekly demand FUD with more statements about demand strength. To the extent that the market doesn’t believe them, then such frequent reassurances would be even more pointless.

A very good example is Tesla China denying price cut rumors but then we eventually see price cuts. A lot of bulls question why they denied the price cuts in the first place. The point is there's a lot of moving parts when it comes demand and pricing so it's important to be nimble. There will be no end to FUD if Tesla starts providing daily updates.

I wish there were no price cuts but I'm hoping we can absorb any impact to margins. The only way to find out will be to wait for the quarterly earning reports. No amount of PR clarifications from Tesla will help in this regard.

 

[wipster]

responding to FUD just creates more FUD... let quarterly P&D do the talking ...Tesla should not be concerned with individuals options bets

Then the way to do it is not directly reply to the FUD at all, but instead create new articles, posts, etc. that refute the assertations without directly linking it to the FUD and do it ASAP after the FUD appears. Currently the biggest FUD is reduced demand in China, so using Twitter, post an article from Tesla about how sales in China are at an all-time high. Get a good small team of some great speechwriters and make sure the data used is irrefutable so that it can be forwarded as far as the eye can see and we get some positive news for once! It's not expensive, we now have the vehicle, and it's not advertising so let's use it!

 

[Knightshade]

Tesla Denied Retrial Over Black Worker’s Racism Verdict

Tesla Inc. was denied new trial in a suit by a Black former contract worker who was awarded $137 million by a jury that found he faced racist abuse at the electric vehicle maker’s northern California factory.

www.bloomberg.com

 

[StealthP3D]

Shanghai produced 197k cars in Q3. Tesla's full capacity run rate from October would extrapolate to 260k for Q4. That puts Q3 at 76% utilization, not "less than 60%" as you keep repeating.

Utilization refers to the percent realized of the total production capacity of a facility (or facilities) while run rate for October and November is dependent upon execution. Two different things.

 

[StealthP3D]

I’m of the opinion that Elon should Tweet, if true, that Tesla margins are not dropping with the price cuts, and that they are just wanting to move the extra production before end of year. The short sellers and FUD creators are materially hurting some of us, and they should be stopped.

TSLA moving to a -10X Beta is not good.

I'm of the belief that Tesla should keep financials limited to quarterly reports.

The words you wrote are those of someone who has been gambling, not investing for the future.

 

[Nocturnal]

Do we honestly think it needs to be asked? Especially, when it can’t be answered correctly with anything but a ‍.

For some here, nothing is ever enough. I've been 100% or close to 100% invested in TSLA for over 4 years now, own 2 Teslas and have many more on order, spend time with my local Tesla club on various things including delivering cars to customers, own as much Tesla swag as possible, and have spent hundreds of hours debunking FUD and negative Tesla views but despite all of that anything less than "Everything is perfect and 5D chess and don't ask questions" means you get called stupid and derided as weak or not supporting the company.

It's quite something.

 

[wipster]

I’m of the opinion that Elon should Tweet, if true, that Tesla margins are not dropping with the price cuts, and that they are just wanting to move the extra production before end of year. The short sellers and FUD creators are materially hurting some of us, and they should be stopped.

TSLA moving to a -10X Beta is not good.

Agree that it should be tweeted in a fashion, just not by Elon directly. See my post above.

 

[Captkerosene]

Manage the business, not the stock.

Address media misinformation that hurts the brand,
ala China, put to use the newly assemble legal team.

Adopt an investor relation department that addresses FUD
and other issues (ie semi brakes anybody)

An inverted yield curve usually precedes a recession, bottom
line there is little appetite for risk. S curve investing during
a recession is probably put on hold.

I'd have liked the post better if you'd have stopped after the first line.

We have the best media/investor relations and advertising dept in the world ... bar none. Elon Musk. (Not hyperbole.)

 

[Krugerrand]

A very good example is Tesla China denying price cut rumors but then we eventually see price cuts. A lot of bulls question why they denied the price cuts in the first place. The point is there's a lot of moving parts when it comes demand and pricing so it's important to be nimble. There will be no end to FUD if Tesla starts providing daily updates.

