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

[mongo]

And as far as the cybertruck, I trust that they designed it to be easier to manufacture than anything they’ve made before. But when you have a new product built with new ideas a risk you run is that you’ve designed in a flaw that will require a recall. If you come out of the gates and make as many of them as physically possible and then it turns out something not fixable by a software update caused a recall it’s very expensive.

That's not what I got from the call:

It's difficult to make an accurate guess at this point. Going back to what I said earlier that the ramp is going to be extremely difficult. And like I said, there's no way around that. If you try to make -- if we just try to do some copycat vehicle design, of which there are literally 200 models that are slight variations on a theme in the combustion engine world, just a distinction without a difference, then it's really not that hard. But if you want to do something radical and innovative and something really special like the Cybertruck, it is extremely difficult because there's nothing to copy. You have to invent not just the car but the way to make the car. So, the more uncharted the territory, the less predictable the outcome. Now, I can say that if you say, well, where will things end up, I think we'll end up with roughly 0.25 million Cybertrucks a year, but we're not -- I don't think we're going to reach that output rate next year. I think we'll probably reach it sometime in 2025. That's my best guess.

Gen 3 is easier, especially in contrast:

So, now the sort of high-volume, low-cost smaller vehicle is actually much more conventional.
Unknown speaker Yeah. In terms of like the technologies we're putting in, we didn't have to invent to be full hard stainless steel or have mega 9,000-ton castings or the largest hot stamping in the world or high [Audio gap]
Elon Musk Are quite in the same way as the Cybertruck. I think it will be quite a fast ramp. As I was saying, we're doing everything possible to simplify that vehicle in order to achieve a units-per-minute level that is unheard of in the auto industry.

Tesla (TSLA) Q3 2023 Earnings Call Transcript | The Motley Fool

 

[ItsNotAboutTheMoney]

Model Y vs Model 3 , OMG one has a hatch and one has a trunk. Guess what, I and others cross shop these two.

Add a new compact Tesla to the mix and I'll be cross shopping all 3.

Model Y sales are much bigger than Model 3, despite it being a lot more expensive and less efficient. Huge clue to what people want.

To go really big they need it to be a hatch, and the huge majority of buyers of a cheaper hatch aren't going to even take a glance at a more expensive sedan.

 

[Artful Dodger]

I think this might be our first look at the $1000 drive unit, perspective might be screwing it up, but it looks like a transaxle, with a possible planetary gearing for that to be possible, which make sense, at really high volume your cost is mostly material, planetary allows you lower material volume for the same power

View attachment 983542

I think that's a Model 3/Y drive case, possibly photographed in Shanghai. See the date on the label: (possibly "???ED 10-3-22)

 

[hobbes]

View attachment 983481

Q3, 2022 Elon - "We anticipate continuing to grow our vehicle production sales deliveries...on average 50% a year as far into the future as we can see."

Q3, 2023 Elon - "It's not possible to have a compound growth rate of 50% forever."

As they (even Elon) can´t see into the future infinitely, those two statements technically don´t even contradict each other.
Just a very different point of view..

 

[GOVA]

Model Y sales are much bigger than Model 3, despite it being a lot more expensive and less efficient. Huge clue to what people want.

To go really big they need it to be a hatch, and the huge majority of buyers of a cheaper hatch aren't going to even take a glance at a more expensive sedan.

Can you provide any sources for those sales figures (3 vs Y) ? I'd be great to see a breakdown by a country too.

 

[Usain]

The decision to delay Giga Mexico and gently ramp Berlin and Austin is surprising to me. Only a couple of quarters ago the guidance was that production growth would continue at maximum speed. I think Elon had said something like "pedal to the metal, rain or shine". Why such a major change of direction now? Tesla also has even more liquidity now than when he said that. Further, if affordability is the primary challenge, wouldn't that increase the importance of Gen 3 production in Monterrey?

I think delaying Mexico makes perfect sense in light of the recent decision that Gen 3 will first be built in Texas. Tesla wants to prove out its process for building the Gen 3 first. It would be unwise to construct a new money furnace when they aren't ready to start building cars inside it.

 

[EVWatcher]

That's not what I got from the call:


Gen 3 is easier, especially in contrast:

Tesla (TSLA) Q3 2023 Earnings Call Transcript | The Motley Fool

I think it’s worth sitting down and thinking about what a lot of things mean in context.

