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

[neroden]

I am talking about something more fundamental. Many here are talking about how great their chip/board is (it is great for sure) , how they lead in training data (they do by far!), and how amazing deep learning neural nets are (they are doing some cool things). BUT...no one seems to question what seems to be the default assumption that given: a great chip/board + gazllion miles of training data + deep learning NN == FSD car.

If by "no one seems to question", you mean "Only neroden and a couple of others seem to question", then sure. You're saying what I've been saying.

 

[neroden]

Wondering what people are thinking in terms of Chinese Model 3 reservations? On the one hand China is pushing 1.4B so that implies millions of potential buyers. But on the other hand they are only expected to sell about 1.5M electric cars this year, as opposed to 20M-ish cars total, most of which are a lot less expensive than the Model 3, and they are dropping electric incentives. If you assume Model takes 2-3% of the electric market that would be 30-45K, but on the flip side 2-3% of the overall car market would be 4-600K. Anybody want to take a stab at it that has a good perspective on it? Kind of wondering if they will pull in a couple hundred thousand reservations over the weekend or if it will take a lot longer.

5%-10% of the electric market is a good short-term estimate. (Go check out Jose Pontes's reports of how many cars the other Chinese EV makers are producing.) So 75K - 150K rezzies probably.

 

[neroden]

EM's piggy bank against margin calls ...

Yeah, if he could borrow against SpaceX at 20% of face value (which is easy to do against private illiquid stock... could probably get more) he could get $3.8 billion, which is far more than the size of his half-billion-dollar loans against TSLA stock. So unless every banker in the world simultaneously refused to lend against SpaceX (which is unlikely, though possible in a "1929" scenario) he could eliminate all his borrowings very quickly.

 

[neroden]

That's a very interesting leak if true:

• ~80 SR battery packs per hour,
• ~1,920 packs/day,
• ~13,440 packs/week.

Obviously some LRs & Performances are being made. And some Powerwalls and Powerpacks. So it probably ends up being more like 10,000 packs per week. Aka the target number...

Though going to higher production is always better, because that Powerwall backlog needs to be fulfilled!

Presumably these are peak rates, but still very impressive. I suppose cell supply and Fremont assembly throughput has become the primary bottleneck, as hypothesized by @neroden for a long time.

Note that initially the Shanghai SR packs will be made in GF1, so they need this extra pack production capacity.

 

[EVMeister]

Just listening to the Ride the Lightning podcast (https://teslapodcast.libsyn.com/episode-200-my-elon-musk-interview). It's amazing how much of what Musk is saying here reflects what has been said by various bulls on this forum. For example, on many forums etc. and by some here there was widespread disappointment with the Model Y reveal. But what Musk said:

"I intentionally didn't go all out with the Model Y reveal, because I didn't want people to buy a Model Y instead of a Model 3."

About 34 mins in he has also basically confirmed Model Y is very likely going to be produced as Fremont. Not sure if this is new news, although it seems to me to be stronger confirmation than we've had before.

 

[neroden]

I was just thinking about how Apple wanted to buy Tesla years ago at $240. They required Musk be removed as a condition. That's why the deal never went though.

With the cash reserves Apple has, they could short Tesla all the way down to $150, where Musk's own shares get liquidated:

$30. Musk doesn't get a margin call until $30. Do your homework.

 

[neroden]

historically I believe supercharger construction is positively correlated with good quarters

They suspend supercharger expansion whenever they're having cashflow issues and resume it when they have plenty of cash again.

 

[neroden]

OT

state tax of likely 13.3% and cap gains is like 20%. i may be thinking too simply here. I am sure tax guys would know a better way.

Musk's shares, being from very very early, probably qualify for the small-business startup tax break, which cuts taxes by more than 50%. I can't remember the code provision off the top of my head.

 

[Sancho]

Elon said he wants the AirBNB/Lyft/Uber model:

Elon Musk: "And - but then also have the ability for customers to offer their car and add or subtract their car to the fleet at will. It will be a company owned fleet - and the company-owned fleet with just be aware that aren't enough customer cars to be life out. So if we find like a particular metro, there aren't enough customers who are going to add their car to the shared fleet. And then, that's where we'll start rum them with a Tesla fleet. So that's why it's a certain combination of Uber, Lyft and Airbnb. And then we charge something probably comparable to, yeah, you have to say [Asterworks] [ph] or I don't know we tried 30% or something, in order for somebody to add the car to the fleet."
​

Car rental is similar to home rental in that sense.

I don't know whether they are planning to start it this way, or they want the full FSD taxi functionality straight away.

The lines can blur between Uber, Hertz and Zipcars. I believe the first implementation of Tesla Network will be offered to people who are willing and able to be safety drivers when the car picks them up. And when the car is traveling from one customer to the next, the "safety driver" will be someone in a remote location with an Internet feed from the robotaxi.

A company in Colombia is currently using remote controlled robots on US college campuses to deliver food. The remote attendants are in Colombia, being paid $2 hour.

Really folks, how much further along does FSD technically need to improve before it is abundantly safe to operate with a safety driver that is remote? In the rare cases that signal is lost with the attendant, the car just stops or pulls over at the first opportunity.

Perfectly safe and reliable? No. More safe and reliable than the typical Uber driver? Yes.

 

[SO16]

and allow those locations to buy and sell used Tesla vehicles.

Dealerships can do this now.

 

[SO16]

But service centres are needed. And more of them.

It’s happening. Just takes some time and money. Can’t build out all the service centers BEFORE they have the sales to help pay for them.

