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

[EVNow]

They don’t. As long as they are selling all they are making they don’t need to advertise.

But at what ASP ? I bet the avg ASP improves when they educate people.

ps :

I think shortly after Advanced Summon drops Tesla goes back to a month + waiting list to get a car.

Yes, once advanced summon or more probably NOA on city roads comes to fleet, there will be uptick in demand. But with China GF coming online, to fully utilize 7k/wk production capability in Fremont they need to start small scale wed ads now - may be one Mil a month, nothing extravagant. At $1 / click, that will be about 1 Million clicks which should lead to quite a few additional sales - 10k at 1% conversion, for eg. Having that extra buffer of 10k orders a month would be more than worth $1M.

How Much Does Google Ads Cost?


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[DaveT]

I believe you’re not fully accounting for the innovations, harder work, inspirations and unpaid overtime the outlandish goals bring.

In other words, if Elon stopped the outlandish goals, creativity, productivity and innovation would all go down and costs would go up.

You can have outlandish goals for internal moonshot projects. That's fine.

But there are plenty of companies who give conservative guidance yet are able to motivate their employees to be creative, productive and innovative.

 

[anthonyj]

Looks like the press has decided it’s time to pump TSLA again:
View attachment 413280

They beat the piñata for so long and no more candy is coming out

The latest insanity from Anton Wahlman:
The U.S. Should Ban All Electric Cars in the Interest of National Security

I’m telling you this is peak dumbassery and means we are close to finding a bottom

 

[kbM3]

You can have outlandish goals for internal moonshot projects. That's fine.

But there are plenty of companies who give conservative guidance yet are able to motivate their employees to be creative, productive and innovative.

You’re that positive Elon’s wrong?

1) Internal goals do not work as well.
2) No other companies are as creative, productive and innovative as Elon’s. That proves our (mine and Elon’s ) point!

 

[tander]

I believe you’re not fully accounting for the innovations, harder work, inspirations and unpaid overtime the outlandish goals bring.

In other words, if Elon stopped the outlandish goals, creativity, productivity and innovation would all go down and costs would go up.

+1If the outlandish goals stop, they wouldn't be able to recruit the type of people that have got them this far, innovation would slow, and they'd have to change the business model.

You can have outlandish goals for internal moonshot projects. That's fine.

But there are plenty of companies who give conservative guidance yet are able to motivate their employees to be creative, productive and innovative.

True, to a degree, but it's the external moonshots attract moonshot type people and gel everyone together. Even the lowest paid person at Tesla can say they are working to save the planet and being part of the solution instead of just collecting a paycheck. And if you make them external, that puts everyone on notice from suppliers, to customers, to potential partner. Plus they get un-buyable amounts of press for free, whether they hit the targets or not. (Not saying Musk is the world's greatest role model or you shouldn't take him with a grain of salt)

 

[ZachShahan]

@ZachShahan Great article! Well done my friend. Damn glad to have you out there in the Cyber world, hope you get called in early August.

To quote Elon, "Yup."

Thanks. This is the best place for Tesla discussions. I'm sure soaking up too much frustration here helped push me to write the article.

Just so much nonsense in the world ...

 

[ZachShahan]

My only issue in the article is reference to TroyTeslike’s 74k delivery estimate. This is just an estimate for Troy and he has less data than Elon. So if indeed it goes to 74k vs 91k it is not an acceptable range of error.

Tesla has clear sight on 50k orders in 51 days, plus recent trends and inventory cars; hence the remaining 40 days expectation should not be off by 40% (24k bs 41k). I am hoping (and guessing) that Troy Teslike is being very conservative.

I know that @ZachShahan did it to suggest the buffer and blunt the shock effect if Tesla underdelivers.

Thanks. Well, 1) I'm trying to be cautious, 2) Troy has been superb in the past, 3) I've been overly bullish at times, 4) it is just a leaked email to employees, 5) better to have low expectations and be surprised than have high expectations and be disappointed.

But I have been debating what to do with Troy's estimate.

 

[JRP3]

You can have outlandish goals for internal moonshot projects.

How long do you think internal goals would stay internal?

 

[Carl Raymond]

“In addition to the Model Y, Tesla is planning on a full refresh of the Model S, which employees say will likely include an interior with the minimalist look and feel of the newer Model 3, the same drive units and seats used in the higher-end Model 3 and a battery that delivers 400 miles of range on a full charge.”

Too specific details. But I am guessing model S is anyway not selling that much. To push the current S, Tesla can always throw in supercharging and FSD. Wouldn’t hurt margin much. Benefit of having software focus! I won’t mind 370 miles range over 400 if I get freebies. So I wouldn’t worry too much about sales.

There are many who will rush to get the classic look, because they don’t want their luxury S to look like the spartan 3. This is one occasion where I’m not concerned about Osborne.

One of my biggest near-term concerns now is the Chinese rare Earth issue - I have seen numerous articles reporting that the language in the Chinese press is threatening to cut off supply to the US as a next step in the trade war. This could be very bad for Tesla, especially as they have just switched to permanent magnet motors not only in the 3, but now also the front drive units of the S and X.

