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

[SebastianR]

On topic:

View attachment 404210

Take a look at Ihor Dusaniwsky's graph with black lines and black-ink data added by me to reflect his text estimates of short-selling (as well as clarify which days of the week are associated with the rapidly-climbing short interest).

[...]

I get the rise on Thursday and Friday. It's the first part of the week that puzzles me in terms of TSLA's resilience. Right now I suspect a white knight but would love to hear your view.

Sadly, I'm much more of a cynic than you: I fully suspect the likes of GS & Co. to make sure that they can get their money's worth in the capital raise. I also expect TSLA to continue to go up for a few more days. With a bit of luck we will even see a moderate short-covering rally because of it. I guess these guys are happy to milk both longs and shorts: since longs have no suffered long enough and we are a bit at a bottom + Tesla just threw more money at them (and it was not a gigantic raise - so who knows? Maybe Tesla is doing another raise in the fall?!?) - I guess it is now time for the whole circus to back up and maybe the shorts are now going to suffer? (<= this all is wild speculation, handle with care!).

Am I right in the assumption they got essentially a call option at their hands now? If they can unload their shares at $300 they will have made a killing, right?

With this, am I right to assume we have the following three scenarios:
1) White knight
2) Market maker (going back down after capital raise)
3) Market maker (achieving short-covering rally, with moderate swings until Q2 deliveries)
(of course there is always the "OMG - something happened, let's tank the share price" option out of the blue)

Off topic:
On FSD injuries. Our elevator broke someone's arm the other day (hard to believe this still happens but it did). Yet there were no calls to re-instate a lift boy in our building. Similar stuff will happen with FSD over time. The question will also be what the first FSD accident will be. A mechanical break failure in an FSD car might not be news worthy, a camera failure might be more difficult to accept, a software error classifying a child as an empty plastic bag and thus going full throttle will be devastating news in the media).
A friend of mine works at an insurance company. He said the moment the insurance company knows FSD is less prone to accidents it will be pushed by the insurance companies. The problem with Teslas right now is that Model S / X are very complicated / expensive to repair: they might be more safe with regards to deaths and serious accidents but the service / repair situation we all are suffering makes current Tesla insurance very expensive as the bulk of the damages are minor accidents / break-in / scratches etc. Some insurances in DK are reacting to this by asking massive deductibles and excluding the glas. I hope that Tesla can resolve the service / repair bottlenecks soon and certify more work shops, so we all can have cheaper rates.

 

[RobStark]

Weekend O.T.

Chinese Knockoff Copycat Cars ( some BEVs too)

 

[Starno]

Because it IS a lie.

It's not a lie.
But I understand why people might think that. It comes from a misunderstanding of the development of this tech.
A lot think it's about "programmation", they think the software dev are basically writing code for the car to operate in different environments.

It doesn't work this way. They're not writing any code, they're building a Neural Net, and then training it by feeding it data. Then they correct the NN by watching how many times it did the right thing or wrong thing. The Neural Net adjust itself.

The most basic way to think how a Neural Net is working in the car is basically : there is a straight line, and then a turn. The computer (car) will drive, and when the turn comes, it goes straight ahead and doesn't turn. The developers are just going to point to the Neural Net that it was bad.
Next time, the computer drive, and then instead of going straight ahead, it will turn in the wrong direction. The developers are just going to point to the Neural Net that it was bad.
....
Until the Neural Net does the right thing.

It's called Reinforcement learning.

 

[kbM3]

Tesla revealed some interesting specs on Semi reveal night. From F=MA, it takes 1,200 hp (at the wheels) to accelerate 0-60 mph in 20 sec at 80,000 lbs (see link below for calc):

Acceleration simulator​

Using the calculator in the link above, that weight and 0-60 mph time yields this hp figure:

• 0-60 in 20 sec @ 80,000 lbs: 1,200 hp

View attachment 404194

Wikipedia lists 283 hp in its specs for the RWD Model 3. Well, perhaps at 50% SOC that might be true, but dyno-testing at 80% SOC has demonstrated 360 hp at the wheels in a new 2018 LR RWD.

