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

[Swampgator]

BMW sold just 12,361 cars in the US in April. That is all cars combined. 2,3,4,5,6,7 series plus I3, I8, X1, and X2

Tesla model 3 almost matched their entire cars sales in the US last month.

 

[Swampgator]

BMW sold just 12,361 cars in the US in April. That is all cars combined. 2,3,4,5,6,7 series plus I3, I8, X1, and X2

Tesla model 3 almost matched their entire cars sales in the US last month.

Oh, BMW passenger car sales were down 17% from last April. Tesla sales are up almost 100% from April 2018 in the US.

 

[lklundin]

This is fascinating. Panasonic is really screwing up -- failing to get to targeted production levels. Tesla has all the leverage. The opposite of the LG Chem situation where LG Chem has all the leverage against the other carmarkers.

OK. But what really seems important is:

Will Panasonic be able to deliver?

Because rather than SR+ with ASP 40k$ and 20% profit margin, I would like to see the Model 3 ASP at 50 k$ with a 25% profit margin - and a real ramp-up of Power Wall deliveries for which the demand is almost entirely unfulfilled.

 

[Artful Dodger]

apparently they need some kind of formal SEC approval of the merger documents which has been delayed somewhat.

They said waiting FTC approval.

 

[Swampgator]

BMW Group sales of electric and plug-in hybrid electric vehicles decreased 52.3 percent in April 2019 vs. April 2018

Wonder why that could be?

 

[neroden]

I've often thought that the best course of action might just be to let the offer expire, let Maxwell crash back down, give people enough time to digest the reality of what happens if they don't accept the merger, then make them a new offer on similar terms to before.

You're a kind person. The classic version of this tactic ends by making a new offer on similar terms at a LOWER buyout price than before.

 

[neroden]

They said waiting FTC approval.

Ah, thanks, I must have misheard the conference call. Citation?

 

[Dig deeper]

I know I'm not the only one wondering when, not if, Tesla will unveil their own cell lines. We know how much they obsess over vertical integration. Their problems with Panasonic will only accelerate the push to in-house this last key element.

Wouldn't be surprised if Grohmann is working on it right now.

Perhaps they would unveil something in that regard during their battery investor presentation (slated to occur sometime later this year). The ambiguity surrounding their relationship is frustrating. I was surprised we didn't get more information from either party after their lease contract ended for Giga1 cell lines in '18.

 

[neroden]

OK. But what really seems important is:

Will Panasonic be able to deliver?

Well, the optimistic view is -- if the problem is that the lines are constantly going down due to incompetent employees, and that there's high scrap rates, *these should be fixable problems* once Elon trains his Eye of Sauron on them. They aren't insoluble hitting-a-brick-wall problems, like "Sorry, we cannot automate this step in the car production line without redesigning the entire car, and it is labor-intensive".

I tend to believe the problems are solvable and will be solved.

Because rather than SR+ with ASP 40k$ and 20% profit margin, I would like to see the Model 3 ASP at 50 k$ with a 25% profit margin - and a real ramp-up of Power Wall deliveries for which the demand is almost entirely unfulfilled.

 

[ReflexFunds]

The key is lots of labeled data. They have people label the data that comes in so there is a heavy manual component on top of the easy part, which is collecting the data.

Collecting the right data is not the easy part, it is exceptionally difficult. Tesla cars drive something like 0.5 million hours per day. Good luck hiring people to watch through that footage every day to annotate the interesting parts. You don't even know what the interesting parts are without a very strong system in place to identify self driving system's problems.

Yes, human annotation of the end result is still very important, but the vast majority of the data has already been filtered out before it gets uploaded and reviewed by humans.

 

[neroden]

From what I gather Tesla's problems have nothing to do with competition. They are self-created. If they can fix that situation, the world is theirs for the taking.

Well, we agree on that!

 

[mongo]

Ah, thanks, I must have misheard the conference call. Citation?

@Artful Dodger
Tesla, Inc. (TSLA) Q1 2019 Earnings Call Transcript -- The Motley Fool
Transcript says SEC...

