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

[Seattle]

If Tesla was an actually transparent company we'd be able to see the trend lines of each model in the quarterly P&D report.

That's a great point. It's always been irritating that they don't break out the models. They like to hide their problems is the only reason I can see. It's a public company, we all want to see how many CT they sell, what do the S sales look like at this point. We want to know how much the Y sales appear to have shrunk. Again, it's a public company.

 

[DarkandStormy]

I would like to see some trend lines of each model from these other transparent companies since Tesla lacks so much transparency.

Feel free to peruse their reports then.

 

[Näky]

Something I've been pondering recently as Tesla's focus has almost seemed to shift from "Accelerating the world's transition to sustainable energy" (paraphrase) which made me want to invest in them to becoming more of an AI company is how that would impact my investment decisions going forward.

We need bots to sustain and serve aging and decreasing population in western and eastern countries. Bots consume electricity which is cheapest to produce with solar. So it forces change to sustainable energy. With bots we can sustain growth even decreasing amount of people. And after a while total consumption will decrease. Even if standard of living rise.
I count fsd cars to be bots.

What we need is home AI (PDA?, mind?)to rule and organize our household and its bots by our whim. Home version as in data and processing in secure home server, not in cloud.

 

[Waiting4M3]

I've been updating this table on China production/sales following the format that Rob Maurer used to do. The data are from daas-auto.com, which matches CPCA. I went back as far as 2021. I added a few columns on Rob's format with cumulative inventory build (production-wholesale). I assumed there were ~6k M3 inventory going into 2021 otherwise Tesla would've sold more more M3 than they could've produced in most of 2021 to 1H 2022.

Plotting the inventory levels over time, one can see clearly the spike in Oct 2022 which prompted Tesla to start cutting prices. Interestingly M3 inventory had a buildup in Q4 2023, even though Highland was just introduced and there was a lot of demand. It gradually got whittled down in Q1. IMO this reflects how long Tesla's logistics pipeline really is. They built a lot of M3 for global sales but couldn't ship them out fast enough, likely due to Red Sea detour stretching the RORO supply thin. Last quarter also saw a big buildup in MY supply, necessitating the rate/downpayment incentives in Apr.

 

[Waiting4M3]

A summary of delivery by region and projecting Q2 delivery. I can see total ~405k, breakdown:
Europe: 70k, the 5 daily reporting countries could end with ~20k according to eu-evs.com, they typically correspond to ~1/3 of Europe LHD sales, a very tight range of 31-34%, that gives 60k LHD cars, then UK could have ~10k according to eu-evs.com
China: 140k, so far weekly insurance regs in Q2 is 115k, this past week had Dragon Boat holiday and still had almost 12k, 2 more weeks of ~12k+ puts us at 140k
US: 155k, last quarter was 140k, this quarter it seems much higher anecdotally, with the interest rate incentive, maybe we recover to Q3 2023 level (worst Q of 2023)
RoW: 40k, Q1 was unusually bad, only 1/2 of Q4. I suspect this is due to lack of RORO capacity. I think we bounce back to close to Q2 2023 level

 

[AndrewZ]

All these data, numbers, graphs etc are cool and everything but have you heard that FSD v12.4 will reduce an unknown number of interventions per mile by a factor of 5-10x?

When that unknown future number is realized, it will be far better than the number we presently don’t know.

 

[wtlloyd]

You wrote "hybrids" and "many EVs", not "hybrids with all the relevant features of a Tesla" and "Teslas".
The market doesn't all care about all the features in a Tesla.
RAV4 Hybrid with the features I really care about is $34.2k, Prius $33k, Corolla $27.3k*, Camry $31.2k*.
For BEVs, ignoring the Leaf, the cheapest long-range BEV with sufficient specs is the Kona SEL, at $36.7k.
Maybe when Chevrolet releases the Boltium it'drid come in closer.

* Would not want because sedan.

Specious argument on it's face. BEV and Hybrid ICE are two different beasts. Nobody shops price before features. It's clear that the advantages of BEV over hybrid, ICE, hydrogen...you name it, are evident if you know to look.