So we can easily rate the Semi at 300 hp per motor to obtain 1,200 hp for the Semi. Let's plug in some more numbers into the calculator:

• 0-60 in 5 sec @ 1,200 hp: 19,400 lbs

Further, it would be no problem to obtain 360x4=1,440 hp from the Semi via software. Future proofed.

Regen ability is primarily limited by the battery. But at 2 C burst charge rate, even the 600 KWhr version of the Semi should be able to accept 1,200 KW of regen, which is equivalent to 1,600 hp and near the limits of the motors and electronics.

TL;dr The Semi is likely set to produce around 1,200 hp, and weighs about 19,400 lbs empty.

Cheers!

Great news! That means it doesn't weigh much more than a diesel truck (15-20k lbs is what Google tells me). One of my biggest concerns about the semi was that the battery weight would hamper cargo capacity under GVWR.

Indeed, this is wonderful sleuthing. My short research also indicates 20k lbs. is right in the target area for a traditional tractor.

Also this corroborates Jerome’s stance that they are targeting the same payload capacity as diesel semi’s.

 

[kbM3]

This should be an internal deadline, not one for the media and investors. All it does is setup a (99% likely) "fail" situation for Elon and perpetuate the "forever over-promising" narrative.

I overstate it a bit, bit that's exactly what the MSM, bears and shorts will do, they love these forward-looking statements, easy wins for them.

Elon’s propensity is to give impossible deadlines both externally and internally and he has done this for decades. I believe he thinks the employees would not treat an internal deadline that is tougher than the external one with the same urgency.

Cons of public hyper-optimistic deadlines:
1) Stressful for employees
2) Possibly shortcuts are taken to hit deadlines
3) Stressful for investors.
4) Reduces Elon’s credibility.

Pros:
1) Employees put in tons of unpaid overtime.
2) Employees come up with stunning innovations. E.g. lessons learned from the impossible 5k / week by 12/17 deadline may have caused wasted effort and capital expenditures, but building the tent may have created innovations that will be replicated over the next dozen Gigafactories.
3) New research indicates employees (especially top caliber ones) are motivated by impossible deadlines. E.g. Getting to Mars in 5 years (or full autonomy next year) inspires way more than getting to Mars in 20 years or full autonomy in 8 years.

I submit that Elon understands the pros and cons very well and has judged that the pros outweigh the cons. In fact I believe it is a key factor in all of his companies successes.

Do you really believe Elon has operated for decades in an unwise fashion?

 

[avoigt]

Earl of Frunkpuppy on Twitter

I lost confidence in the past that we will see a short squeeze but instead of covering those guys are doubling down on a level where I rather buy stock ( and did at $233) and ask myself what will happen if another positive news come in combined with larger buyers moving in.... we never know it may happen or not.

The situation looks right now positive for an upswing at least. Bad received Q1 numbers are out and factored in, Q2 can only be better, cash issue is off the table and demand seems to be the last argument shorts can focus on and demand is about endless

BTW, not sure if that was discussed here as I am unable to keep up with this treat but VA is now followed by Elon. Quite an achievement and well deserved. I applaud it!

Just returned from a 1,350 km 1 day trip with my Model 3 through Germany 97% on NoA and all I can say is that this car is awesome. 13 Test drives in the last 6 days all all w/o exception want one.

Thats what I call demand.

 

[Tslynk67]

I've talked to people in the industry. They don't think it's an impossible deadline.

Maybe it is, maybe it isn't, but better to give the outside world a conservative timeline and then beat it.

 

[Pras]

On FSD accidents, (as I think I am a safer driver than most ), I will be looking for two cases when riding the robotaxi.

1) Personal injury / fatality: If Tesla FSD is significantly safer than other car, say 10 times less, resulting in serious personal injury (hospitalization, broken bones etc, or fatality), they will be more acceptable. This includes the car hitting a bystander or pedestrian.
2) Cost on insurance: Tesla insurance doesn't penalize the driver (or owner) for the accident done by FSD.

