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

[Usain]

Some comments on the "R" in R&D.
When I worked at a consumer products company (beverages) our research and development functions were practically combined. One person led both research and development. There's not a lot of research going on in a beverage company compared to other industries.
But when I got into the Pharma industry, I saw that Research was a totally separate function from Development. There are 100's of ideas and projects in Research and many of them never see the light of day but once a project meets the Proof of Concept goals and is deemed marketable, it passes onto Development to figure out how to engineer, manufacture and in some cases how to market it.

We have much visibility into Tesla's Development pipeline (Gen 2, Optimus, Robotaxi, FSD, even the Tesla van is likely in Development) but we have no visibility into it's Research projects. Likely years ago, Tesla began research work on Steer by Wire, Vehicle to load charging, 48V, single casting, etc. but we were mostly oblivious to it until these ideas moved into Development or were delivered with a product.

At the pharma company I worked at, all analysts covering our stock knew our drug Development Pipeline well but none knew about our Research projects.
My point here is that there are many exciting projects that the Tesla Research team is working on that we won't know about until a few years from now. There will more positive surprises that will move the companies valuation forward.

Elon has said that Tesla doesn't do pure research. That is, any kind of research is expected to be delivered in a product. So all research is done with an eye toward profitability. This is a different mindset from companies that do a lot of research and then look to see if any of them can be productized.

I'm not sure how much secret research is really going on at Tesla. To take Optimus as an example, it sounds to me like Elon talked it over with some people and came up with initial specs for what it should be. But it sounds like engineers didn't take out their screwdrives and start working on a prototype until shortly before the announcement on AI day. (Correct me if I'm wrong)

Are there some big secret projects that Tesla is doing actual research on? That's very hard to say. But I kind of doubt that there is anything going on now that we won't hear about for several years. Tesla tends to have shorter time frames between idea and announcement.

 

[The Accountant]

Elon has said that Tesla doesn't do pure research. That is, any kind of research is expected to be delivered in a product. So all research is done with an eye toward profitability. This is a different mindset from companies that do a lot of research and then look to see if any of them can be productized.

I'm not sure how much secret research is really going on at Tesla. To take Optimus as an example, it sounds to me like Elon talked it over with some people and came up with initial specs for what it should be. But it sounds like engineers didn't take out their screwdrives and start working on a prototype until shortly before the announcement on AI day. (Correct me if I'm wrong)

Are there some big secret projects that Tesla is doing actual research on? That's very hard to say. But I kind of doubt that there is anything going on now that we won't hear about for several years. Tesla tends to have shorter time frames between idea and announcement.

I would think the 4680 battery was in Research before moving into Development and that Tesla had that as a research project well before analysts knew about it. But I could be wrong.

 

[uscbucsfan]

If you click the "Order Now" button, it takes you to a page that says "Reserve Now"
View attachment 999378
View attachment 999379
And the Pre-Order Agreement says (along other things)


Clicking and submitting explicitly does not guarantee delivery next year (or any specific time frame). Same as it ever was.

Doesn't get any more clear that that.

 

[Usain]

If you click the "Order Now" button, it takes you to a page that says "Reserve Now"
View attachment 999378
View attachment 999379
And the Pre-Order Agreement says (along other things)


Clicking and submitting explicitly does not guarantee delivery next year (or any specific time frame). Same as it ever was.

Right. They don't guarantee you a Cybertruck in 2024. But they tell you on the web site that delivery is expected in 2024.

Tesla is not lying and they are not being misleading and they are not playing games with the fine print.

If Tesla had no intention of delivering today's orders in 2024 then that would be misleading.

 

[uscbucsfan]

Right. They don't guarantee you a Cybertruck in 2024. But they tell you on the web site that delivery is expected in 2024.

Tesla is not lying and they are not being misleading and they are not playing games with the fine print.

If Tesla had no intention of delivering today's orders in 2024 then that would be misleading.

Again;

You understand that Tesla may not have completed the development of Cybertruck or begun manufacturing. Cybertruck at the time you entered into this Agreement and so we do not guarantee when your Vehicle will actually be delivered. Your actual delivery date is dependent on many factors, including your Vehicle’s configuration and manufacturing availability.

They aren't telling people who are reserving today that they will get a CT next year or any year. They put this in intentionally.

The "Delivery in 2024" was live the same time the pricing was revealed, before they had an idea of real cancellations and per Tesla they had over 1.5mm pre-orders and can only physically make 125k next year, but it will be less than that with the slower ramp.

It's pretty clear.

Tesla will make all they can in 2024, Deliveries for Cyberbeast and AWD will begin in 2024, and those invited to order should receive in 2024.

 

[SOULPEDL]

I'll repeat this one more time.

Tesla knows better than us how many Cybertrucks are expected to be delivered in 2024.
Tesla knows better than us how many early reservations there are and how many are expected to pay 80K for a Cybertruck in 2024.

Given what Tesla knows, they expect that anyone willing to pay 80K for a Cybertruck who plunks down the $250 deposit is likely to get their Cybertruck in 2024.

If you think Tesla's statement just means delivery will start in 2024, then you are assuming that Tesla is lying and/or playing games and misleading its customers. From what I have seen, Tesla doesn't play silly sales games.

The line cannot be both long and short. However, quantum physics says both are possible (work with me as I speculate...)

Edit, scrap these... the line is still plenty long, read @mongo comments below for a better theory.

1. What if most wanted the single motor and so prior demand doesn't line up with what they need to build (higher end, fewer batteries)?

2. What if Tesla is baking a recession into their forecast here? I haven't heard Elon change his position that one is coming. (What do you believe?) And if so, this bodes well for someone wanting to order one today (if there is a recession, the line will obviously shrink fast). But this is not certain, so still fishy...

3. The alternate narrative is that there's no recession and they can order one today but won't get it for 3 more years. That would cut off long-term demand and increase risk of excess capacity or poor planning. Unobtainium will lose customers, maybe even some of the ones in line already.

Side note... I'm in Az, have early CT orders, and yet I have not received any letters to confirm my intentions with more cash - which was all the hype earlier that they were worried. So I can assume they are still in Tx and Ca and haven't made it to Az yet, keeping them close to home like the other releases. But if they wanted to see real demand, I should have also received that letter. The white lie could be that they said "will" receive it in 2024, and left out the conditions that would satisfy that scenario. Who knows, could be a flaw in the sim.

 

[Usain]

I would think the 4680 battery was in Research before moving into Development and that Tesla had that as a research project well before analysts knew about it. But I could be wrong.

I think you are right about that one.

We did know going into battery day that Tesla was working on manufacturing its own batteries. But I'm not sure if it was officially known. Maybe Elon mentioned it? And I'm not sure how long Tesla had been working on 4680's when battery day happened.

 

[SOULPEDL]

Puts are suspiciously low. Does someone know something?

 

[Big Time]

The only thing I know is this stock is confusing. A real brain scratcher

 

[cliff harris]

Historically major revs have made performance worse initially. Add to that Elon saying it'll be worse for at least 6 months on HW4 vs HW3 and all new cars are 4, and I don't see any way this contributes significantly to margins or earnings in 2024 (plus V12 is, like 11 and 10 before it, Teslas best guess on what'll finally get them past L2- they might be wrong- they have been every previous time. They might be right too, but it won't be immediately obvious.)




Which Elon explicitly said will not contribute meaningfully to Tesla financials in 2024.




Showing a prototype might well give a stock bump- but it'll be drown by the slew of articles FUDing around "unveil promises vs delivery reality" citing the CT especially.




Ideally, yes... though I think how soon matters... If it's not relatively early in 2024 then, assuming time from groundbreaking to ramp is say in between shanghai and austin, we're looking at 2026 before it's contributing meaningfully to EPS.




I think there's a roughly 0% chance anyone will be able to buy one in 2024 from Tesla. You might see them being tested in Tesla factories though but I'd expect at least one or two more major revisions (at least one based on the feedback from internal factory testing over months of time) before considering any external sales. And that's assuming they get all the SW in as good a shape as the HW in that time.



I know many folks in the thread aren't big Troy fans-- but he's got 2024 deliveries around 2-2.1M. His average error rate on deliveries is only 2.5%. YoY growth is going to be the smallest we've seen in many years on vehicles-- and much as we know Tesla is not just a car company that's still where most of the revenue is.

Tesla energy will help some- and this year should help set up a lot of FUTURE stuff-- but barring some rabbit out of hat stuff I don't see much in 2024 that looks awesome for share price growth in 2024

Some might call that a buying opportunity.