 

[elasalle]

https://twitter.com/x/status/1803509682746827127

Italia 300

 

[Buckminster]

https://twitter.com/x/status/1803493519526601160

EPS Increases +17% QoQ to $0.53 Per Share

 

[insaneoctane]

...
Sure, it's a lot of money, but if it meant your current investment going 10x or more, you'd be pretty dumb not to agree to that, by comparison any dilution is essentially meaningless

10x now, 10x then, is still 10x. This new 10x ought to be much harder to deliver on, but that doesn't matter to stockholders. I think a new comp package that offers 10x will pass easily and will, ironically, include many people who voted "no" on the last re-vote.

 

[uscbucsfan]

https://twitter.com/x/status/1803493519526601160

EPS Increases +17% QoQ to $0.53 Per Share

Is this person accurate? I know Troy is really accurate, but I've never heard of this person.

If so, how does everyone think the stock will do? It would be obvious then that the sales will be lower than last year.

Hopefully way off, but I guess many expect that sort of performance this year.

 

[XPEL FTW]

I know sunwarriors noted that he's not directly a shareholder...but any shareholders complaining about Elon's compensation really feels like a G-rated depiction of why prostitutes require payment up front....because there are a lot of selfish people who don't want to pay after the fact.

Spoiler: More rambling description...

In this case, Elon, the board, and the Shareholders all agreed in advance that IF and ONLY IF Elon can get Tesla's market cap to grow from $50billion to $650 billion (ie: a gain of 1200%), and IF and ONLY IF other huge company performance conditions are also met, then he can dilute other shareholders by 10%. That contract for Elon probably felt almost as secure as up-front payment...but AFTER Elon and the Tesla team achieved a whole mess of "impossible" milestones, along came Mr. 9 shares and the courts to try to stop the payment after the fact.

It doesn't matter that 10% of Tesla today is a huge number...the deal was made, 70+% of shares voted to make the deal in advance, Elon kept his end of the bargain and achieved the impossible, and then 70+% of shares voted again to confirm it after that.

And, while Mr. 9 shares apparently has a very small stake...we now know that over 70% of shares voted for Elon TWICE. So, it is a minority of shareholders, and a whole bunch of outsiders with no actual stake in the deal that are complaining.

And, I'm fairly certain that the most noise is actually being made by those non-stakeholders. So, it's like if Elon and I agreed that, if he could earn me $100, then I would pay him $10 later. He earned me my $100, and I've got it in my pocket. A whole bunch of strangers now show up and scream: "don't pay him $10! He doesn't deserve it so you don't have to!" It's like strangers with nothing ot gain or lose are just insisting I be selfish after somebody benefited me.

Hmmm...and now that I think of it, any non-shareholder complaining about Elon's pay package seems like they must be a person who would march around telling OTHER people not to pay their prostitutes after-the-fact for some reason. I can't even fathom the motivation for this sort of behavior.

FWIW once the deal was struck, it needs to be honored IMO. I agree with the majority on that.

But no one is answering the underlying question- I can't think of a single founder / large shareholder/ key man who got such a deal. Why should Musk? It's considered matter of old-school honor by many (including Buffett and Munger, IMO the gold standard in corporate ethics) to simply benefit by the vast increase to your net worth based on your large existing ownership. Musk's NW went up by tens of billions anyway when Tesla 15x'd. He needs another $50B?

Yeah, I get it, that's a minority opinion here, and you guys voted with your wallets for the 2018 package so that's all that matters. I just don't understand why.

It will be interesting to see if others now try to get similar deals. I'm not sure if anyone has even tried before this.....I guess I've got to give credit to Musk for having the stones to even propose the deal.

 

[XPEL FTW]

Is this person accurate? I know Troy is really accurate, but I've never heard of this person.

If so, how does everyone think the stock will do? It would be obvious then that the sales will be lower than last year.

Hopefully way off, but I guess many expect that sort of performance this year.

Troy is at 421 K deliveries for Q2. Down 9.7 % Y/Y.

 

[uscbucsfan]

Troy is at 421 K deliveries for Q2. Down 9.7 % Y/Y.

So they have the same number, I guess.

 

[Bet TSLA]

https://xkcd.com/2948/

Electric vs Gas

Tough choices, aren't they?