So accidents are OK as long as Tesla minimizes the above two impacts.

 

[Pras]

Earl of Frunkpuppy on Twitter
Just returned from a 1,350 km 1 day trip with my Model 3 through Germany 97% on NoA and all I can say is that this car is awesome. 13 Test drives in the last 6 days all all w/o exception want one.

Thats what I call demand.

View attachment 404239

I strongly believe that the real demand for Tesla will start now, once people see more Model 3s on road, find that it is OK to buy electric cars, that their neighbors have it, then the more sustainable, deep entrenched, demand will come. This phenomenon is already there in California but not in the rest of the world.

Just last week, a guy was talking to me and I explained how good Model 3 is. He later came to me saying how much he is regretting that he didn't buy Model 3, having bought BMW x3 recently. He did buy the TSLA instead.

 

[AudubonB]

Some thoughts on what happened lately.

1. Is it possible that Saudi's sold their 4.9% stake? They had a protective hedge on their investment for below $347 I believe. Couldn't they use their hedge, sell all their stock during Q1 in the upper $200's, then buy them back for an easy ~30% profit?

2. The Q1 model 3 margin maintaining at 20% is astonishing given the multiple price cuts, the introduction of the 35k and 37k SR+ lowering ASP, and the extra expense incurred for shipping to Europe and China. That's a much, much better improvement in manufacturing cost than I expected. I look forward to seeing Q2's amazing margins.

3. Here's an interesting thought. What if Tesla's deal with FCA isn't all cash? It is arguable that Tesla doesn't need cash, but manufacturing capacity. It's Europe, there's no way GF4 can be built anywhere near as fast as China, but we do know Tesla needs a Europe GF4 ASAP. Is it possible that Tesla negotiates some sort of factory takeover deal to turn it into GF4? That would be worth much more than a straight cash deal for Tesla

#1: No entity that amasses a stake above 5% can alter that stake without filing prompt disclosure forms demonstrating the change. This stricture remains in place as long as the 5% threshhold is not breached. Even were the Saudis to say "Pffft" on the rules, the actuating partners - brokers, agents, clearing houses and so forth - would not for a femtosecond, not for an attosecond consider not having the disclosure forms properly filed.

#2. That is, indeed, magnificent.

#3. Not only is that an appealing idea, but I'm thinking it could be a means by which FCA could very neatly shift some of the burden off their income statement and on to the always more opaque balance sheet. The more I think about that, the more it appeals. I wonder what some candidate locations could be?

 

[Fact Checking]

Just returned from a 1,350 km 1 day trip with my Model 3 through Germany 97% on NoA and all I can say is that this car is awesome. 13 Test drives in the last 6 days all all w/o exception want one.

Thats what I call demand.

Yes, and I think Tesla timed the EU introduction of the Model 3 perfectly: Christmas time opening of the new orders and slow start due to logistics, but still gobbled up to the last unit due to pent-up demand. Then spring time and summer time builds up demand based on first wave owners like yourself, and these are the two seasons when European carmakers typically introduce new models as well - and the cars are selling themselves. Also gave Tesla a bit more time to convert all the SuperChargers to the new connectors, etc.

Even though the timing is probably entirely accidental (Tesla had to start EU/China ramp-up roughly when the first waves of U.S. demand were exhausted - starting the global rollout wasn't discretionary), it's nevertheless near perfect market introduction timing IMHO.

It's also good that Tesla tries to smooth the delivery wave with the newly raised capital: "end of quarter delivery madness" is not something regular European car buyers know and tolerate. If in Germany a new car isn't perfectly detailed at delivery due to a peak wave that Tesla delivery staff cannot handle it's a problem.

 

[Fact Checking]

#1: No entity that amasses a stake above 5% can alter that stake without filing prompt disclosure forms demonstrating the change. This stricture remains in place as long as the 5% threshhold is not breached. Even were the Saudis to say "Pffft" on the rules, the actuating partners - brokers, agents, clearing houses and so forth - could not for an attosecond consider not having the disclosure forms properly filed.