Martin Viecha -- Senior Director of Investor Relations
Thank you very much, Zachary. Let's take some first questions from retail shareholders who have been submitting their questions on say.com. The first question is, will Tesla be able to complete their purchase of Maxwell Technologies? What is holding that back?
Elon R. Musk -- Chief Executive Officer: Jonathan, do you want to...
Jonathan Chang -- General Counsel: Yeah. Hi, it's Jonathan Chang, General Counsel here. Right now, it is going through approvals with the SEC. There is not a whole lot of things holding it back. We're on schedule, we're on track. Right now we're looking to close in mid-May.

 

[Nocturnal]

The Youtube video and the one on CNBC looks the same. Both about eight minutes long with same content. Is there a longer interview out there?

The original CNBC link had the whole interview, but nothing else relevant to Tesla.

 

[Wooloomooloo]

Completely disagree. If what they are working in now comes to fruition, they need to sell licensing rights to other battery manufacturers, not the entire company. Last I saw only about 8 million shares have been tendered. They need a little over 23 million.

The value of Maxwell could grow 10 fold.

It's amazing how passionately people defend the companies they're long in...

Hey look, you could be right - but either way, Maxwell needs some serious cash infusion to keep going, and if it's not from Tesla (who offered more than a 50% premium on the share price) where will it come from? By the time Tesla is a minority in the EV market overall, it will be too late for Maxwell.

 

[Tslynk67]

Btw, has there been any official explanation, why Tesla discontinued 75 version?

They stopped in the run-up to the refresh, but now one assumes available again as the "Standard Range", no?

 

[Tim S]

More good news for @neroden and anyone else in Central or Western NY... this was posted earlier today by the founder of our local fb EV group:

"More good news, now I’m hearing that Rochester is getting a Tesla service center as well. "

It's not on the Tesla site yet. I'll try to confirm tomorrow with Tesla Mobile Service.

 

[RobStark]

Our three realtime European countries - Norway, Netherlands, and Spain - all posted record first-month quarters. Some of them blowouts.

I can't believe Spain post in realtime while the UK takes 3 months.

 

[Artful Dodger]

Ah, thanks, I must have misheard the conference call. Citation?

Indeed the Motley Fool transcript says "SEC":

Martin Viecha -- Senior Director of Investor Relations

Thank you very much, Zachary. Let's take some first questions from retail shareholders who have been submitting their questions on say.com. The first question is, will Tesla be able to complete their purchase of Maxwell Technologies? What is holding that back?

Jonathan Chang -- General Counsel

Yeah. Hi, it's Jonathan Chang, General Counsel here. Right now, it is going through approvals with the SEC. There is not a whole lot of things holding it back. We're on schedule, we're on track. Right now we're looking to close in mid-May.​

I listended to the call live and remember hearing FTC at the time. When I get the time, I'll go back to the audio recording and verify what Jonathan said.

Tesla waiting on FTC approval makes more sense to me since its the Federal Trade Commision that has jurisdiction over mergers and aquisitions:

Merger Review | Federal Trade Commission​

Cheers!

 

[TheTalkingMule]

The original CNBC link had the whole interview, but nothing else relevant to Tesla.

LOL....a few hours ago they had a trimmed down 1min version up. Now they get called out and it's magically back to the full 8:30 version.

Two for flinching!

 

[CorneliusXX]

3dfx and Atari were two companies who, in my opinion at least, snatched defeat from the jaws of victory due to poor corporate governance and some catastrophic strategy decisions. If Tesla fails (and I am not suggesting they will) it will be because of the same reason. It won't be because of Chanos, CNBC, Twitter or anyone else. It will be a simple misalignment between strategy and reality.

I'll roll it back and say, OK this emperor is wearing clothes, but bonds in the clothes are trading at 85 cents on the dollar with an 8% yield... maybe time to change clothes?



He didn't, but Tesla stated in their quarterly report that they may look to raise debt to fund growth.

I am unfortunately prone to hyperbole when responding to hyperbole. I need to meditate much more...

I'm not sure if discussing gaming companies from the 80s and 90s is the most off topic discussion we've had, but i'll put it in the top 5.