I generally agree, but I think your last paragraph is a bit pessimistic. Even assuming just 2.2m car deliveries, we will also have this in 2024:

• Updates to the bot
• V12 FSD rollout
• China FSD, possibly Europe too.
• Maybe start of real semi production
• Possible Model 2 reveal
• Tesla energy scaling up

Thats plenty of stuff to fuel a stock price rise. Its also possible that one of the EV competitors (lucid? rivian?) actually implodes due to poor financials. I would be very surprised if we are not at $300 soon in 24, and actually expect $400 next year. Wall st assign no value to bot or FSD. If either start looking like serious businesses, then things will change.

Personally I think the biggest impact is going to be the semi+cybertruck being made in serious quantities. Right now Tesla is seen as a company that makes sedans and SUVs. Add trucks and pickups and it looks more diversified, safe and reliable as an investment.

 

[uscbucsfan]

The line cannot be both long and short. However, quantum physics says both are possible (work with me as I speculate...)

1. What if most wanted the single motor and so prior demand doesn't line up with what they need to build (higher end, fewer batteries)?

This community based tracker had 1.25 million people submit their pre-order information. These are the stats:

Dual-Motor: 48% of reservation holders have chosen this Cybertruck variant, while 44.5% have chosen the Tri-Motor configuration. Only 7.5% have gone with the Single Motor build.

 

[Usain]

Again;

You understand that Tesla may not have completed the development of Cybertruck or begun manufacturing. Cybertruck at the time you entered into this Agreement and so we do not guarantee when your Vehicle will actually be delivered. Your actual delivery date is dependent on many factors, including your Vehicle’s configuration and manufacturing availability.

They aren't telling people who are reserving today that they will get a CT next year or any year. They put this in intentionally.

The "Delivery in 2024" was live the same time the pricing was revealed, before they had an idea of real cancellations and per Tesla they had over 1.5mm pre-orders and can only physically make 125k next year, but it will be less than that with the slower ramp.

It's pretty clear.

Tesla will make all they can in 2024, Deliveries for Cyberbeast and AWD will begin in 2024, and those invited to order should receive in 2024.

We can also conclude that Tesla simply has not gotten around to updating their boilerplate agreement. Tesla most certainly has begun manufacturing of Cybertruck.

Telsa is not lying to you. Right in the spot where you check that you want that AWD Cybertruck it says "Delivery in 2024". If Tesla didn't mean it they wouldn't say it.

 

[wipster]

CBS Mornings, another Tesla hit piece, never mentioned once that the "recall" is actually an OTA update, plus an interview with a guy who spoke with Elon 6 years ago and stated that Elon hung up on him! Where do they get these people,?

 

[uscbucsfan]

We can also conclude that Tesla simply has not gotten around to updating their boilerplate agreement. Tesla most certainly has begun manufacturing of Cybertruck.

Telsa is not lying to you. Right in the spot where you check that you want that AWD Cybertruck it says "Delivery in 2024". If Tesla didn't mean it they wouldn't say it.

Lying is an odd term to use. I, and others here, think you are misinterpreting that. They put that agreement in there intentionally...unless you want to make the same leap that the agreement is lying.

Plus, less than 1,000 people have ordered a CT. Reservations/Pre-orders are not orders. I believe they will deliver all orders they take and promise a 2024 delivery.

 

[SOULPEDL]

This community based tracker had 1.25 million people submit their pre-order information. These are the stats:

Dual-Motor: 48% of reservation holders have chosen this Cybertruck variant, while 44.5% have chosen the Tri-Motor configuration. Only 7.5% have gone with the Single Motor build.

There goes my first theory!
Quite the puzzle.

 

[mongo]

We can also conclude that Tesla simply has not gotten around to updating their boilerplate agreement. Tesla most certainly has begun manufacturing of Cybertruck.

Telsa is not lying to you. Right in the spot where you check that you want that AWD Cybertruck it says "Delivery in 2024". If Tesla didn't mean it they wouldn't say it.

The agreement says "may not have completed..." so it's still accurate. As is "Your actual delivery date is dependent on many factors, including your Vehicle’s configuration and manufacturing availability."

