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

[Webeevdrivers]

Why even 85k would see a big stock pop? 85k likely will lead to significant Q2 loss, also means Q3 will be tough, and yearly 360~400k would be difficult to meet. I hope we can get to at least 95k and close to GAAP breakeven.

In Q2 some Canadians get very large tax incentives, Californians can get $3750+2500, that's one of the reasons why north America is so strong. Both incentives can't last forever. If you can't make a profit under this condition, what happens when those tax incentives go away? At least that's what shorts think.

Right now I'm not sure the strong NA demand is because of awareness or tax incentives. I think there is a good chance it's because more and more people get a chance to test drive the Model 3. They want the car regardless of the tax incentives. In this case we should see huge worldwide demand quarter after quarter. We will have a better understanding after a few more quarters. Once we get more demand than supply, Tesla might be able to raise price a little bit.

On June 5th, they said already delivered 33k in north America, plus 16k either in the process or VIN assigned. At this pace, if we get ongoing order of 600 a day, we should normally reach 61k for NA Q2. The quarter end push should get it over 65k.

I’m not aware of any tax incentives in Canada for buying an EV. Are you possibly referring to purchase incentives in B.C. and Quebec? They are not related to taxes. They are essentially grants.

 

[dqd88]

Not one of his better video's .
Way to much Gerber and not enough Tesla.
I am not of fan of Me...I ...Me..I and Gerber has that is spades.

I liked hearing Gerber's background and insights into his personal life. Provided context behind his perspective on Tesla. One cannot get that perspective just from Gerber's tweets.

 

[Beltsbear]

So Tesla could create a "Nickola" sub company for a rebadged 3 and Y and the $7,500 credit would kick back in? Surely they'd quickly change the requirements, even though Tesla is still the leading American BEV manufacturer by far.

Honestly, I think the tax credit is a terrible incentive anyway because you have to owe that amount of FIT in order to take full advantage. This has been the second year in a row I've owed and paid no FIT, so if I were going to buy a 3, the credit wouldn't even apply! With the SR+ models now coming out, it makes them far more available to folks that don't owe huge amounts of FIT, so I don't think the lower amount of credit come July will significantly affect sales or at least a portion of the credit won't be left on the table.

Making a sub company would not qualify for the federal credit as it would still be considered the same company. Interestingly if Tesla sold the model 3 to Ford or Toyota and they rebadged it, Ford or Toyota would probably be able to sell the car with the $7500 credit.

 

[dhrivnak]

It might be worth a shot.

Currently every climate change thread on TMC is overrun with climate science denial trolls which IMO makes them fairly useless but maybe the investor thread moderators can keep it from getting out of hand.

That thread is not too bad at the moment and there is a lot of good information in that existing thread.

 

[RobStark]

So Tesla could create a "Nickola" sub company for a rebadged 3 and Y and the $7,500 credit would kick back in?

Tesla would need to create a seperate company "Nickola" in which it owns no more than 50% stake in. I think that is how Polestar is getting a seperate 200k from Volvo. I am not 100% sure though.

 

[wipster]

Making a sub company would not qualify for the federal credit as it would still be considered the same company. Interestingly if Tesla sold the model 3 to Ford or Toyota and they rebadged it, Ford or Toyota would probably be able to sell the car with the $7500 credit.

So Buick could sell a rebadged Bolt, but it would be counted under GM? That would also apply to Honda/Acura, Toyota/Lexus, et al?

 

[wipster]

Tesla would need to create a seperate company "Nickola" in which it owns no more than 50% stake in. I think that is how Polestar is getting a seperate 200k from Volvo. I am not 100% sure though.

That makes sense.

 

[RobStark]

I hadn't considered that Chinese consumers would see the American made version as higher quality.

I have only been arguing this point for, oh, 2 years.

 

[printf42]

Now 123, 41 (mostly Dubai), 51, and 258. The 7 "post-Raven" Model S inventory in the US seem to be oddballs and may be hard to move. The Dubai inventory probably ought to be physically relocated to Europe. I'm guessing by early next week the rest of the pre-Raven inventory will be gone. (The Dubai inventory isn't moving.)

I don't think tracking inventory through EV-CPO is meaningful for Model 3, given the way Tesla works. I also don't think it's meaningful for the current model of S and X; but I think it's meaningful for seeing whether they're able to clear out the pre-refresh models. They're going fast.

Checked the “raven” inventory on ev-cpo, all of them are actually pre-raven, with 259 or 335 or 315 miles range, which is different than raven’s 285/370/345 range. You can follow the links and see it on Tesla site.
Guess ev-cpo somehow messed up their vin decoders. As they have been for a few cars for awhile.

tl;dl:
There are no raven inventory whatsoever, as always.

 

[RobStark]

I just can't wrap my head around the fact that the US government is subsidizing German and Korean made EVs (qualify for $7500 rebate) at the expense of American made EVs (qualify for $3750 rebate and soon only $1875 or $0). China only has rebates for EVs made at home, the US will soon only have rebates for EVs made abroad. You can't make that up, it's schizofrenic. I thought this government was all about 'Murica First? Try Europe and Korea first. I guess tariff man didn't get the memo yet (or didn't feel like reading it).

When China joined the WTO they were admitted as a "developing nation" which allows them to make such discriminatory subsidies.

That is why there are no such discriminations in Europe or the USA.

VW is thinking up contrived ways of excluding Tesla from German subsidies like limiting the length of BEVs that qualify. Or limit the price, where only Teslas are excluded. But that practice seems like it will start to fade in importance now that Europeans are making $60k plus BEVS and Tesla is making sub $50k BEVs.

In order for the USA to make such discriminatory subsidies work it would need to pull out of the WTO.

