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

[Maarten]

Or the person consuming the food is a absurdly fast eater

Reminds me of a story that may amuse you all.
Must have been somewhere in 2014 that I received a message from Tesla that Elon Musk was coming to Amsterdam.
He would like to have a chat with the first car owners, to talk about what they thought about their Model S so far.
I accepted the invitation and went to Amsterdam and attended the meeting, it was great.
Remember him coming in and saying: ‘Hi guys, so what do you want to talk about?'

Afterwards I contacted his Personal Assistant (was still possible then) and invited Elon to have dinner at our home.
My wife is an accomplished Balinese chef (damn difficult to keep my belly in shape..) and she could make him a fine special Balinese dinner.
His PA told me that he unfortunately had no time and wanted to go back to the USA quickly.
Later I heard that he did have time to quickly eat pancakes somewhere in The Netherlands.

Well, I now know that Elon likes to spend little time at eating, so he can work more.
Still, would have been nice to discuss stuff in private with him!

 

[Artful Dodger]

FSD (Supervised) v12.3.5 has begun rolling out:

https://twitter.com/x/status/1781541347301675490

 

[Zaddy Daddy]

What the heck is going on…?

https://twitter.com/x/status/1781511535304577062

Musk has chosen war.

War on profits in order to push volume.

It’s a bold strategy, getting close to the point that Tesla ends up break even on automotive cash flows.

At this point I can’t see institutional investors buying into the robotaxi narrative from a risk-adjusted investment perspective, so this maybe devalue the company significantly in the near term.

We already hit $150 which I warned would happen when at $200 due to downward trajectory if Q1 deliveries… normally I would think this is enough of a sell off to be the bottom, but this and the comp plan uncertainty really do induce more perceived risk than even a few months ago.

I think another 20% haircut might happen. I’m really wanting to buy back in but I don’t think it’s near the time yet.

 

[Bet TSLA]

Yes, and also he talks like that all the time about a lot of things.

Tesla has risked everything in a sink-or-swim fashion only three times:

1. Roadster
2. S
3. 3

If any of those launches had failed, Tesla would’ve died and gone out of business. Game over. That’s why Elon dropped all other priorities to sleep in the factory to support Model 3 Production Hell. I can’t help but notice he’s not doing that for the robotaxi.

Agreed on the first two. The third was just hyperbole. Tesla could have easily gotten outside investment to get them past the crisis. It wasn't as though the Model 3 was never going to be produced, just that it wasn't going to happen fast enough. Elon's talk of looming bankruptcy was nonsense, just meaning bankruptcy if we don't get some outside funding, with Elon having to give up some ownership and control.

It wasn't existential the way the other two were.

 

[Quesder]

What the heck is going on…?

https://twitter.com/x/status/1781511535304577062

Weird. Previously I checked ALL-wheel drive MY was already 44900. Did I confuse AWD to RWD?

 

[Quesder]

Musk has chosen war.

War on profits in order to push volume.

It’s a bold strategy, getting close to the point that Tesla ends up break even on automotive cash flows.

At this point I can’t see institutional investors buying into the robotaxi narrative from a risk-adjusted investment perspective, so this maybe devalue the company significantly in the near term.

We already hit $150 which I warned would happen when at $200 due to downward trajectory if Q1 deliveries… normally I would think this is enough of a sell off to be the bottom, but this and the comp plan uncertainty really do induce more perceived risk than even a few months ago.

I think another 20% haircut might happen. I’m really wanting to buy back in but I don’t think it’s near the time yet.

Did you sell all your shares or just trimmed some %?
In my case, I sold half of my above $170, but man, the rest 50% still created a lot of pain this week.

 

[Singuy]

Musk has chosen war.

War on profits in order to push volume.

It’s a bold strategy, getting close to the point that Tesla ends up break even on automotive cash flows.

At this point I can’t see institutional investors buying into the robotaxi narrative from a risk-adjusted investment perspective, so this maybe devalue the company significantly in the near term.

We already hit $150 which I warned would happen when at $200 due to downward trajectory if Q1 deliveries… normally I would think this is enough of a sell off to be the bottom, but this and the comp plan uncertainty really do induce more perceived risk than even a few months ago.

I think another 20% haircut might happen. I’m really wanting to buy back in but I don’t think it’s near the time yet.

Well Tesla can make this 2k difference in price back in 1.5 years if they sub to FSD and supercharge. So now that FSD is somewhat of an actual product, you never want to reduce volume at such a critical time.

 

[Robertj]

Here’s some nice news

https://twitter.com/x/status/1781558948144820578

 

[EQC_]

Direct statement from Tesla on the Mission:

https://twitter.com/x/status/1781518596990231026

So, I don't know what story to believe about Tesla's current demand and inventory level. Did they really build up 50,000 more cars in inventory last quarter, or are those mostly just in transit due to all the shipping issues/eco-jerks attacking, etc.?

But, I do know that the only place I really see info about Tesla's price drops is here, various Tesla fan twitters, on other car-related sites, and in the financial analyst "sky is falling" articles....and that entire audience seems relatively small.

At least in the US, I feel like the info about Tesla's pricing is really going to a small minority of the car buying public and many people still think Tesla cars are "expensive toys for the rich..."

 

[Artful Dodger]

Well Tesla can make this 2k difference in price back in 1.5 years if they sub to FSD and supercharge. So now that FSD is somewhat of an actual product, you never want to reduce volume at such a critical time.

Indeed, and Tesla made back this <5% price drop in just 6 months due to drop in raw material costs, and the normal annual drop in COGS.

 

[Skryll]

I typically don't post much because ya'll get to it before me but just note, "190 miles (305 km) CLTC range". That is a realistic USA range of probably 150+ miles.