As to "Delivery in 2024", that's in contrast to "Available in 2025" for RWD. That Model will be delivered in 2024, but maybe not to you...

 

[2daMoon]

You are misrepresenting what the web site actually says. Go to tesla.com/cybertruck.

There is a button that says, "Order now". "Oder now" means order now. It doesn't mean place a hopeful reservation. It means order now.

Then if you look at AWD or Cyberbeast it says, "Delivery in 2024". It doesn't say, "Deliveries for this model start in 2024". It says, "Delivery in 2024".

So, Tesla expects that if you "Order now", you are putting down your $250 deposit and Tesla expects that you will have "Delivery in 2024".

How can anyone think this means something other than what Tesla plainly says?

From that page:

You will be invited when your cybertruck is ready to be configured
​

Next, go to the model Y, or 3, or any other model's "Order" page and see if you notice any difference between how much you put down on an actual order, and how much you put down on what you are calling a CT order.

On those model's pages, when you ORDER you aren't asked to put $250 down and wait in line to be invited to configure your "order" are you?

The $250 is a reservation deposit. Only when you are "invited" to configure your CT is when the ordering happens. There will be more money asked for at that time, as the $1K was with the Founders orders.

Believe whatever you want to, by looking at how Tesla sells their cars, it is clearly different with CT.

This is because they are just adding more "$250 orders" to the long list of "$100 reservations" and none of them will get to "configure" the CT they will purchase until their number is called.

When their number is called will be based upon their place in line secured by a $100 or $250 deposit.

 

[ThortsMD]

Agreed that the majority of charging is done at home, but you make it sound as if all trips are drive to one hotel, spend one or more nights, and then drive home. This is true for Japanese Love Hotels, but many trips consist of several days and several hotels with charging at Superchargers between. Having done many trips in ICE vehicles over the years before Tesla, the only time I noticed a real difference was during the first couple of years when Superchargers were make of unobtainium.

This past summer I drove around the continent. 5 of the first 8 nights (Seattle to Quebec) I stayed at Canadian lodgings with destination chargers, having planned the route in advance to take advantage of the cost and time savings. I thought of the Supercharger savings as hotel discounts. Westbound through the States I was able to find exactly....zero such lodgings along my route. I welcome Best Western's move. They were early adopters of EV infrastructure (both Superchargers and destination chargers in western North America) and made travel before widespread SCs possible. This past spring one of the first to do so at Mt Shasta was installing a dedicated group of Rivian-specific charging stations. Wonder if they stopped construction of those with Rivian moving to the NACS and there being 20 Tesla SCs on site now.

 

[mongo]

Release note for the NHTSA update. No change to where it can be activated.

2. Over-the-Air (OTA) Recall
In accordance with a recent recall (campaign # 23V-838 for US and # 2023-657 for Canada) Tesla is making the following improvements to Autosteer:
— Improved visibility of driver monitoring warning alerts on the touchscreen by increasing the text size and moving the notifications to a more prominent position (Model 3 & Y only)
— Added option to activate Autopilot with a single stalk press, instead of two, to help simplify activation and disengagement
— Increased strictness of driver attention requirements when using Autosteer and approaching traffic lights and stop signs off highway
— Introduced a suspension policy that will restrict Autosteer for one week if improper usage is detected. Improper usage is when you, or another driver of your vehicle receive five "Forced Autopilot Disengagements"

 

[jerry33]

This past summer I drove around the continent. 5 of the first 8 nights (Seattle to Quebec) I stayed at Canadian lodgings with destination chargers, having planned the route in advance to take advantage of the cost and time savings. I thought of the Supercharger savings as hotel discounts. Westbound through the States I was able to find exactly....zero such lodgings along my route. I welcome Best Western's move. They were early adopters of EV infrastructure (both Superchargers and destination chargers in western North America) and made travel before widespread SCs possible. This past spring one of the first to do so at Mt Shasta was installing a dedicated group of Rivian-specific charging stations. Wonder if they stopped construction of those with Rivian moving to the NACS and there being 20 Tesla SCs on site now.

I start my trips in the DFW area. I've traveled to Seattle and haven't had any issue finding Tesla Destination chargers. I did travel extensively in Western Canada (Thunder Bay to Vancouver and most places in all the Western Provinces) for fifteen years, but that was long before there was any such thing as an electric car (or even a hybrid).