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

[jhm]

That's a false claim, Tesla never gave the GF3 cell supply contract to Panasonic. Here's the quote from the Q4 conference call:

Colin Langan

"And just as a follow-up. You commented that you expect China to be online by the end of the year, but there's a lot of articles that the battery supplier - you're looking at different battery suppliers. But, I mean, do you have a battery supplier? Because it seems kind of close to when production is supposed to start."

Elon Musk

"Well, there's really three things: the cell, the module and the pack. We will be making the module and the pack. So it's really just a question of cell supply. And we can essentially use any [high density] [ph] 2170 chemistry. And we expect to be a combination of cells produced at our Gigafactory in Nevada and cells produced in Japan and cells produced locally in China. And we feel confident to have a sufficient supply to hit the 3,000 units."​

I.e. on January 30 Elon Musk already disclosed that Shanghai GF3 cell production will be served from GF1 initially, and from local sources of 2170 cell production.

TL;DR: You are just concern trolling.

Hmm, is there any particular reason why Tesla would want to ship cells from Nevada to China? It seems Japan and China would suffice.

 

[Silent Ludicrosy]

I don’t think Elon was watching from the gulfstream this time. Although It looks like Larry Ellison’s gulfstream was in Osaka earlier this week. Panasonic meeting?

 

[Thekiwi]

Why not? It's the standard source for Apple FUD. "We've seen ripples in the supply chain! Apple is doomed!" This has been going on for decades now. And yes, it's always wrong, and everybody falls for it every time. Total rag.

Nikkei excels at taking non-controversial information and spinning it into negative sounding headlines & reports. For instance a lot of their negative Apple articles are merely reporting the drop in production that occurs during their normal annual iPhone production cycle.

 

[Words of HABIT]

So here we are with TSLA, same price as six months ago. Just think of how much better position Tesla is in compared with October 2018.

/

Congratulations to SpaceX and Elon for the successful Falcon Heavy launch today, and retrieving all three booster rockets. Making the impossible possible every day.

SpaceX link to live webcast here: ARABSAT-6A MISSION | SpaceX

I feel so glad to be a part of Tesla and Elon's vision, if only as a passive investor. Keeps getting better everyday.

 

[SebastianR]

Well done SpaceX!

 

[Krugerrand]

I remember the first fire. I remember the 3rd Q (I think it was 2014) ER. I remember there were a few ER's that were quite decent but the stock price went down anyway. But so much is a blur. Wait!! Oh yeah, the falcon wing doors crisis in February 2016!

The suspension of air suspension, the not-a-recall missing/loose seat bolt recall, the OMG missing HP and subsequent panic over battery specifications, the 0-60 is it a rolling or not-a-rolling start, the many introductions of new features not preannounced 6 months in advance - I bought my car yesterday and Tesla ripped me off, the Broder fiasco, heck, the first picture of a Tesla being flatbedded, the drive unit failures, the first child’s finger to get pinched by a Model S door handle, ack!! no cupholders wth?!?

I can go on and on.

 

[UrsS]

Capitalists (Maxwell - Panasonic - Tesla - Elon Musk)
Elon Musk is not building electric cars and battery storage to make money Remember Tesla's mission: "Accelerate the world's transition to sustainable energy." So, if you want to do that, what would you do with Maxwell's innovations and Panasonic - the worlds biggest (I think) battery producer?
I would put the two together as fast as I could. So, the way I understand Elon's world he wants to get the Maxwell technology to Panasonic (and any other battery manufacturer) and have them produce more and cheaper and better batteries as fast as possible.
Neither Tesla nor Musk need, or should start manufacturing batteries in addition to all the other things they 'need' to manufacture because the existing manufacturers (Legacy Automakers) refused to heed the call.
On the other hand, if the battery manufacturers act like the car manufacturers then I'm afraid Elon will have to start manufacturing his own batteries as well (I'm wondering what tweets that will create )
And yes, I'm aware that all this can not happen without everything being somewhat profitable or at minimum self sustaining money wise too Elon uses the capitalist system to attain his goals "Accelerate the world's transition to sustainable energy!"
He only escapes to Mars if he fails

 

[oneday]

He only escapes to Mars if he fails succeeds

FTFY

 

[jhm]

I mean, Tesla puts about ~$10k worth of cell supply into a ~$40k ASP Model 3, on which it gains ~20% margins: $8,000 income generated per unit.

Selling $10k worth of PowerWalls with 20-25% margins will generate $2,000-$2,500 of income.

It's still a very good margin, but my point is that putting cells into a car leverages up the value - so as long as they can Tesla will prefer to put cell into cars, and this is why they reconfigured Tesla Energy cell output last year to feed Model 3 battery packs.

Right. Your numbers suggest that there is about a $7500 opportunity cost to selling $10k worth of Powerwalls. This opportunity is because cell supply is the binding constraint. So under that condition you could raise the price on Powerwalls 75% and eliminate the opportunity cost differential.

So my point is that Powerwalls are substantially underpriced. The fact that people are willing to wait 2 years for them is further evidence that they are severely underpriced. Had Tesla priced them higher, they would still find some wiling buyers, though likely not as many.

As the market heat up, it will be very much a bout price competition. But there is not much virtue in forcing yourself to take a lower price when none of your competitors are anywhere close to matching either.

So we may as well start the bidding high because in a competitive market these prices will be dropping about 20% every year. At that rate, a battery that will go for $10k in 2 years is easily priced at $15,625 today.