 

[Seattle]

If so, how does everyone think the stock will do? It would be obvious then that the sales will be lower than last year.

It looks extremely unlikely for sales to be higher than last year. The stock should probably go down because it's overvalued already, but I don't think it will unless Musk quits or sales go down by much larger amounts. And I'm always wrong about the stock. Every quarter brings a new EV to market from another ICE company, and they just keep getting better. CT has about worked through its pre-order people who will buy one (reminds me I need to cancel mine).

The only thing that would save sales for the year are new models or significant new features, or huge price cuts. In q1 they were about 20k fewer sales in the US than q1 a year ago, that estimate above is about the same number below in q2 which is reasonable. After trying everything else, I still expect them to try out the easy things to juice sales, but only after they try tweaking prices. Please

• allow the transfer supercharging, transfer FSD.
• add a freaking 120v outlet. Wish they would also add a 240v outlet option for cost - wouldn't it just be a bigger transformer?); for WW sales they'd have to do 240 anyway. Hyundai/Kia have this, come on Tesla, another example of lack of progress over time.
• some more small price cuts
• something to stimulate powerwall and solar sales
• add more desired user options on the browser/UI

Things they should do

• They should add back turn stalks but Musk won't do that, he's just too stubborn
• Add in the new V2X features from the CT, but that's hard and not a few quarters project, probably reqs the newer CT batteries; 800v doesn't matter as much
• Somehow sell a version of the s that makes it eligible for the 7500 tax rebate (make it cheaper, or make it heavier - 6000 lbs I think is the SUV reqd).

 

[DarkandStormy]

https://twitter.com/x/status/1803493519526601160

EPS Increases +17% QoQ to $0.53 Per Share

This would be a ~10% decline in deliveries and a ~42% decline in EPS, YoY.

 

[bpjod]

But no one is answering the underlying question- I can't think of a single founder / large shareholder/ key man who got such a deal. Why should Musk?
...
It will be interesting to see if others now try to get similar deals. I'm not sure if anyone has even tried before this....

Why shouldn't every CEO compensation package be structured like this? No CEO ever gets a penny in salary. No Golden Parachutes. Only stock and options to purchase more if ambitious performance targets are met. Then they must hold onto the shares obtained by executing the options for a significant number of years after exercising said options. One could argue that maybe it was overly generous - could have offered 1/2 as many options per tranche for instance, but the overall design is one I feel should be given serious consideration by all public companies.

Incentivised him to achieve the near impossible. Worked for me as a shareholder. I fail to see the downside.

 

[Seattle]

Why shouldn't every CEO compensation package be structured like this? No CEO ever gets a penny in salary. No Golden Parachutes. Only stock and options to purchase more if ambitious performance targets are met. Then they must hold onto the shares obtained by executing the options for a significant number of years after exercising said options. One could argue that maybe it was overly generous - could have offered 1/2 as many options per tranche for instance, but the overall design is one I feel should be given serious consideration by all public companies.

Incentivised him to achieve the near impossible. Worked for me as a shareholder. I fail to see the downside.

Should we give 15+% of a company to a previously successful CEO who stopped paying attention for a year or two except half showing up at important events (remember the last, unorganized weird CT event where a few people drove off with them), right when that company's sales are suddenly dropping, unlike the rest of the industry? The answer is no.

 

[Thekiwi]

Tesla delivered ~9% fewer cars in 24Q1 compared to 23Q1, in 23Q2 Tesla delivered ~10% more cars than in 23Q1

So if they were to delivery the same in Q2 as Q1 it would be -17% compared to 24Q2, and the only way that would "help shape the narrative" is that the stock would drop hard

I think the minimum number they beed for Q2 is 420k, which put's it on par with the Q1 drop YoY

But as things look right now I fear that even 400k might be a stretch... hard to tell, but China and Europe numbers not looking so pretty. Maybe there are other territories making up for its but the CN wholesale numbers don't seem to indicate that either

We shall see! I can't recall seeing. an estimate from @Troy recently...?

@Troy now keeps his estimates private to his patreon members. Good for him, I’m sure it’s not worth the hassle he was getting when providing them for free.

From a rough perspective Q2 looks to be:

- Europe: Down
- China: Flat-ish
- USA: Up
- ROW: