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

[anthonyj]

In 15 years, when EVs are the only type of cars for sale, Tesla will be around. Not making cars. But supplying batteries for 10s of millions of cars. Autopilot and other tech will be leased out. You’ll all see.

 

[printf42]

So you don't refute that e-tron will be able to charge more cheaply per kWh at higher kW stations, where available.

As JB said in one of the earnings calls, Tesla is striking the balance between charging time and battery longevity, with the best chemistry they can find, there is simply no better chemistry that can be mass produced now.
With the same chemistry you can target faster charge rate at the cost of longevity, that’s not tech advantage, it’s just business choices, Tesla is not doing it doesn’t mean they don’t know how to do it.

 

[AudubonB]

I have a couple of Q1 thoughts that might act to mitigate what otherwise might be a slightly pessimistic result:

1. If Tesla acts has it has done in past quarters they'll probably shift as much as possible to NA sales during the period after probably EOQ deliveries in China and Europe. The inventory thus might not bloat as much as expected.
2. The huge demand lever would be a refresh S and X plus SR Model 3. Given commentary in other threads and external comments/evidence? Both of these are reasonable assumptions later in Q1. Both depend on major efficiency improvements and technology advances, of course. In the past events of taht type tended to happen without clear notice, but with substantial hints. Those are happening right now.
3. Given Tesla track record thus far there may well now be major financial institutions prepared to initiate large-scale Tesla leases that would not force Tesla to assume risk under FASB 842/IFRS 16. My US sources in the auto leasing world (there are several) all are working on approaches to do just that right now.
Please understand that, if my sources are correct, there will be zero direct manufacturer involvement other than dealer or distributor entity lease origination processing (BTW they anticipate processing exactly as third party POS originated external leases are done today). That requires that the bank (to my knowledge there are three major auto lending banks working on this now) will use a very different risk profile than has been the historical norm. Skipping the details:
later in Q1 leases to high-credit-quality business users are quite likely to be offered for S, X and 3. Tesla already places some loan paper with each of these entities, with zero recourse to Tesla. If that happens we should see substantial marginal sales in all three models in the US.

It seems to me at least two of those three items will be materially beneficial, and all three might well make Q1 surprisingly good.

The trick is trying to quantify any of these, or all of them. I have strong views, but am ill-inclined to share them lest somebody thing there is more factual basis than actually exists. I would not bet on my own SWAG, even though I am long TSLA.

In trying to digest - with the appropriate discounting for what you carefully write includes unsubstantiated theorizing - this post, it occurs to me that you might have some insight as to the differences in business-leasing of autos in the US and in Europe...potentially carving out UK 'cuz of you-know-what and also of Germany because of its massive potential in that field, and the ramifications for Tesla.

 

[Fact Checking]

Hmm? Arithmetic suggests +$406m for Q4 + Q1 (average of +$203m per quarter).

Indeed - not sure how that typo happened - if @ReflexFunds's updated estimate for Q4 is accurate then +$229m for Q1 would be sufficient. The other points remain.

Mod-fixed the original post

 

[lklundin]

Oh - you haven't met a specific kind of Germans yet... In order to qualify for German EV incentives the Model S in Germany had to be below 60k Euro. So Tesla produced a special version of the Model S which had a base price just below the magic threshold. It was so crippled that everybody thought that nobody will buy it. But some Germans tried to buy it...

On that note I will point out that (in spite of my warning to Elon Musk's twitter account...), Tesla Germany has stopped selling the 75 kWh Model S, so at this time buyers of the Model S (100 kWh) will not qualify for the subsidy.

So I am really quite curious how Tesla will proceed with their Model S versions.

 

[kyzhk]

So you don't refute that e-tron will be able to charge more cheaply per kWh at higher kW stations, where available.

Problem is that it doesn't scale.

When/If Audi electric cars reach the scale of Tesla, they would not be able to provide faster charging at lower cost. You may want to read up on demand charge and understand the inherent scaling issues. They would only be able to do so at a tiny volume where they can afford to lose money.

Battery longevity at different C rate is also a problem. If we assume that audi is just using commodity lithium ion battery supplier for their batteries, they will likely see rapid deterioration at high C rate.

 

[AudubonB]

Tesla announces earnings call date! January 30th. Seems pretty early! Thoughts on what this could mean?

Tesla Announces Date for Fourth Quarter and Full Year 2018 Financial Results and Webcast | Tesla, Inc.

That they've found a direct link to the Oracle?

 

[KarenRei]

So you don't refute that e-tron will be able to charge more cheaply per kWh at higher kW stations, where available.

Sure, if you ignore literally everything I wrote, absolutely! Let me just pop on over to my local nonexistent CCS v2 station and connect it. Then once I've gotten a full charge (let's be whimsical for your sake and pretend that amount one charges at DC chargers is any meaningful fraction the total), let's totally ignore how much more energy I burn per unit distance (the more Wh you burn per unit distance, the more you need to pay for). And lastly let's completely ignore how for low volume demo / compliance cars, all issues of profitability (including warranty costs on your batteries for charging them at high C rates) can be thrown out the window.

