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

[gene]

I have been unable to get this post out of my mind since I saw it the other day. Thank you for sharing Anne’s heartbreaking story. Although your grief is profound you have done everything you can to turn it into something good, both by going all EV, and by educating us to the dangers of fossil fuels. I will never look at the high price of gas in the same way.

Thank you for kind your words. I knew the pictures would be hard for people to look at, and for me as well. It was hard for me to see the ICU picture which I had avoided looking at for years.

In the years since Anne's death I have become very involved in various groups working against fossil fuels. The knowledge of the damage ICE does to children's brains, lungs, and hearts is available for anyone to learn. The most fun these days is being on the Ventura County Air Quality District advisory committee where a few of us get to decide how to locally spend substantial available funds on EV charging and infrastructure. Soon we will have VW money as well.

In my area there are a fair amount of local groups fighting fracking and off shore oil wells. But until now, they have never really pushed people to "nip-it-in-the-bud" and simply stop buying gas. I realize getting people's butts-in-seats of EV's for a test drive is the most effective way for people to make the move. I now have round up several EV volunteers to visit ICE drivers and give them at home test drives. These local environmental groups will now include a blurb in their newsletters of our "EV Drive And Learn" service. (Maybe some of you folks could do the same in your area?).

Back about my original post. A picture speaks 1,000 words. My looking at the pics again after a few years of avoiding the ICU picture reminds me why I do this work.

 

[Curt Renz]

Tesla (TSLA)

Börse Frankfurt – today’s closing:

Final trade at 18:50 UT (13:50 EST)
€269.50
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Closing Bid
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Volume 4081 shares

Börse Frankfurt closed at 19:00 UT (14:00 EST)

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Nasdaq - Friday:

Regular close
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After hours
$304.40

 

[MP3Mike]

OT, but just wanted to clear up any confusion.

The "adapter" is more of a second cable than an attachment to the primary CCS cord. So it's not inconsistent. Pictures: First look at Tesla’s new dual connector CCS Supercharger

No, you are confusing things. Tesla is doing two things in the EU:

1. Adding a CCS cable to Supercharger stalls so that the Model 3s can use them.
2. Creating a CCS to Tesla Type 2 adapter so that Model S&X can charge at CCS sites.

 

[mblakele]

Colour me confused, but why is it some days they register 25k, then other, 86 - what's the purpose?

Maybe that's the idea? To confuse observers.

 

[AcesDealt]

Thanks reflexfunds for the efforts on model 3 base cost. I also have trouble figuring out where 5k$+ comes out in a manner that I'm comfortable with and will rely on management guidance and some skepticism. I find this a significant enough variable that contingency planning the possibility that they stop at 40k$ or so seems reasonable to me. Of course they may lose 100k to 200k sales in that scenario but the marginal profitability lost would be rather paltry. Tesla steady state at 350k/year model 3 with 50k$ ASP and 25% gross margin is a perfectly fine result imo.

 

[Tslynk67]

That boat is now traversing the Caribbean Sea...

 

[Rogstar]

In my view the single most important development which will impact Tesla's earnings, volume and mission in 2019 is progress with reducing the cost of production of a base $35k Model 3.

This is what drives their ability to launch non premium and short range car options, which is the largest factor in whether Tesla can achieve sustainable demand of 7k Model 3s per week. This cost reduction progress is also what impacts their ability to maintain Model 3 gross margin above 20% and progress towards its 25% target.

Significant progress has been made in 2018, with a $29.1k reduction in average cost between Q1 and Q4 2018 on my estimates. Excluding the impact of spreading fixed depreciation costs over higher car volume, cost reduction achieved was $17.2k. I think Tesla likely exited 2018 with a cost of c.$37.5k.

Implied Tesla average COGs for a $35k base car:

• 1Q18 $67.6k ($53.2k ex depreciation).
• 2Q $49.0k ($42.3k ex depreciation).
• 3Q $40.1k ($37.4k ex depreciation).
• 4QE $38.5k ($36.0k ex depreciation).

To get to 25.0% average margin on my long term option mix estimates (50% EAP, 50% Premium interior, 50% US, 50% SR, 15% MR, 10% LR, 20% LR AWD, 5% AWD P) Tesla needs to reduce this cost by another $5.5k to $32.0k. Elon has previously stated a target of reducing this cost to $30k, which should correspond to an average margin closer to 30%.

Much of the easy work on cost reduction has now been done, so it is going to be a significant challenge to make further progress.
Roughly I think this $5.5k cost saving could be achieved by:

• Production ramp from 5k/week to 7/k week, which could reduce depreciation by c.$0.5k per car and staff costs by c.$1.5-2k per car.
• New more efficient battery module and pack designs: $0.5-1k per car
• $10-20/kwh reduction in Panasonic cell purchase cost: $0.5-1k per car
• Cancellation of referral program (I'm not sure how this is accounted for, but it may reduce deferred revenue by c.$0.5k)
• Cancellation of Trump's China tariffs: $0.5-1k per car.
• Other supplier cost savings with negotiations and purchasing scale: $0.5-1k
• Other car design improvements: $0.5-1k
• Better production quality to reduce scrap, rework and warranty costs: $0.5-1k

Does anyone have any views on whether these potential savings look realistic?

If they can switch the "low price" model S/X production line to model 3, that will increase potential production.

If they can make a modified S/X battery casing and convert to 2170 cells, that will not only reduce the number of individual cells required per pack, but also remove shipping costs, plus improve economy of scale for the (cheaper) cells.
I imagine just these two alterations would yield more profit.

 

[MartinAustin]

That boat is now traversing the Caribbean Sea...

View attachment 370629

OMG the first mate is picking his nose!

And.... the captain just picked up his coffee with his left hand... is he a leftie? I wonder what that means for Tesla...

 

[pz1975]

I reserved pre-reveal, I got the print, no die-cast

I got the print and the die-cast car but did not line up in person for my reservation. I made my reservations online as soon as it opened.

 

[Sean Wagner]

I knew the pictures would be hard for people to look at, and for me as well. It was hard for me to see the ICU picture which I had avoided looking at for years.
...
reminds me why I do this work.

[/QUOTE]

Heart warm-wrenching lines,
memories laid bare still sear,
life ever more dear.

And thumbs up to @Open Interest

 

[Silent Ludicrosy]

If only the Model 3 had been available when the BP’s Deepwater Horizon dumped 4.9 million barrels of oil in the gulf. I think a lot of people would have sworn off gas out of anger.

 

[BioSehnsucht]

Exactly. And that's more aggressive driving than most of the world does. Where I am, for example, the maximum speed limit in the country is only 56mph Even a performance on 20" wheels would be unlikely to burn 310 Wh/mi over here (unless the driver is fond of tickets ).

Never underestimate (especially if it were a Performance model rather than a "mere" LR RWD) how much energy can be burned up launching from a stop light/sign to a hair over the speed limit. Repeatedly. It's that wonderful feeling of being pressed back into your seat just before a plane lifts off the ground... I could totally see someone with a Performance getting terrible range. Their energy usage chart would be a hilariously hellish moonscape you'd never want to play lunar lander on.

 

[gene]

If only the Model 3 had been available when the BP’s Deepwater Horizon dumped 4.9 million barrels of oil in the gulf. I think a lot of people would have sworn off gas out of anger.

About 2 or 3 years ago we had an medium size oil spill here in Santa Barbara. The local tiny newspaper, was publishing articles daily and the comments section was quite active. I was writing in the comments section recommending kicking the gas habit and offering recommendations for various EV's. What was amazing to me was that there were climate denier trolls all over those articles. Some of the same trolls we see on Cleantechnica and Elektrek! This is a tiny local newspaper yet those very same trolls are everywhere!

 

[mongo]

Never underestimate (especially if it were a Performance model rather than a "mere" LR RWD) how much energy can be burned up launching from a stop light/sign to a hair over the speed limit. Repeatedly. It's that wonderful feeling of being pressed back into your seat just before a plane lifts off the ground... I could totally see someone with a Performance getting terrible range. Their energy usage chart would be a hilariously hellish moonscape you'd never want to plan lunar lander on.

On the plus side, it's a high efficiency electric motor on a car with regen, the energy delta of jack rabbit starts is much less than with an ICE...

 

[SO16]

Fabulous!

You do realise that we here want as many successful EV's as possible coming to market?

You do understand, right, that Tesla's mission is to transition our planet away from fossil fuels.

Obviously you're a very smart fellow, so you'll appreciate that Tesla cannot do this alone, at least not fast enough to save us. We need the other manufacturers to get on with it too.

The Porsche Toucan may take some sales from Tesla, I've no doubt, but primarily it's going to osbourne other Porsches.

It will be a nice car, Porsche make nice cars, nobody argues with that. But I doubt they have enough batteries for 40k cars per year and, once again, no dedicated charging network, and how may 350kWh public chargers are there?

So a nice car for Sunday driving, but a long way to go before it can be used on Autobahn.

All the “analysts” like Anton and Mark Sméagle realize this. Their goal is to create FUD in order to profit from it.

 

[EVNow]

Porsche now planning on doubling production of Taycan to 40,000 per year.

2011 Ghosn : We plan to make 150k Leafs per year.

It would be great if all these legacy OEMs made millions of EVs per year. But I'm not holding my breath.

 

[Reciprocity]

Toyota Camry 4 cylinder will get you about 30 MPG, 0-60 7.6 seconds
Toyota Camry Hybrid will get you about 50 MPG, 0-60 7.9 seconds.

The slowest Model 3 will(123 MPGe) do 0-60 in 5.5 seconds, quicker than a Camry V6 XSE( MSRP $35k Plus).

Then there is safety.......

or Charge at home and then only part of long trips will be as much as Gas.

 

[SebastianR]

Isn't Option 1 making the people who pay for premium car basically pay a subsidy to the entry model car. Lower the price of all cars while making a profit.
I think people can understand it happening at ICE dealers on completely different models but the 3 is lesser optioned car so at least to me its the same model car that might ruffle feathers of premium buyers.

I agree. In some ways that's why the Performance versions exist - granted every single Tesla car has a positive gross margin but of course the performance versions contribute more to Tesla's growth than other cars.

So I think we would see Option 1 only if a 35k Model 3 was not within reach. The fact that trimming of personnel, culling of the referral programme, increasing Supercharger rates and other revenue generating / cost cutting measures might be enough to get within reach of a break-even for the Model 3 SR is extremely encouraging to me.

 

[M3Rider]

OMG the first mate is picking his nose!

And.... the captain just picked up his coffee with his left hand... is he a leftie? I wonder what that means for Tesla...

In fact, the captain is so pro-Tesla that he offered to use his ship as a Tesla mobile office - so customers pick up cars directly from the ship and Tesla salespeople do the paperwork in the captain's office. For Tesla that would mean savings on the office space.

His message is a little confusing, but that's what I make out of it:

This is a joke, obviously this is a different captain
(ASL Airlines Belgium - 757)

 

[gora321]

Colour me confused, but why is it some days they register 25k, then other, 86 - what's the purpose?

Can be anything...maybe verification batch for some change, production batch with higher production speed, colour... Looks like that those VINs should be separated or not. Guess, guess, guess...