Wasn't the Saudi stake slightly below 5%, for this exact reason? I.e. they could have reduced their stake from 4.8% to near 0% without having to show their cards.

But, with their hedge, the better strategy for the Saudis would be to unwind their hedges only - they are probably separate instruments (put options with a $350 strike price), marketable separately. I.e. the Saudis de facto shorted TSLA via their hedge at around $350, and now is the time to unwind that short position.

 

[AlMc]

#3. Not only is that an appealing idea, but I'm thinking it could be a means by which FCA could very neatly shift some of the burden off their income statement and on to the always more opaque balance sheet. The more I think about that, the more it appeals. I wonder what some candidate locations could be?

Tychy, Poland

 

[Creekstalker]

His team and the board appear quite happy that he is testing the latest development versions himself,

Shortsville Times: Tesla Board of Directors Approve Musk Suicide

 

[replicant]

FYI I do have some TSLA, about 8% of my net worth. What would a bullish investor put in as a % of net worth? 10%? 50%?
10% seems like a % that is material and can move the needle, yet still allows for decent diversification, yeah?
Is there a rule of thumb (for casual investors)?

TSLA represents 33% of my net worth (or 90% of my non-real estate worth). This ratio has been stable over the past 5 years, as I keep buying TSLA shares at market price (every time I have some liquidity). I intend to keep it that way until the vast majority of people I know say their next car will be a BEV or that they won't purchase cars anymore b/c of electric robotaxis.

 

[AudubonB]

Wasn't the Saudi stake slightly below 5%, for this exact reason? I.e. they could have reduced their stake from 4.8% to near 0% without having to show their cards.

But, with their hedge, the better strategy for the Saudis would be to unwind their hedges only - they are probably separate instruments (put options with a $350 strike price), marketable separately. I.e. the Saudis de facto shorted TSLA via their hedge at around $350, and now is the time to unwind that short position.

I responded above without pondering what their position had been, other than also stating the importance of the 5% threshhold. You are right, of course, in stating that anything below 5% need not be revealed.

 

[Tslynk67]

dang. MBSp blocked me on twttr

Me too! After years of ridiculing him, I always wondered what took so long.

If you still want to read his drivel then just use another browser without signing into your account.

 

[shootformoon]

Get a broker with a corporate bond desk, they can get any of the convertibles for you. You will have to use the telephone.

Note that you *cannot* get the 2025 non-convertible bonds, only institutions and foreigners are allowed to buy them.

P.S. The bond desk will laugh at you if you want to buy less than $100,000 worth -- it's not worth their time.

This is the part I do not understand. Why tsla does not offer c

SR + worldwide deliveries + leasing were all part of the plan to get to 10-15k /week.

You don’t find it discouraging that they’ve also reduced prices and added other incentives at 6k /week?

I don’t buy the good will argument. Not with cash being so precarious. That would be irresponsible timing, wouldn’t it?

I think we all miscalculate the consumer awareness development curve. The reason it is not 10k-15k stable demand is not because consumers have absolutely better options but most of them simply do not understand tesla.

 

[dc_h]

There was a driver at the wheel not paying attention. Different situation.

FSD will recognise pedestrians and would have avoided this collision if physics permit. If that is not the case, FSD is not ready for driverless operation.

The pedestrian basically stepped in front of the car at the last second. I don’t think Waymo software or the driver were at fault.

 

[heltok]

Maybe it is, maybe it isn't, but better to give the outside world a conservative timeline and then beat it.

What do you prefer?
A) Elon saying 12months and delivering in 24months
B) Elon saying 24months and delivering it in 30months
C) Elon saying 36months and delivering it in 36months

Because deadlines will determine how hard the teams are working. I as investor is very happy with Elon doing A, the shorts will claim that they were right and that Elon is a fraud, let them. What matters in the end is profit, not accuracy of predictions.