Words like “difficult” in this context are ambiguous. Difficult could mean that they could find that the production line gets held up by individual assembly steps. It could also mean something akin to panel gaps in that they could move through the assembly line at the appropriate speed by exit with unpredictable outcomes.

Phrases like “So, the more uncharted the territory, the less predictable the outcome” say more and in my interpretation carry a meaning of “we just don’t know what we don’t know so we are being conservative about moving forward In every way possible.

None of that means they designed it poorly. It just means they are doing new things and while they felt very smart in design meetings, until they get a few hundred thousand made they are going to keep from doing a victory dance.

Gen 3 having fewer revolutionary manufacturing innovations that could cause hiccups doesn’t mean cybertruck wasn’t design with streamlined assembly in mind. It just means that the gen 3 vehicle is both designed with streamlined assembly in mind and uses mostly conventional things.

Or I’m just all wrong. None of us really know. I don’t think Elon speaks in ways open to interpretation deliberately, I just think he doesn’t feel the need to speak with crystal clarity.

 

[hobbes]

Yes, either on Q1 or Q2 earnings call Drew answered that and confirmed that Texas only ever did DBE on both

Searched both transcripts for "DBE" and "dry" and didn´t find any statements like that..
Maybe someone else is more lucky?

Tesla Q1 2023 Earnings Call Transcript

Read the full transcript for Tesla's Q1 2023 earnings call at MarketBeat. No login or account required.

www.marketbeat.com

Tesla (TSLA) Q2 2023 Earnings Call Transcript | The Motley Fool

TSLA earnings call for the period ending June 30, 2023.

www.fool.com

 

[FreqFlyer]

I think delaying Mexico makes perfect sense in light of the recent decision that Gen 3 will first be built in Texas. Tesla wants to prove out its process for building the Gen 3 first. It would be unwise to construct a new money furnace when they aren't ready to start building cars inside it.

Interesting point why Mexico is important as a factory. Mexico has more trade agreements to export tariff free compared to the US. @ 6:10

 

[mongo]

I think it’s worth sitting down and thinking about what a lot of things mean in context.

Words like “difficult” in this context are ambiguous. Difficult could mean that they could find that the production line gets held up by individual assembly steps. It could also mean something akin to panel gaps in that they could move through the assembly line at the appropriate speed by exit with unpredictable outcomes.

Phrases like “So, the more uncharted the territory, the less predictable the outcome” say more and in my interpretation carry a meaning of “we just don’t know what we don’t know so we are being conservative about moving forward In every way possible.

None of that means they designed it poorly. It just means they are doing new things and while they felt very smart in design meetings, until they get a few hundred thousand made they are going to keep from doing a victory dance.

Gen 3 having fewer revolutionary manufacturing innovations that could cause hiccups doesn’t mean cybertruck wasn’t design with streamlined assembly in mind. It just means that the gen 3 vehicle is both designed with streamlined assembly in mind and uses mostly conventional things.

Or I’m just all wrong. None of us really know. I don’t think Elon speaks in ways open to interpretation deliberately, I just think he doesn’t feel the need to speak with crystal clarity.

It may be easier (less steps) to manufacture once they get manufacturing working, but getting manufacturing working in the first place was made harder by Cybertruck's design.

9,000 ton press: harder, but fast once successful
Hard stainless steel: uncharted cutting/ bending/ assembly processes, but no outer paint shop
Double voltage architecture: new modules, but less wire mass

 

[Usain]

Searched both transcripts for "DBE" and "dry" and didn´t find any statements like that..
Maybe someone else is more lucky?

Tesla Q1 2023 Earnings Call Transcript

Read the full transcript for Tesla's Q1 2023 earnings call at MarketBeat. No login or account required.

www.marketbeat.com

Tesla (TSLA) Q2 2023 Earnings Call Transcript | The Motley Fool

TSLA earnings call for the period ending June 30, 2023.

www.fool.com

The Q1 2023 call had this:

On cathode production, we are 50% equipment and 75% utilities installed at our new cathode building in Austin, with our goal to begin dry and wet commissioning this quarter and next quarter with a target to produce first material before the end of the year.

But I don't know what that definitively means.

 

[elasalle]

I think delaying Mexico makes perfect sense in light of the recent decision that Gen 3 will first be built in Texas. Tesla wants to prove out its process for building the Gen 3 first. It would be unwise to construct a new money furnace when they aren't ready to start building cars inside it.