 

[oneday]

Do you know what he uncovered?

He found project Maven or Raven before it was reported on Elektrek. And then he said what he just uncovered, that project Maven barely touched the surface of it. And hasn’t given any detail. He suspects we will see something about it at the 22nd event as a one more thing.

Hmm, is there any particular reason why Tesla would want to ship cells from Nevada to China? It seems Japan and China would suffice.

Perhaps GF1 economy of scale is big enough that it would/could be still financially viable to ship cells from GF1. Seems a little crazy to me as well though, especially because that’s about a month of transit.

 

[Artful Dodger]

All else seems trivial when they can do something as amazing as that.

OT

The amazing part is that the 13,200 lb Arabsat-6A could also have been launched by a solo Falcon9 Block 5 booster (latest and greatest version).

That's right, since the contract was tendered for Falcon Heavy to launch this satellite, SpaceX has improved the baseline performance of Falcon 9 so much that it now exceeds the original planned capabilities of Falcon Heavy.

Bonus Factoid: Since Falcon Heavy now also uses Block 5 cores providing so much excess delta-v, the geostationary transfer burn could in fact have been performed by the Falcon 2nd stage. This means the customer's payload did NOT need to include its own booster to reach its assigned orbit.

Indeed, they could have used that payload for additional manouvering thruster propellant, extending the satellite's useful life. Or launched a heavier payload, or multiple payloads.

Amazing, rapid progress from Musk Industries.

Cheers!

Here's the SpaceX livestream on Youtube (launch is at 19:55)

 

[kengchang]

He found project Maven or Raven before it was reported on Elektrek. And then he said what he just uncovered, that project Maven barely touched the surface of it. And hasn’t given any detail. He suspects we will see something about it at the 22nd event as a one more thing.


Perhaps GF1 economy of scale is big enough that it would/could be still financially viable to ship cells from GF1. Seems a little crazy to me as well though, especially because that’s about a month of transit.

Project Raven

Still cheaper than standing up a new production line and supply chain. I mean S/X cells are coming from Japan to Fremont

 

[GeoX750]

It aids TSLA but only costs Tesla, (while production constrained). And long term TSLA will reach true value anyway.

Do you believe Tesla is production constrained in the US ? Certainly not with respect to the S/X. Tesla could advertise and burnish the image of the S/X, rather than letting their marquee models die without a refresh or advertising.

I push Tesla to friends all the time in the Midwest and its a tough sell. You do not see Teslas here like on the coasts. Advertising is very important and effective in creating a brand image (combating FUD) and creating demand with mainstream consumers.

 

[mongo]

I mean, Tesla puts about ~$10k worth of cell supply into a ~$40k ASP Model 3, on which it gains ~20% margins: $8,000 income generated per unit.

Selling $10k worth of PowerWalls with 20-25% margins will generate $2,000-$2,500 of income.

It's still a very good margin, but my point is that putting cells into a car leverages up the value - so as long as they can Tesla will prefer to put cell into cars, and this is why they reconfigured Tesla Energy cell output last year to feed Model 3 battery packs.

One problem with your numbers, $10k worth of cells makes way more than $10k worth of Powerwalls.

Model 3 LR is 80kWh or so, PW is 14kWh ish, so 5:1 ratio. PW lists at $6,700, so 5 of them cost $33,500. Say $2k for electronics and housing each $10k for 5 plus $10k cells, $20k total. That yields $13,500 net. Call it $10k to be conservative and cover manufacturing overhead.

So it's possibly 4-5x your estimate and on par with the 3 profit (assuming no AP or FSD upgrades)

 

[gene]

The suspension of air suspension, the not-a-recall missing/loose seat bolt recall, the OMG missing HP and subsequent panic over battery specifications, the 0-60 is it a rolling or not-a-rolling start, the many introductions of new features not preannounced 6 months in advance - I bought my car yesterday and Tesla ripped me off, the Broder fiasco, heck, the first picture of a Tesla being flatbedded, the drive unit failures, the first child’s finger to get pinched by a Model S door handle, ack!! no cupholders wth?!?

I can go on and on.

Thanks! Wow, I had forgotten all those details. Did you have this stuff written down or do you have that good a memory?

 

[EVNow]

Slide 24 has a breakout

That linked slide has only 16 slides.

 

[anthonyj]

That is for a 2018 inventory car. 2019 P100D with 21 inch wheels is $113k + taxes/fees. A 30K discount for a one year old inventory car with 2K miles is to be expected. Who would buy a one year old car for the price of a 2019? FYI, a 2019 Performance Model S is only $5k cheaper than it was in 2015 when I bought mine, despite what is certainly less expensive to manufacture. So margins are as good or better today than they were 4 years ago.

P100D was like $140k 6 months ago.

 

[JRP3]

And as well, I'm surprised that the ceasing of investment by Panasonic in the GF1 didn't have a bigger effect on the stock.

Because that didn't actually happen?

 

[SunCatcher]

it was so magical to see....this is where science triumphs art!

Science becomes art. A thing of true beauty!

 

[HG Wells]

I've seen the idea floated that somehow if only Tesla created ride-share people with premium cars (whether 100k or 50k) would be very eager to become taxi drivers. May be we should create a poll here - but I find it very unlikely that more than a handful of people want to do something like that.

Well, If they bring back the roadster referral giveaway, driving for uber might generate 3 or 4 roadsters a year !