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

[MrMoo]

I get that Tesla China wants to mislead more when talking about price cuts as that affect sales. I have zero idea why you want to mislead with production cuts. If the purpose is to protect the stock price, then wouldn't a production cut drop the stock price anyways? And if the "false information" part is about the demand cliff reason, then isn't this a nothing burger?

I'm not sure, TSLA China actually has a PR department and they were probably contacted for comment. They didn't know wtf to say so they said something grey for the time being. It's just not lying. It buys times for maybe sales to come back? I think soon after they "didn't lie" they put in that incentive right?

Never understood the logic to this. Institutions are the ones dumping so they can buy more?

I think Cramer said instituations don't really care what price they sell a stock at. If the fund manager tells his minions to sell the stock they'll dump as much as the manager wants dumped. They don't care its 170. They'll sell it all to get it off the books. If they are wrong and Q4 is a success they'll happily buy back at 220 once the momentum shifts and the company proves itself. It's just how they do business. They have a lot of money and make lots of profit doing other stuff to get the edge over retail. They aren't too fussed and emotional about selling at a loss or catching a rip.

 

[AndrewZ]

I don't understand, hasn't Tesla China already publicly stated they are NOT cutting production? Isn't any talk about production cuts in China simply discussing FUD and not true production cuts?

I mean, have I missed some news in the past day or so about actual production cuts?

Tesla China's response is in the Bloomberg article, a one-word "untrue" with zero elaboration. What that means exactly is anyone's guess.

Maybe they hope to achieve the same production output with a reduced shift, it sounds like these "sources" are likely people working on the factory floor and who are concerned about their personal income from the reduced shift. I don't think they care where the vehicles are going or some of the other stuff suggested here.

But after cutting prices by 10% and then offering further price-reduction incentives, you'd maintain profitability by reducing labour hours spent.

 

[CyberDutchie]

I don't think Elon should Tweet anything, I think Tesla or Tesla IR should be the source of info, Elon can re-Tweet

It would be a very small expense to have a couple of employees tasked with following the daily news and refuting where necessary with facts - it's not just short-term price that's being hammered, but the general sentiment on the stock is very negative along with perception of Tesla as a whole, and both will take time to recover, if they ever do

I wonder at what point the pressure to do something about the stock price depression is growing from inside. For someone who joined last year with stock-based compensation (ESPP) locked in for two years at then price levels of around $400 the current levels must be so demotivating. Elon has often mentioned that salary at Tesla is above industry norms because of the ESPP program. For many who joined in the last two years I wonder how they feel about this program now… they still get to buy shares at 15% discount butcher 2-year lock-in promise must be a huge disappointment.

 

[Drax7]

Tesla Thailand. Looks like they had gathered plenty of interested folks.

Divide by about 35 to get dollar equivalent.

Well these margin loans has like half the interest rates, and rates have come down a bit. So it's

1. Refinancing of current debt

2. Saving millions in interest a year

3. Tesla stock price is low, chance of margin call is lower so it's a risk off move. Elon can actually rescue the stock and end up with 2x as many shares if he were to buy if Tesla tanks another 30% with his spare cash.

Elon buying his own stock back when he has massive compensation packages seems pretty
remote.

 

[mongo]

Ramblings of mongo:

tl;dr; An 18% reduction in shift hours (11.5 to 9.5) doesn't guarantee a reduction in cars produced (ifvreport is true)
A 20% increase in efficiency * 82% build hours = same number of cars (ok 99%, but the last 2 hours are least efficient)

Happy senario: line improvements worked better than expected. Now they need suppliers and shipping to catch up

Spoiler: words

Production capacity is not actual production
Shanghai upgraded the lines in October
Shanghai still matched production Sept-Oct (more or less, hard to find apples to apples)
Shanghai efficiency is still improving

Cars can't be built unless all the parts are available
Cars can't be sold unless they get delivered
Excess inventory and shipping capacity is capital inefficent
It's better to maintain build rate (efficency) and cut hours than slow the line and later need to speed up
Reducing hours is more capital efficient than slowing build rate (in utilities, if not labor costs)

End of year (even more so than typical end of quarter) is a good time to not have extra inventory (books wise)
If there are model year changes, they need to flush/ use up 2022 parts in alignment with the transition date

 

[growler23]

It’s amazing to see how far ahead Tesla is in being able to build and sell* EVs.

No. 2, the Wuling Hongguang Mini EV is a joke (death trap). For these lists they should set an entry barrier with a sales price of at least $7,500 or $10,000. They don’t include electric scooters either, do they?

BYD is the only one that is somewhat keeping up. Good for them, and Warren Buffett I guess.

VW, Ford, Stellantis, is this the best you can do? Wasn’t VW supposed to have overtaken Tesla as EV leader by now?

And what’s GM up to, Mary “leading” Barra?

* In my country we are being bombarded with commercials and ads (tv, radio, newspapers, online) for the Ford Mach-E, Skoda Enyaq, KIA EV6, Peugeot e-208 and Polestar 2. This has been going on for months. That’s a waste of money unless your cars don’t sell themselves.

Things are not that different here in the US. I see TV commercials for those brands of EVs, as well as something that seems relatively new to me: commercials that are just about how great the car company is - with no mention of a specific product. Honda has been running one for months about how they started from bicycles way back in the day, how they've grown, how great they have become, and ends with a picture of the 'future' - a flying (vtol?) car seen only in reflection from a glass skyscraper. This seems to be their answer to EV's and Tesla.
Ford is also now doing this with a "our company is great, our history is great, we are super American so love us" type commercial that covers the decades of their history. Again, shows some of their products but doesn't name or push any one in particular. This seems to be part and parcel of the get-it-out-there-now-no-matter-what-it-costs F150 Lightning. They are paying a ton of money to stay relevant in people's minds as massive change starts to eat away. At least they have an offering to sell, albeit in apparently tiny quantities.

One cannot help but think these two companies are very worried. Can't find a way to make EVs at a profit, so buy lots of marketing instead.

 

[UltradoomY]

What if... and bear with me here...

Tesla Shanghai is running so well currently, that their top engineers and management has spare time to come to the USA and work on making it run even better...

Elon and Franz are currently working on the next generation platform - eluded to by Martin V. and Franz in recent interviews/tweets - in fact they were so excited about it, they had to stop themselves from mentioning more.

Elon, knowing he is Elon - does not want to mention any MNPI inadvertently - so is being tight lipped.

Things we are waiting to actually hear about on the Q4 call -
New Giga (s) - mentioned earlier that they would reveal at the end of the year
Semi ramp
Model 3 upgrades
4680 ramp
Giga Berlin / Austin ramp
FSD progress

Things we are not waiting to hear about -
Demand
Slow downs / production cuts
Buy backs
What Elon had for breakfast

Things are ACTUALLY better than they have ever been for Tesla.

Take a few minutes and listen to a beautiful song from Bob Marley today - 3 little birds.

Should help, when you are backing up the truck to buy more because this is the time.

 

[geometro]

The word “epic” is still ringing in my ears from the last cc and I’m not sure I know what it means anymore.

 

[thx1139]

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

It was night and directly behind us is a new addition to our subdivision. All it has at this time is the road in. No houses yet. It had backed into the start of the road and I could notice the light ring that surrounds the back slide up door. I was like hey that is an Amazon Rivian delivery van. Looked harder and could faintly see the rest of the shape. Then it drove off.

 

[Krugerrand]

I don't think it's been mentioned here, but Emmet Peppers went to the Tesla Semi event and he was prodding around trying to find information about the share buyback (youtube video listed below). It wasn't directly told to him, but he inferred from the answers (and non-answers) he received that Elon is 100% completely fine with the share buyback, as he has stated on Twitter. Thus, as Elon also stated on Twitter, the board is the one that is hesitant to green light the share buyback, but the most interesting thing Emmet inferred from what was said to him was that the reason for the board's hesitancy is because institutional investors are telling the board not to do the share buyback.

If this is true, here are some points I'd like to make:

1. Contrary to the beliefs of many on social media, including here on TMC, the Tesla Board IS actively looking in the best interests of it's shareholders. It just so happens that institutional investors have a much stronger and persuasive voice than retail investors (most likely due to them owning more shares than retail I'm guessing?)
2. Why do institutional investors not want the buyback to happen? There are two possibilities I can think of. The first is that having less cash on hand could be an added risk to the company that institutional investors prefer not to take. The second is that it might be possible that institutional investors are interested in still being able to get shares on the cheap while they're able to.

Note that there are also some other takeaways from the rest of the youtube video related to Cybertruck that I thought were interesting as well, so it's probably worth listening to the whole video. It seems that the Cybertruck project is called 'Project Everest' and Tesla has told it's suppliers to delay 4 months for it's production. This causes Matt to believe that very few cybertrucks will be produced next year, and that Cybertruck production will most begin around Q4.

Absolutely I’d believe WallStreet is against the buyback and absolutely I’d believe that not only have they told Tesla they don’t want it to happen, but that they’ve also made veiled threats if Tesla does it. This is how they operate. They want complete control. They want to know what’s coming from a company and they want that company to follow a predetermined narrative. They hate surprises and they hate when a company isn’t ‘conventional’ in their operations. Especially a company for which the ticker accounts for so much of market options.

WallStreet spent gobs of time ignoring Tesla and Elon. Then they spent gobs of time trying to annihilate Tesla and Elon. Then they spent gobs of time trying to control Tesla and Elon. For much of the time they’ve succeeded and as a result have made insane amounts of money. Additionally, WallStreet’s antics grows dissent amongst retail investors and drives a wedge between the company, the man and retail.

Check your criticisms for Tesla’s board and Elon when it comes to the SP. You have but a fraction of the information and you have no idea how powerful the crooks are and the lengths they’ll go to to make money while screwing you.

 

[Krugerrand]

I don't think Elon should Tweet anything, I think Tesla or Tesla IR should be the source of info, Elon can re-Tweet

It would be a very small expense to have a couple of employees tasked with following the daily news and refuting where necessary with facts - it's not just short-term price that's being hammered, but the general sentiment on the stock is very negative along with perception of Tesla as a whole, and both will take time to recover, if they ever do

I disagreed because this plays into the hands of WallStreet. You’ve taken their bait and you’re spreading their words throughout retail allowing WallStreet to have complete control. And I’m very much against WallStreet. I want them to be crushed.

 

[elasalle]

There are many reasons to be excited about Tesla in the next six to 12 months: Analyst

George Gianarikas of Canaccord Genuity says there are "plenty of things" that can stimulate demand for the company.

www.cnbc.com

 

[Singuy]

What I never expected is the sentiment of Tesla being the lowest point in the last 3 years while the PE is in the 50s and they are delivering almost as many cars in a quarter than all of 2020 combined. Remember every short in the world thought the 500k deliveries for 2020 was a BS number that will never happen.

 

[traxila]

What I never expected is the sentiment of Tesla being the lowest point in the last 3 years while the PE is in the 50s and they are delivering almost as many cars in a quarter than all of 2020 combined. Remember every short in the world thought the 500k deliveries for 2020 was a BS number that will never happen.

They are producing this Quarter more cars out of only GigaShanghai than they did in all of 2018.

 

[Krugerrand]

This is getting ridiculous: shorts drop TSLA premarket everyday on low volume and coordinated FUD, no one (including TSLA IR, BoD, etc) will defend TSLA. We’re getting shorted to oblivion here. I may start selling shares if the hemorrhaging doesn’t stop.

You only partially understand what’s happening. Yes, ridiculous. Yes, coordinated FUD. Yes, getting shorted/manipulated.

The part you don’t understand is what’s happening behind the scenes with BoD, IR and the crooks, and you definitely don’t understand how you’ve been duped into laying blame at the feet of the wrong people. And now you begin to consider selling -

Chalk another win up for WallStreet and one more retail investor that definitely doesn’t make the ‘million smart retail investor shareholders’ list.

 

[ZeApelido]

 

[Unpilot]

Repeat after me...."I will not succumb to the merchants of doubt"

 

[UncaNed]

What I never expected is the sentiment of Tesla being the lowest point in the last 3 years while the PE is in the 50s and they are delivering almost as many cars in a quarter than all of 2020 combined. Remember every short in the world thought the 500k deliveries for 2020 was a BS number that will never happen.

Because it's not the sentiment of Tesla doing this, but rather the sentiment of the macros that we are where we are?

 

[Krugerrand]

Tesla China's response is in the Bloomberg article, a one-word "untrue" with zero elaboration. What that means exactly is anyone's guess.

Maybe they hope to achieve the same production output with a reduced shift, it sounds like these "sources" are likely people working on the factory floor and who are concerned about their personal income from the reduced shift. I don't think they care where the vehicles are going or some of the other stuff suggested here.

But after cutting prices by 10% and then offering further price-reduction incentives, you'd maintain profitability by reducing labour hours spent.

OMG. Do we really have people saying that it’s not enough for a simple response of ‘untrue’ from the source!? We require how many words exactly? 6?

This article from Reuters is false.

Do we require a soliloquy?

The article from Reuters this fine fall morning from an unknown source not familiar with the situation is untrue. We currently have no plans to reduce production by 20% for the month of December. However, we reserve the right to change our minds at any given second based on ever changing information that none of you hyper focused twerps have nor does the unknown source not familiar with the situation. In closing, feel free to sell our stock and purchase shares in a company that refutes media FUD in a manner more to your liking. Have a great day.

 

[Mike Smith]

Musk pledging TSLA shares to retire 12% Twitter debt doesn't increase risk for TSLA since his finances between the two companies are already tied together anyway. It should be viewed as a positive that he's not selling TSLA to retire the debt instead, as it shows he believes TSLA is too cheap.