I wish there were no price cuts but I'm hoping we can absorb any impact to margins. The only way to find out will be to wait for the quarterly earning reports. No amount of PR clarifications from Tesla will help in this regard.

That’s a valid point, it’s just too bad people forget there’s nothing in business or life that is static. Instead, they lied. And gosh, there haven’t been any price increases either, huh?

 

[Crowded Mind]

Production doesn't matter in that relation because until the car produced is sold, it doesn't get acknowledge in earnings. Since a material amount of Shanghai production in the final month was NOT included in the deliveries (both because of being on ships, at docks, and wasn't able to be delivered locally by the end of Sept), it's not 76% utilization. More like around 60-65%

Your first sentence demonstrates that COGS are tied to the vehicle until it is sold. That should tell you that higher production spreads a portion of the D&A out over more cars if production is higher, therefore yielding a higher gross margin on the cars that were delivered in Q3 than would’ve been recognized with a lower production number.

Even if you want to argue that, 3/Y inventory grew by 21k cars. Even if you assume all that was from Shanghai production, it would mean 176k Shanghai cars delivered which would be 68%. Higher than your new range and well above “less than 60%.”

The utilization point is valid, but if you are going to make a point to correct someone, at least take the time to do the proper math.

 

[UrsS]

StarFox to whom I was replying was arguing in favor of the board or management combatting daily/weekly demand FUD with more statements about demand strength. To the extent that the market doesn’t believe them, then such frequent reassurances would be even more pointless.

Paraphrasing: "If you repeat a lie often and loud enough people will believe it."
Could this apply to the truth/facts as well?

 

[CHGolferJim]

Speaking of the Amazon delivery van. I saw one for the 1st time right outside our house couple nights ago. Was cool to see.

You didn’t chase it down to get a pic, lol?

 

[Captkerosene]

For some here, nothing is ever enough. I've been 100% or close to 100% invested in TSLA for over 4 years now, own 2 Teslas and have many more on order, spend time with my local Tesla club on various things including delivering cars to customers, own as much Tesla swag as possible, and have spent hundreds of hours debunking FUD and negative Tesla views but despite all of that anything less than "Everything is perfect and 5D chess and don't ask questions" means you get called stupid and derided as weak or not supporting the company.

It's quite something.

Many here have options that are expiring soon. Or, even worse, wives looking over their shoulders. Telling 'em to try and relax only makes it worse.

 

[StarFoxisDown!]

Your first sentence demonstrates that COGS are tied to the vehicle until it is sold. That should tell you that higher production spreads the D&A out over more cars if production is higher, therefore yielding a higher gross margin on the cars that were delivered in Q3 than would’ve been recognized with a lower production number.

Even if you want to argue that, 3/Y inventory grew by 21k cars. Even if you assume all that was from Shanghai production, it would mean 176k Shanghai cars delivered which would be 68%. Higher than your new range and well above “less than 60%.”

Based on your expectations of Shanghai only doing 260k......I think they'll do more like 270-275k.

And no, it doesn't "spread" the D&A out over time. D&A doesn't factor in the way COGS does. It's fixed costs.

 

[Krugerrand]

Then the way to do it is not directly reply to the FUD at all, but instead create new articles, posts, etc. that refute the assertations without directly linking it to the FUD and do it ASAP after the FUD appears. Currently the biggest FUD is reduced demand in China, so using Twitter, post an article about how sales in China are at an all-time high. Get a good small team of some great speechwriters and make sure the data used is irrefutable so that it can be forwarded as far as the eye can see and we get some positive news for once! It's not expensive, we now have the vehicle, and it's not advertising so let's use it!

Meh. Too easy for people to say the data is made up and it’s all just a lie. Tesla has been there, done that. They have a blog.

And honestly (that word is funny to me today) mankind has been lying ever since they could communicate with one another. Politely we called it storytelling, fairy tales, fiction. Can anything written or said nowadays be taken as truth? Even in the non-fiction section of the library, lies are written.