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

[Hock1]

to end the discussion re uptick rule once and for all:

View attachment 365424

Thank you. That's what I was looking for.

 

[MarcusMaximus]

What cars got knocked out?

All of them that were registered before January 1, 2017.

 

[MarcusMaximus]

And in other news....

Once again GM totally fails at strategy.

https://www.cnbc.com/2019/01/02/gm-hit-200000-us-electric-vehicles-sold-in-2018.html?


Total preventable fail IMHO

Could be part of a different strategy: use it as a cudgel to push for new legislation extending the tax credit.

 

[Heimdallr]

How exactly would GM prevent independent dealers from selling cars they have in inventory?

Exactly. The dealership model is doomed. Or as Musk says, even if the only thing Tesla does is reducing time from factory to the end customer, they will win.

 

[shrspeedblade]

What cars got knocked out?

My 2016 Volt was getting knocked out, along with similar cars. I believe the older Model S were as well. They updated the sticker requirement.

From DMV website:

Red decals expire on January 1, 2022 and are now being issued by the California DMV to qualifying vehicles that have not already been issued White or Green decals. There are income requirements and other details regarding this new California Clean Air Vehicle (CAV) decal program.

Qualifying vehicles issued a Green or White decal on or after January 1, 2017 will be eligible to apply for a Red decal. Vehicle owners issued White or Green decals on or after January 1, 2017, who are eligible for the Red decal, were mailed, to their address on file, a pre-filled CAV decal application form with instructions and a return envelope from DMV. The pre-filled applications were mailed by DMV in mid-October 2018.

If you believe your vehicle is eligible for a new Red decal and you did not receive a letter from DMV, please submit a completed CAV decal application form (REG 1000) to DMV for review.

If your vehicle was originally issued White or Green decals prior to 2017, your vehicle is not eligible for the Red decal and will no longer be eligible to participate in the CAV decal program after January 1, 2019.

 

[Hock1]

Ihor Dusaniwsky on Twitter

Thanks for the info, but I'm inclined to rely on my decades actually in the industry than a commentator I've never heard of.

 

[mongo]

For those outside of CA, I wanted to share a reply to someone in SoCal who thinks the market is cratering.



Many reasons why someone cannot close a deal even at the "best timing".

-Existing leases
-Waiting for tax refund
-Winter drags down car sales as a whole
-Not everyone knows about the intricacies of the tax credit
-240 million people in the US, DO NOT follow Elon Musk on Twitter
-Only lease cars

YMMV but with an INCREASE in utility incentives, Model 3 is effectively $1,250 more expensive on Jan 1st than it was on Dec 31st for your particular market.

Really not consequential big picture.

Millions of cars just got knocked out of the carpool lane in California as well. Whats the best car that will let them back in?

And Tesla is shipping out of country starting now anyway, so US Q1 demand is less important. World demand was not pulled forward by the EV credit at all.
(plus SR is coming, at volume (meaning extra line capacity turns into profit)

 

[MP3Mike]

What cars got knocked out?

All of the ones with the old stickers. (Regardless of if they are a Tesla, Volt, Prius, etc.)

 

[Tslynk67]

are you sure it hit it?
i'm closely looking and nothing i see more than -8% or so, not -10%

Yes, previous close was 332.80, less 10% is 299.52 and today's low (so far ) is 298,80

 

[MXWing]

What cars got knocked out?

Every PHEV and BEV purchased before 2017 that got White/Green sticks are now not eligible for the carpool lane. Ok, I threw in too many numbers but its still VERY substantial:

"Nearly 224,000 solo drivers stand to lose their green and white carpool stickers — permanently — on Jan. 1 in a seismic shakeup of the rules governing diamond lanes."

What is the tax rate in California? 8%? Wouldn't that drop the effective cost increase down to $1,090?

I didn't account for sales tax and registration trickledown! Minimum tax rate is 7.25% Though most areas where Tesla has a presence is 9.25%-9.50% State + County + City.

 

[Zaxxon]

Tesla Ultra Bear Irrationality
"

Tesla Ultra Bull Irrationality

Everyone else: Finds wall. Bangs head into it.

I was all ready to write a fun reply to this, and then I saw that @KarenRei beat me to it... It really is remarkable--'they can't produce enough to be profitable;' 'the cars are still far more expensive than promised;' 'demand is cratering.' Yet Tesla continues to produce more and more, and the entry price continues to close in on $35k while profit margins rise. Are they producing what they want to yet? No. Are they selling a $35k car yet? No. But the writing on the wall couldn't be clearer.

I'm very sick so I may disappear if I go into the hospital. But anyway...

I 'liked' your post, but not for this part. Best of luck, and may your current health issue resolve itself without hospital visits needed.

Elon is probably saying “WTF” too.

But I look at this is an opportunity to buy more “cheap” shares. Yup.... ultra bull here.

I prefer to see the positive in hard work. Shorts like to tear down hard work to make a profit. I realize it’s still spin either way but I feel like it’s immoral to want to discount someone else’s hard work.