Tesla will be opening a lot of service centers next year, including Knoxville: Elon Musk - 1redDrop

 

[FreqFlyer]

Ride the Lightning: Tesla Motors Unofficial Podcast: Episode 200: My Elon Musk Interview

(51 mins in) Elon: Ideally pickup truck will have a maximum starting price under $49,000 (or less).

Goal is to be "functionally better than an F150 and faster than a 911" is what I think he said!

30 minutes in he talks about the rear structure of the Y going to an aluminum casting that replaces stamped steel with 70 parts. Less costs, less robots and improved NVH.

Munro would be impressed, one make sense the Model 3 get the same treatment. Less costs.

 

[FreqFlyer]

Y will be made at Freemont because its the fastest way to getting to volume production.

 

[Webeevdrivers]

It’s happening. Just takes some time and money. Can’t build out all the service centers BEFORE they have the sales to help pay for them.

Tesla will be opening a lot of service centers next year, including Knoxville: Elon Musk - 1redDrop

Yah I get that. Makes sense. But I think a big sign saying “Tesla Service Centre” or just “Tesla” would inspire confidence in some to buy the car that otherwise wouldn’t. We had other reasons why we couldn’t make the model 3 work for us but it was a concern. We will probably be putting a deposit on a model Y someday but will still be paying attention to this aspect of Tesla closely.

 

[SO16]

Yah I get that. Makes sense. But I think a big sign saying “Tesla Service Centre” or just “Tesla” would inspire confidence in some to buy the car that otherwise wouldn’t. We had other reasons why we couldn’t make the model 3 work for us but it was a concern. We will probably be putting a deposit on a model Y someday but will still be paying attention to this aspect of Tesla closely.

I live in Michigan. The MOST Anti-Tesla state in the US. Closest service center is about 3 hours away. Fortunately mobile service is allowed. I have had my Model S for about 2.5 years. Have yet needed to go to the service center. Will be taking it to Toledo in a couple weeks for just general maintenance and a few minor issues. Service is not as big of problem as some like to make it out to be.

 

[neroden]

of course Tesla needs to advertise. the benefits are myriad and non-obvious. people on this thread who are like "i don't pay attention to commercials" are completely and utterly missing the point.

Paid advertising is expensive and a poor bang for the buck right now. Tesla needs to fix its customer (and internal) communications, so that customer service becomes good (it's currently awful, and it's not the fault of the bottom-line people -- they're doing their best -- it's due to a lack of institutional process support). That's a better bang for the buck.

 

[printf42]

OT

Yeah, if he could borrow against SpaceX at 20% of face value (which is easy to do against private illiquid stock... could probably get more) he could get $3.8 billion, which is far more than the size of his half-billion-dollar loans against TSLA stock. So unless every banker in the world simultaneously refused to lend against SpaceX (which is unlikely, though possible in a "1929" scenario) he could eliminate all his borrowings very quickly.

Don’t forget he spent big chunk of his loan on buying houses, and those should have got pretty good return recently, probably refinancing those houses alone could cover his loans against TSLA stocks.

 

[Webeevdrivers]

I live in Michigan. The MOST Anti-Tesla state in the US. Closest service center is about 3 hours away. Fortunately mobile service is allowed. I have had my Model S for about 2.5 years. Have yet needed to go to the service center. Will be taking it to Toledo in a couple weeks for just general maintenance and a few minor issues. Service is not as big of problem as some like to make it out to be.

Yah I hear ya. We drive two EV’s, neither a Tesla. Both 4 ish years old and neither one has ever been back to a dealership and the only maintenance has been washer fluid. But I think it’s a point of reassurance to see the brand represented. I like the idea of the rangers. But they must operate out of somewhere. How about a big shiny Tesla sign over their shop. I hear it at work all the time. “As soon as they put a dealership in (fill in the blank) I’ll consider a Tesla”. For some it is a concern.

Jmho

 

[SO16]

Yah I hear ya. We drive two EV’s, neither a Tesla. Both 4 ish years old and neither one has ever been back to a dealership and the only maintenance has been washer fluid. But I think it’s a point of reassurance to see the brand represented. I like the idea of the rangers. But they must operate out of somewhere. How about a big shiny Tesla sign over their shop. I hear it at work all the time. “As soon as they put a dealership in (fill in the blank) I’ll consider a Tesla”. For some it is a concern.

Jmho

The mobile technician I have lives in Grand Rapids, MI. They are just paid “based” through Cincinnati. So again, non-issue.

What’s really funny is that I avoided dealerships with my gas car. I just took it to a local mechanic. With mobile service, I don’t even have to do that. They just show at my house.

The only time it could be a pain for me is if my only option was to have it shipped out of state and wasn’t drivable. But I have yet to have that happen.

 

[CorneliusXX]

Yeah, if he could borrow against SpaceX at 20% of face value (which is easy to do against private illiquid stock... could probably get more) he could get $3.8 billion, which is far more than the size of his half-billion-dollar loans against TSLA stock. So unless every banker in the world simultaneously refused to lend against SpaceX (which is unlikely, though possible in a "1929" scenario) he could eliminate all his borrowings very quickly.

I hope at some point this silly margin call argument can be put to bed. Not only does he have relatively low borrowings against his Tesla shares, he could easily borrow against SpaceX shares, he also has substantial property in California, very wealthy friends who are likely to help him out, many entrepreneurial lenders who would chip in, etc, etc.

We'll know if there is any concern if he sells his jet.