Perhaps I've just been battered by the last several years of owning TSLA. However, this feels like pure optimism to me. I would be shocked if Tesla does not update the interiors of S & X sometime soon. But Tesla has a history of shocking me. Bloomberg is meaningless to me at this point. Tesla's announced numbers are what matter. The fact that they produced less than 5k cars per week in Q1 is worse than anything I had imagined or modeled for. I can't even invent a bullish scenario for why this occurred. I've taken some large financial beatings in the past with TSLA, but I have never felt badly about my investment thesis. I feel pretty terrible today. Tesla has a lot of explaining to do.
I think we do a disservice to ourselves and each other when we as a group mock and ridicule longtime investors that express these sentiments. Not everyone here loved Hog, but he was a long time TSLA bull. I was sad and uncomfortable in hearing he sold his position out entirely. For the first time I've been debating taking my (six figure) loss in TSLA and tapping out.
I agree that it's somewhat optimistic. At the same time, being able to afford a six figure loss, while not great, is better than not being able to afford a six figure loss. I would love to be in a position where I could afford a six figure loss. I view any investment in a single company as a risky bet. A low cost diversified option, ala Vanguard, is what I would consider investing to be.
I'm certainly guessing about Tesla, but what they're doing smells to me like improving/adding/updating automation. I've worked as a systems analyst in business process automation for the past 6+ years, and there are two trends that have stood out to me. One is that automating processes tends to be harder, more costly, and take more time than people expect. The second is that when automation is in place, it tends to be more effective people expect it would be.
In terms of what Tesla has done and is doing, I think the tent was a great way to push more high margin cars out the door before the end of 18Q4, but I don't think Tesla's going to lean on it as a concept going forward. The significant drops in the 3's price and introduction of the SR version suggest to me that they've largely been successful at automating and optimizing 3 production.
The layoffs from the S/X production lines in the beginning of the quarter and increase in price suggested to me that Tesla was expecting to reduce the S/X production rates. While it's possible they knew in advance Model S/X sales would drop significantly because demand would drop, I think it's more likely they knew in advance Model S/X sales would drop significantly because production would drop, and the most likely thing I can think of that would contribute to that is updates to the S/X and those production lines by Perbix/Grohmann after they started winding down the work they're doing on the 3 lines.
Last but not least, Bloomberg's raw data suggests Tesla went from ~3k 3s/week to 6k+ 3s/week from January to present, which seems like odd behavior for a company having trouble selling cars. In that case I would expect them to produce more initially and then reduce production as it became obvious that demand was weakening. On the other hand, I would expect a company that was updating/improving their production lines to produce cars in that manner.
Don't get me wrong, demand dropping for Tesla's vehicles could be why they've reduced production, but this doesn't feel like that to me.