Delay Mexico, speed up the Semi ramp. Maybe time to even do low volume Roadster (less space, less batteries, no alien tech/manufacturing process).
Might also be good to release Van specs and create low volume pilot/production lines ...

eons ago, Elon said they would do multiple products at once ...

the Governor of the Mexico state is on a world tour of GFs

26B in cash, hope a good chunk is earning good interest ...

 

[Usain]

It may be easier (less steps) to manufacture once they get manufacturing working, but getting manufacturing working in the first place was made harder by Cybertruck's design.

9,000 ton press: harder, but fast once successful
Hard stainless steel: uncharted cutting/ bending/ assembly processes, but no outer paint shop
Double voltage architecture: new modules, but less wire mass

Back when Tesla said the Cybertruck would be easier to manufacture, they still didn't know how it would ultimately be built. Case in point is that back then, a 9,000 ton press had never been built and probably never even conceived of.

I'm sure that Cybertruck's promised ease of manufacturing was a sincere belief, but they have learned some lessons since then.

The good news is that Tesla has had a really long time to work on the problem. I expect the ramp to at least go better than Model 3.

 

[mongo]

Searched both transcripts for "DBE" and "dry" and didn´t find any statements like that..
Maybe someone else is more lucky?

Tesla Q1 2023 Earnings Call Transcript

Read the full transcript for Tesla's Q1 2023 earnings call at MarketBeat. No login or account required.

www.marketbeat.com

Tesla (TSLA) Q2 2023 Earnings Call Transcript | The Motley Fool

TSLA earnings call for the period ending June 30, 2023.

www.fool.com

2023 Investors Day?

we haven't stalled out yet on the rate of progress either and that's both on the anode and the cathode side

 

[EVWatcher]

It may be easier (less steps) to manufacture once they get manufacturing working, but getting manufacturing working in the first place was made harder by Cybertruck's design.

9,000 ton press: harder, but fast once successful
Hard stainless steel: uncharted cutting/ bending/ assembly processes, but no outer paint shop
Double voltage architecture: new modules, but less wire mass

I think we kinda agree but are having an exchange as if we disagree

 

[mongo]

I think we kinda agree but are having an exchange as if we disagree

Yeah, we agree. Streamlined manufacturing after initial unknown manufacturing.
Gen 3 is streamlined manufacturing after mostly (not fully due to unboxed) streamlined initial manufacturing.

 

[mongo]

Toyota/ Lexus join NACS, for whatever that means in this case....

https://twitter.com/x/status/1715095472933876212

 

[thx1139]

As they (even Elon) can´t see into the future infinitely, those two statements technically don´t even contradict each other.
Just a very different point of view..

What changed so drastically since Q3 2022 and Q3 2023? Inflation has gone down and what interest rates have been risen like 1%.

 

[Tony73]

What changed so drastically since Q3 2022 and Q3 2023? Inflation has gone down and what interest rates have been risen like 1%.

Elon woke up on the wrong side of the bed.
Zack Kirkhorn was not just a great CFO. He was an effective communicator .

 

[Drumheller]

The decision to delay Giga Mexico and gently ramp Berlin and Austin is surprising to me. Only a couple of quarters ago the guidance was that production growth would continue at maximum speed. I think Elon had said something like "pedal to the metal, rain or shine". Why such a major change of direction now? Tesla also has even more liquidity now than when he said that. Further, if affordability is the primary challenge, wouldn't that increase the importance of Gen 3 production in MonMonterrey

It seems to me, in the current environment, Tesla is not confident they have the demand to sell every car if they keep ramping as quickly as possible. (Buy a share tomorrow morning, @Krugerrand ). We can argue forever and get nowhere trying to guess all the factors impacting that situation. I'm of the opinion, that I think agrees with Elon, that the economy is the largest factor at this time. This also indicates to me that Elon / Tesla are anticipating the economy worsening or, at least, not improving in the short term.

just a random thought-- Mr. Musk's ability to forecast macro econ isn't great... case in point, it was only 15-18 months ago that he was spending money on the bird acquisition (at a premium) and the backdrop changed quickly in the ensuing months.

GFC scarred many people, and that's always going to be there... and rates are a big pain in the butt, but I don't know if he can forecast better than anyone else.

His purchase of the bird was driven by a specific concern and goal at that time, regardless of the price. I think he is succeeding with that goal, and I'd guess he considers it money well spent from that point of view.

What changed so drastically since Q3 2022 and Q3 2023? Inflation has gone down and what interest rates have been risen like 1%.

Go talk to median income families. Ask them how they're doing. Ask them if they believe the govt stats.