This. Putting aside all the noise about whose estimates were best, what was hit/missed, where demand might be strongest or waning, here's the bottom line: Tesla is in a hugely capital-intensive industry with an incredible barrier to entry, and they have much more than the normal barriers since they chose the novel, never-produced-in-volume powertrain rather than ICE with its established powertrain manufacturing base. And yet, here are their production numbers:

2012: 3,100
2013: 22,477
2014: 31,655
2015: 50,580
2016: 76,285
2017: 103,181
2018: 245,240

That's a 6-year CAGR of 107%. Excluding the huge (relatively speaking) jump from 2012-2013, it's 61% CAGR over five years. Shrinking the time-frame further results in the CAGR rising each time, to the 1-year growth rate from 2017-2018 of 138%. If they make absolutely no improvements in 2019 and simply continue at their Q4 run rate of 90k, that'd be 360k vehicles for the year, a 47% growth rate. Maintaining annualized growth of well over 50% in an industry as harsh and capex intensive as this one does. not. happen.

During the time of this growth, Tesla has expanded their product line and greatly increased their in-house manufacturing knowledge base. They have far-in-development products that will further expand their line and allow them to continue reducing the costs of their most expensive components.

I'm buying.

 

[saniflash]

wow, just wow how calm the stock is without short selling. just sideways. boring.

 

[Chickenlittle]

Jesus, 24 pages already? I'm not catching up this time.

I'm very sick so I may disappear if I go into the hospital. But anyway...

...I thought the delivery report was great. It was on the high side of my expectations.

The price cut was a mild surprise, but to me it indicates improving margins. I'm guessing those improving margins are mostly on elements present in the base model, so that's $2000 of the $3000 they were trying to cut out of the cost of the base model -- the rest will probably come with the new battery pack design.

Wall street is reacting like complete idiots, as if this extremely good delivery report was a negative. I will probably do some cash shufflin' to make sure I can execute my options.

Sorry to hear your health issues. I too thought report was great but also expected price decrease with tax credit change. No mention on forum of increasing residual value on EVs will make leasing option a real boost. Wishing you a rapid recovery

 

[MarcusMaximus]

Every PHEV and BEV purchased before 2017 that got White/Green sticks are now not eligible for the carpool lane. Ok, I threw in too many numbers but its still VERY substantial:

"Nearly 224,000 solo drivers stand to lose their green and white carpool stickers — permanently — on Jan. 1 in a seismic shakeup of the rules governing diamond lanes."



I didn't account for sales tax and registration trickledown! Minimum tax rate is 7.25% Though most areas where Tesla has a presence is 9.25%-9.50% State + County + City.

Slight correction: you need to have been assigned the sticker prior to Jan 1, 2017. I bought my S on December 30, 2016 and got my red stickers.

 

[Alphacrux]

>75% were non-reservation-holders. That doesn’t sound like a drop in demand. The incredibly low level of inventory also suggests that they’re still selling every car they can make; still production constrained, despite higher levels of production and shrinking supply of reservation holders(in the US, who wanted long range).

But isn't it a drop in demand for the higher-priced versions? In fact, didn't Elon anticipate this when he came out with the Lemur (MR)? thanks in advance..

 

[Tslynk67]

Indeed, great results!

First, let's look at inventory, the final bastion of the much-mutated 'short thesis':

• Inventory is comparable to Q3, because the reduction in inventory due to delivery optimizations were breathtaking: in-transit vehicles dropped from 11,824 in Q3 to just 2,907 in Q4.
• In particular S+X inventory dropped: in-transit vehicles dropped from 3,776 in Q3 to 1,897 in Q4, which is a delta of 1,879 - and Tesla delivered 27,550 while they produced 25,161, a delta of 2,389 units, so the net unsold inventory went down by about 510 units, which should improve cash flow by about 50 million dollars.
• Model 3 inventory: deliveries reduced inventory by -1,756, while vehicles in transit went from 8,048 to 1,010, a reduction of -7,039 - the net increase in unsold inventory is 5,283 units, about a single day week of production. Cash effect is about a $210m reduction of cash flow.
• The net inventory effects from the S+X and 3 changes should thus be around $150m only. The effect from the Q3 weekend ending cash flow delay alone should offset that. I.e. the 5k in finished goods Model 3 inventory is a nothingburger.

In fact I'm pretty confident to predict that Q4 financials should be even better than Q3 financials:

• The 63.1k Model 3 and 27.5k S+X deliveries are predicting fantastic Q4 financials as well: in excess of 7 billion dollars of revenue, $1.5b operating cash flow, close to a billion dollars free cash flow. 7.5-8.0 billion dollars of revenue and 2 billion dollars operating cash flow is not out of question either.

With these figures, is it remotely possible that 2018 becomes profitable as a whole?

 

[MarcusMaximus]

But isn't it a drop in demand for the higher-priced versions? In fact, didn't Elon anticipate this when he came out with the Lemur (MR)? thanks in advance..

Maybe, maybe not. Have to wait and see the ASP in February. At any rate, as I remember, margins are roughly the same on the Lemur as they are for the long range(non-performance), so including them in the mix doesn’t really hurt Tesla, especially given that they got rid of the RWD long range.

 

[MXWing]

Reuters - today: GM sold 200,000 electric vehicles in U.S. by 2018, triggering tax-credit phaseout: source | Reuters

Graph courtesy of Chevy Volt FB Owners Group

 

[EVNow]

Thanks for the info, but I'm inclined to rely on my decades actually in the industry than a commentator I've never heard of.

Only MMs can sell short naked - but they can't take positions according to Volker rule. That's why we don't see much short selling.

In any case, since there are millions of shares available for borrowing it would make no difference either way.

 

[thx1139]

All of them that were registered before January 1, 2017.

From my quick list it appears people can apply for a new sticker. Did any cars get dropped of the eligibility list? Or am I reading something wrong?