China has adopted Tesla. They will protect it. If Tesla needs rare earths, rare earths Tesla will get.

 

[anon]

CNBC has the full text of the e-mail: Read Tesla CEO Elon Musk's latest email urging employees to improve vehicle deliveries

In particular, this sentence is complete, rather than having a word missed out in the Electrek article (unless CNBC just guessed that this is what it means): "This makes it much harder for Tesla to break even."

 

[EVNow]

Last quarter, there were many expedite fees and routing inefficiencies that led to higher than expected delivery costs. This makes it much harder for Tesla to break even.

This can be interpreted in multiple ways. Break even on
- delivery fees to delivery cost
- Operating Profit
- non-GAAP Profit
- GAAP Profit

I vote for (1), in the context of the email.

 

[EVNow]

Last quarter, there were many expedite fees and routing inefficiencies that led to higher than expected delivery costs. This makes it much harder for Tesla to break even.

This can be interpreted in multiple ways. Break even on
- delivery fees to delivery cost
- Operating Profit
- non-GAAP Profit
- GAAP Profit

I vote for (1), in the context of the email.

 

[Pras]

Thanks. Well, 1) I'm trying to be cautious, 2) Troy has been superb in the past, 3) I've been overly bullish at times, 4) it is just a leaked email to employees, 5) better to have low expectations and be surprised than have high expectations and be disappointed.

But I have been debating what to do with Troy's estimate.

@ZachShahan
The thing about estimates and estimators is that they are mostly misses and sometimes hits. Many people including Meredith Whitney predicted housing crisis. But since then their forecasts have been at best average. So never depend on one forecaster.

In banking sector, that is why the macro forecasters depend on consensus data, and similar is the case for the analyst consensus when it comes to earnings. This is because most of the forecasts are going to be wrong, and hence it is safer to use an aggregate information so that your view is at least aligned with the markets aggregate decision. Again even consensus forecasts can be equally wrong.

As for this specific case, Troy’s method is based on data but he seems to be ignoring (or discounting) three points. One the TMC tracker data is showing very strong demand vs Q1. Second, he continues to ignore Elon’s now two emails. Third, the number of ships leaving US to China and EU are more likely carrying full capacity vs. limited capacity in Q1. This last point was indirectly made by Zach in the Earnings Call.

In the end, only time will tell and he may still be right. But it is better to depend on multiple source of data than one. Also if you hear from Elon as directly as he has said, the error margin should not be 19-20k. It most likely will be lesser.

 

[EVNow]

Third, the number of ships leaving US to China and EU are more likely carrying full capacity vs. limited capacity in Q1. This last point was indirectly made by Zach in the Earnings Call.

EU bound ships are consistently taking more time to load than China bound ships. So, they are definitely sending more cars per ship to EU than China. They are also sending more cars per ship to EU compared to Q1.

 

[jerry33]

I think that track mode has little to nothing to due with the pack design.

It should because track mode requires a lot more cooling capacity, which will change the pack design.

 

[Dan Detweiler]

Elon probably loves being on the conference calls. I really can't see him deciding not to participate, I really can't. Tesla is his baby, he likes to be a core part of it.

Just to be clear...if it comes down to it, SpaceX is Elon's baby. Not taking anything away from his dedication to Tesla, but he started SpaceX from absolute scratch. I think if he was forced to chose one or the other...he would chose SpaceX.

Dan

 

[jerry33]

(1) when you call, you get someone on the phone
(2) that person gives you accurate information, tells you when they don't know something, and knows how to find the right person to give you the information, and connects you to that person
(3) the person who does know the information calls you back and gives you accurate information
(4) delivery dates actually happen when planned
(5) bug reports actually get processed and addressed by the software team

1, 2, and 3 have always been fine for me.
4 was over six years ago, so anything I have to say about it isn't relevant.
5. Does need work.

 

[LJS22]

Tesla’s biggest advantage is Elon. Without him they would be forced to fall in line behind the rest of the established auto makers. Under the pressure he’s put this company in any other CEO would have stepped aside. But having Elon Musk steer this ship you know he’s going to do everything in his power to make it work. He has shown no give, and as much as the shorts love to mock him they know his persistence will likely be their undoing. The best thing for them would be to have Elon leave Tesla to someone else.

 

[jerry33]

I think when I show them my monthly savings and show them the inside they are sold. Plus electricity is fairly cheap in Texas. I have yet to see a spike in my electric bill.

It's basically a rounding error--even if you drive quite a lot.

 

[Artful Dodger]

Just to be clear...if it comes down to it, SpaceX is Elon's baby. Not taking anything away from his dedication to Tesla, but he started SpaceX from absolute scratch. I think if he was forced to chose one or the other...he would chose SpaceX.

Dan

Elon spends 90 hrs a week right now on Tesla. He's hoping to knock that down to 80 hrs by the end of the year. I don't think you choose between children, especially when they're both doing well and growing quickly.

Cheers!