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

[traxila]

Leasing allows any EV to get the IRA credit regardless of price and income limits including Model 3, Y, S and X.

Biden admin quietly adds workaround, making pricey sports cars eligible for EV tax credits

The Biden administration released guidance Thursday showing that any electric vehicle would still be eligible for tax credits if leased despite the strict requirements for purchases.

www.foxbusiness.com

Wow. What a giveaway to the dealers. They are going to be scamming harder than ever and very few consumers will even begin to fathom how badly they are taken.

I feel like Tesla is suddenly about to become a financing business like the OEMs.

Well, rising interest rates and impending recession are not a bad time to value debt and issue notes when you have none to begin with.

And if all the other OEMs make their actual money profit off of financing, Tesla will spike its 'earnings' potential for WS.

 

[Stretch2727]

Wow. What a giveaway to the dealers. They are going to be scamming harder than ever and very few consumers will even begin to fathom how badly they are taken.

I feel like Tesla is suddenly about to become a financing business like the OEMs.

Well, rising interest rates and impending recession are not a bad time to value debt and issue notes when you have none to begin with.

And if all the other OEMs make their actual money profit off of financing, Tesla will spike its 'earnings' potential for WS.

Actually the prior tax credit allowed it to be baked into the lease, greatly reducing the payment. Some of my early EV's were leased under $200 a month due to the tax credit. I do agree the dealers will try to scam consumers that are not knowledgeable.

That's why I don't understand all the discussion on suspension and seats etc. Tesla will just lease the cars over the price limit. Rough calculation of a payment of $500 month on a LR Model Y versus $1000 a month if you finance. You can buy the car at the end of the lease if they write the contract this way.

 

[heltok]

Seeing lots of people upset about IRA and 55k Model Y. Imo this is premature. Let's wait and see. Until then remember:

1. IRA is a massive win for Tesla and other EV makers. Tesla even more so since the previous bonus excluded Tesla
2. Tesla can just add third row to temporary include the Model Y in the 80k
3. Model Y probably costs around the same as Model 3 to make. They could lower the price and kill the market for everyone else. Software unlock acceleration and range. Also it's for the USA, takerate for FSD will soon skyrocket.
4. The rules will probably be modified soon
5. Batteries made in US will be subsidized also, Tesla is in a great position to capitalize on this for the next decade

 

[Singuy]

Actually the prior tax credit allowed it to be baked into the lease, greatly reducing the payment. Some of early EV's were leased under $200 a month due to the tax credit. I do agree the dealers will try to scam consumers that are not knowledgeable.

That's why I don't understand all the discussion on suspension and seats etc. Tesla will just lease the cars over the price limit. Rough calculation of a payment of $500 month on a LR Model Y versus $1000 a month if you finance. You can buy the car at the end of the lease if they write the contract this way.

Leasing is bad for financials. You are pretty much making 5-6% on the money that is deprecating until you sell the rest via 2nd hand to the original lease holder or a new customer. So this puts a delay on revenue recognition while increasing liabilities.

 

[Big Time]

Happy new years TMC. I’m sure that 2023 will be great. Let’s get to P&D report!

 

[Stretch2727]

Leasing is bad for financials. You are pretty much making 5-6% on the money that is deprecating until you sell the rest via 2nd hand to the original lease holder or a new customer. So this puts a delay on revenue recognition while increasing liabilities.

Probably more than they are making on the huge cash reserve they have today.

Also, I believe there is a pretty good market to sell the leases to banks to get the cash back on the balance sheet.

Let's see where this goes. I do believe if the government continues on this path you are going to see most of the higher priced EV's aquired as leases. It's just too big to ignore.

 

[traxila]

Leasing is bad for financials. You are pretty much making 5-6% on the money that is deprecating until you sell the rest via 2nd hand to the original lease holder or a new customer. So this puts a delay on revenue recognition while increasing liabilities.

Yes.

But if this is what Tesla must do right now then do it. Get the cars on the road.

And again, better to value debt now than a year ago.

 

[Favguy]

Happy new years TMC. I’m sure that 2023 will be great. Let’s get to P&D report!

Can't wait, when's it due out, is it tomorrow?

 

[Singuy]

Yes.

But if this is what Tesla must do right now then do it. Get the cars on the road.

And again, better to value debt now than a year ago.

Well, there's a SR Model Y anyways, that can replace the LR while LR only comes with 7 seats.

 

[ByeByeJohnny]

If both the EV and battery pack market doubles every year for the next 10 years as many believe the amount payed out from the IRA will be so high it'll create inflation by itself. It won't be billions. It'll be trillions.

Something will give long before the IRA get to its supposed endpoint in 2032.

 

[betstarship]

Yes.

But if this is what Tesla must do right now then do it. Get the cars on the road.

And again, better to value debt now than a year ago.

Tesla's word of mouth strategy in focus: Why Elon Musk's owner-based initiative works

Tesla’s (NASDAQ:TSLA) avoidance of traditional advertising initiatives is one of the most recognizable things about the company, yet it is one that has been questioned several times over the years by Wall Street analysts, investors and even avid fans. Yet, despite these questions, CEO Elon...

www.teslarati.com

I hear you on getting cars on the road as quickly and as happily (to the customer) as possible. The word of mouth network effects, that Tesla has utilized successfully for years, should ride the wave from there and let the data speak for itself. No need for advertising ever.

 

[CorneliusXX]

Yes.

But if this is what Tesla must do right now then do it. Get the cars on the road.

And again, better to value debt now than a year ago.

I'd expect Tesla to sell down their leases to keep cash high. Unlikely that Elon would want to burn through the reserves while expecting a recession for the next 18 months.

 

[EVWatcher]

no room for FSD

Guess it’s time for tesla to spin up that financing arm that can give financing to FSD after delivery at auto loan rates. Should be a pretty good financial instrument for them to either keep on the books or bundle to a bank because the COGS, delivery and cost to repossess FSD is …. **** checks notes ***** zero.

 

[Singuy]

If both the EV and battery pack market doubles every year for the next 10 years as many believe the amount payed out from the IRA will be so high it'll create inflation by itself. It won't be billions. It'll be trillions.

Something will give long before the IRA get to its supposed endpoint in 2032.

The amount of money tax payers are giving to Tesla will be used in the next presidential debate. I'm looking at roughly 7 billion.

 

[Prunesquallor]

Hertz increased its fleet of electric rental cars — then, its profits exploded

A key contributor was Hertz’s discovery that electric vehicles are between 50-60 percent cheaper to maintain than gasoline-powered cars.

www.thecooldown.com

Rental car company Hertz is shifting into high gear on the road to electric vehicles (EVs). Already, it has seen a 12% increase in yearly profits as the globe-spanning rental car company accelerates its transition to EVs and lower costs.

The revenue figure is in part explained by corporate demand for rentals provided by Hertz rising to 70% of pre-pandemic levels. But another key contributor was Hertz’ discovery that EVs are between 50-60% cheaper to maintain than gasoline-powered cars.

I'm betting other rental companies will be crunching these numbers. It will be like Semi - companies that see high mileage and actually value lower operating costs will have no choice.

 

[ShareLofty]

The rules will probably be modified soon

Why do you say that? These aren’t proposed regulations, treasury has been working on these for months. I see Tesla fans on Twitter are upset but I don’t see anyone else talking about this

 

[StarFoxisDown!]

Well, there's a SR Model Y anyways, that can replace the LR while LR only comes with 7 seats.

The real question is how much supply does Tesla have of the 3rd row seats. If they have ample supply to just do a SR Y and then LR/P 3rd row, then yeah I see that as the way they go.

 

[thesmokingman]

So here’s the information that I was looking for. Clearance needs to be raised 1.1 inches.

https://twitter.com/x/status/1609641385107533824

Tesla is by far the most nimble automaker maker….wonder how long it will take Tesla to adjust the manufacturing

This is just moronic. Legislation like this is in opposition to the point of adoption.

 

[heltok]

Why do you say that? These aren’t proposed regulations, treasury has been working on these for months. I see Tesla fans on Twitter are upset but I don’t see anyone else talking about this

It does say: https://home.treasury.gov/news/press-releases/jy1179

• FAQs for consumers on the clean vehicle tax credits that will help them better understand how to access the various tax incentives for the purchase of new and used electric vehicles available beginning January 1. These FAQs include a link containing a list of clean vehicles that manufacturers have indicated to the IRS meet the requirements to claim the new clean vehicle tax credit beginning January 1, 2023. This list will be updated over the coming days and weeks so consumers looking to purchase a new clean vehicle in the new year should be sure to check it regularly.

And I assume there will be complaining by lawyers, politicians etc who want to get some small wins here and there. They are stupid, but they do have some [weak] feedback mechanisms.

 

[Knightshade]

If both the EV and battery pack market doubles every year for the next 10 years

You might wanna check your math there