Furthermore, you want to compare charging station prices? Electrify America is 35 cents per minute *CCS v1*. Not v2. CCS1 maxes out at 70-85kW for real-world vehicles (e.g. Kona 70-75kW, IPace 85kW, etc). Let's go with the IPace's 85kW to be favourable to it. And let's (falsely) pretend it never tapers! That's 1,4kWh per minute. That's 25 cents per kWh (plus 1kWh extra per session, aka an extra 4kWh), which is more expensive than the Supercharger network in most of the US. But then you go and burn 50% more kWh per unit distance in the IPace!

 

[KarenRei]

But to reiterate, charge prices are a giant red herring, because unlike with gasoline vehicles, most EV "fillups" are done at home. Almost nobody does most of their charging at DC chargers.

 

[adaptabl]

In 15 years, when EVs are the only type of cars for sale, Tesla will be around. Not making cars. But supplying batteries for 10s of millions of cars. Autopilot and other tech will be leased out. You’ll all see.

Funny on so many levels.

 

[CorneliusXX]

That they've found a direct link to the Oracle?

Old news. Larry was appointed ages ago.

 

[Fact Checking]

So you don't refute that e-tron will be able to charge more cheaply per kWh at higher kW stations, where available.

Wow, what a tone-deaf reply from the troll!

True historic photo of me waiting for @KarenRei's reply:

Her reply:

Sure, if you ignore literally everything I wrote, absolutely! Let me just pop on over to my local nonexistent CCS v2 station and connect it.

 

[lklundin]

Here is a good idea for an article - all the EVs that VW and others have announced but never built (or how much longer they took compared to when announced).

For eg. in 2011, Ghosn said Nissan will soon have 4 EVs. Still waiting after 8 years.

He (or those pulling the strings) already had that idea, worded in an SA piece - with 100 BEV models to come, each a Tesla Killer.

 

[EVNow]

Trump to offer shutdown-ending immigration deal, still wants wall money - source

So, protection for Dreamers in exchange for $5.9B for wall.

Funny thing is 2 years back, Dems offered $29B for border security in exchange for DACA - that Trump rejected. The great deal maker that he is - he is now making a counter offer of DACA for $5.9B.

Would be interesting whether Dems will take it. I think this deal would have large support among Dem base.

 

[MarcusMaximus]

For Autopilot functionality that will almost certainly be the case - there will be no significant difference between HW 2.5 behavior and HW 3.0 difference.

The code and data format and flow will be different: the networks and their inference calculations (i.e. using the trained network) will be translated to a brand new CPU's instruction set and data layout, which is (radically) different from Nvidia GPU's instruction set and basic data types.

The new hardware is (much) faster - but both solutions will probably be clocked to 60 or 100 FPS so there will be very little difference to the vision attributes that the actual high level self-driving software gets - which code runs the same ARM code.

At least that's how I expect it to work.

You can only run a forward pass on a neural network if you have input to put through it. So I’d expect it to cap at the cameras’ framerates.

 

[EinSV]

@Anton W @KarenRei et al

It is a time-honored tradition on TMC that almost every new short seller who shows up here wants to derail the main investor thread with their pet issues, which usually already have been discussed to death.

On that note, could we please move the BEV "competition" discussion to the dedicated thread on that topic:

Tesla BEV Competition Developments

There are also several threads specifically on the Audi e-tron.

 

[Bet TSLA]

I can personally name dozens of sales in my area which didn't happen

Why should Tesla care as long as they can sell every car they can make at a price that they want?

 

[MarcusMaximus]

Absolutely crushing info on supercharging speeds of the e-tron:

Audi e-tron Documentary: development & production

Combined with this analysis, going to make it hard for buyers to choose Tesla vehicle over E-tron if they care about charge times and cost.

Oh, and that's before Tesla just upped their supercharger prices even further.


Tesla needs to release V3 superchargers soon to maintain demand

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Caveat lector, all. As always.

Going back to this, something is missing from your analysis: the capacity of the battery and range(therefore, miles/kWh). The actual miles of range/hour of charging the eTron is roughly similar to that of my Model S 75, even at that faster 150kW speed(which is available basically nowhere). And dramatically slower than any of the currently available Model 3’s.

Unless people are charging their cars solely for the purpose of using them as a backup battery, that rate is the only one that really matters.

Once they actually get such chargers up and running in places people can go to, they’ll have finally caught up with Tesla circa 2016 re:charge times.

 

[azaz]

It’s temporary Daca protection without any pathway, that’s not the deal Trump agreed to before

 

[KarenRei]

It’s temporary Daca protection without any pathway, that’s not the deal Trump agreed to before

Dang. No shutdown end now.

It'll come eventually, though