Tesla already tried to sell a low range Model S and no significant quantity of people wanted it (2013). That is probably the real reason BYD has no intentions of selling it in the US. One of my Australian friends talks about the BYD vehicles he has purchase but always about how he is hypermiling. I am sorry but that is only for us dogged EV owners. No typical driver wants to do that. I no longer wish to drive with the windows up for better aero, AC off for better w/m, and 55mph in a 70. It was fun just to see if I could get down to 225w/m but just for that one time. I have the battery to just drive however I want.

Also Nissan already tried to sell these low range EVs and they were not popular.... not 2M cars popular but they were more than $10k.

While I think BYD is strong composition it seems everyone forgets they roughly sell half hybrids (which I do not consider EVs) and half full battery EVs. That is NOT Tesla's mission.

View attachment 1040060

That would compete with the leaf. Aggressive price.

 

[Artful Dodger]

So, I don't know what story to believe about Tesla's current demand and inventory level. Did they really build up 50,000 more cars in inventory last quarter,

Well this part at least is fairly simple. I'm not going to believe any story pushed by TSLAQ short sellers.

As for the rest, I'm sure it's a combination of some cars in transit, some cars mispositioned due to end of quarter logistics, and of course production delays due to model 3 highland and German ecoterrorists.

Bottom line is, do you believe Tesla is managing their business? If so, we hold!

Cheers to the longs!

 

[larmor]

Musk has chosen war.

War on profits in order to push volume.

It’s a bold strategy, getting close to the point that Tesla ends up break even on automotive cash flows.

At this point I can’t see institutional investors buying into the robotaxi narrative from a risk-adjusted investment perspective, so this maybe devalue the company significantly in the near term.

We already hit $150 which I warned would happen when at $200 due to downward trajectory if Q1 deliveries… normally I would think this is enough of a sell off to be the bottom, but this and the comp plan uncertainty really do induce more perceived risk than even a few months ago.

I think another 20% haircut might happen. I’m really wanting to buy back in but I don’t think it’s near the time yet.

War on volume to push profits: focus on ai and fsd and software margins are huge. License to other oems. Safer than a human driver by 50% (low bar) and take out insurance market… if human life has value and decreased car repairs has value than go to war with ai and realize real value…

 

[Dutchie]

..kvetching

Had to look that one up.

This thread is also great for expanding your vocabulary

 

[Quesder]

That would compete with the leaf. Aggressive price.

Speaking of Leaf, I thought it already occupied the "$25,000" slot, because when I bought 2017 Leaf it was close to that price, or even lower.
However, I just checked this dealer price at Dublin, CA, and it is surprisingly expensive:

• MSRP$38,890
• Net Cost$38,385
• Theft Recovery Device 1
  + $899
• EV Customer Bonus Cash 2
  - $1,000
• Dealer Asking Price$38,284

I don't think anyone considering buying an EV will ever choose Leaf instead of Model 3, and Model 3 should have 99% market share.
However, leaf still sells. Why?

 

[NicoV]

Well Tesla can make this 2k difference in price back in 1.5 years if they sub to FSD and supercharge. So now that FSD is somewhat of an actual product, you never want to reduce volume at such a critical time.

Tesla going for the Gilette sales model. Sell the main item as cheap as possible and make as much as possible on the stuff you need to buy to actually use that item. Like printer companies. You may buy your electricity from somebody else, but not your FSD.

 

[CitizenKane]

Tesla going for the Gilette sales model. Sell the main item as cheap as possible and make as much as possible on the stuff you need to buy to actually use that item. Like printer companies. You may buy your electricity from somebody else, but not your FSD.

A big difference though in that a razor without a blade is useless whereas a car without FSD is what 99.99% are currently driving. Tesla's bet is not just to get FSD working but also that enough people want it. This is concerning to me, but if they see great take rate of the 99 usd subscription, they may feel confident.

 

[Quesder]

A big difference though in that a razor without a blade is useless whereas a car without FSD is what 99.99% are currently driving. Tesla's bet is not just to get FSD working but also that enough people want it. This is concerning to me, but if they see great take rate of the 99 usd subscription, they may feel confident.

That really concerns me very much.
$99/month is $6000 over a 5 years time-span, and that is not much on a $40,000 car. Let alone the take rate is probably less than 30%.
And before that happens, now they simply cut MY price by $2000 easily.

 

[alexxs88]

As risky as it is (and it is very risky), going all out on autonomy seems like the best out of a bunch of bad options.

That's my take as well. There's so many companies building cheap ice cars, I don't see any of them setting valuation records. In the long run, my understanding of automotive manufacturing says that there's no moat that you can hold and everyone ends up on the same margins. Which is proven right now. Not to mention that there's some dealer margins hidden in Tesla's figures since they sell direct.

Tesla's valuation has always been dependent on the capability to deliver autonomous driving with a relatively cheap sensor stack. Focusing on that is good, although I must admit i don't see the reasons to not do both. It's not like they don't have the money right now. I'm also concerned on the development outoput of the company. The past 3 years, although marking excellent profits haven't shown new products at the rate at which you'd expect from even a normal car company.

 

[CorneliusXX]

Indeed, and Tesla made back this <5% price drop in just 6 months due to drop in raw material costs, and the normal annual drop in COGS.

Good point - Lithium is down 60% over the last 12 months after spiking in 2021

Nickel is seeing a bit of a run but still down on 2023 prices

Not to mention any technical innovation Tesla has implemented they brings down the idiot index.

I'm not hopeful for strong margins this quarter but at least there are some mitigants of price reductions.