 

[RobStark]

Making a sub company would not qualify for the federal credit as it would still be considered the same company. Interestingly if Tesla sold the model 3 to Ford or Toyota and they rebadged it, Ford or Toyota would probably be able to sell the car with the $7500 credit.

The rebadged Ford or Toyota would qualify. The rules specifically say so.

 

[dc_h]

I haven't seen many estimates for Q2 deliveries above 100k, but the way I see it we're going to hit ~ 104k.

- NA 33k for April/May and let's assume 33k June. That's 66k.
- European sales figures for March/April is at least 9k already. If June is going to be anything like March (except for Norway, probably less than 3k), my estimates are 23k for Q2.
- China probably >15k.

NA 66 + Europe 23 + China 15 = 104k.

I think it's plausible given the production estimates:

- S/X = 25k / quarter
- Model 3 = 800/day on average x 90 days ~ 72k. there are more working days in Q2!
Estimated total production for Q2 = 97k

Vehicles in transit in Q1: 10.600

Production + transit Q1 = 25k + 72k + 11k = 108k
deduct vehicles in transit for Q2 of ~ 4k = 108k - 4k = 104k

So deliveries should be above and beyond Q4, if and it's a big if, is that June = March delivers for Europe/China and NA = 33k.

I can only see demand taking of from here, given that Tesla is yet to open sales in 2/3 of European countries, Latin America and rest of the world.

European Sales Q2'19 Estimate
View attachment 417376

I hope you are right, but I Troy Teslike is currently estimating 80,000. He’s often conservative, but usually pretty accurate. I think his Europe and Canada estimates are light, but it would be unique for him to be off by more then 10%. I’m also not sure he’s showing any deliveries to the Britain.

Troy Teslike on Twitter

 

[Right_Said_Fred]

In order for the USA to make such discriminatory subsidies work it would need to pull out of the WTO.

The US does not need to make discriminatory subsidies against foreign car makers, it just needs to stop doing the opposite.

 

[Right_Said_Fred]

I hope you are right, but I Troy Teslike is currently estimating 80,000. He’s often conservative, but usually pretty accurate. I think his Europe and Canada estimates are light, but it would be unique for him to be off by more then 10%. I’m also not sure he’s showing any deliveries to the Britain.

Troy Teslike on Twitter

A week ago he was saying 76,000, so he is moving in the right direction

 

[Drumheller]

Toyota exec probably sounds like a Nokia/Blackberry exec in early 2008...

Prius falls on hard times | Business | Journal Gazette

"But sales peaked in the U.S. in 2012, and its descent roughly follows the rise of Tesla Inc.'s sleek fully electric cars including the more mass-market Model 3 sedan. “It's a competitive business,” said Bob Carter, Toyota Motor Corp.'s executive vice president for U.S. sales. “There are some people who trade in their Prius for a Model 3 – I'm well aware of that. But it's still a very small part of the market.”

One. I'd like to see just one person that traded in a model 3 for a Prius.

 

[Doggydogworld]

Here is a very revealing article on where Cruise is at, in terms of FSD. Industry analysts rank Cruise only behind Waymo when it comes to FSD.

Cruise’s Secret ‘Apollo’ Robotaxi Milestones (Paywall see the comments)

Here is the most damning piece. Cruise is expected to be just 10% of where Human drivers are on average. So, they have one more 9 to go before reaching human level.



So, what happened ?



They also drive very few miles.



They face difficulty in proving their FSD is better than humans too, whenever it gets there. This is one place where definitely Tesla is in a better position. Tesla fleet can drive 40 million miles every month



There is also this very useful metric in terms of # of crashes for avg human drivers that Cruise is using as the base. So, as I suspected when we take all accidents, including scraping your tire on the curb, in to account, the number of accidents go up to about 1 every 10,000 miles or 99.99 % (4 nines). When only major accidents are taken it is 1 every 282k miles or 99.9996% (6 nines).



ps :
Currently Cruise has passed milestone #2. So, they currently have a major crash every 3 months, instead of human average of once every 25 years ! They do not even have targets for smaller crashes.

Titan

Safety critical events: 3,000 miles per L1 event

Mission failures: 30 miles per event

Total miles required: 9,000 miles

Ride quality: 20% better than Sputnik
​

In early 2017 Cruise was doing this. So, we can compare the progress and see what they have done in 2 years.

Over 600 miles of testing in early 2017, Cruise vehicles had 27 “safety critical events”—including nine severe, or “L1,” events—ranging from an inability to recognize pedestrians, navigation issues, challenges in predicting the movement of objects and two “pedestrian politeness” incidents in which vehicles did not give pedestrians enough space while moving around them.
​

So, from 9 L1 events in 600 miles (or one every 67 miles) they have come to 1 every 3,000 miles. So, they gained nearly 2 Nines in 2 years (98.50% to 99.97%). This is quite good - but the problem is they have hit a plateau and not improving much now.

Great summary. They note that it takes a lot of miles to show a relatively minor improvement:

Cruise vehicles would have to drive 43 million miles for Cruise to believe with 80% confidence that its vehicles are marginally safer than human-driven cars—defined as causing 15% fewer crashes (of a Level 1, 2 and 3 variety),​

Of course it takes far less mileage to show a dramatic difference. Obviously, if you wreck 10 times in your first 100 miles you don't need another 42,999,900 miles to know you suck at self-driving. On the flip side, you can prove superiority vs humans in only a million miles if you have zero Level 1/2/3 wrecks vs. the 50 wreck benchmark.

So, the question to Tesla is - how are they different ? Is it just access to training data or is there something else ?

Self-driving teams today are not limited by data. To the contrary, they can't fully solve cases they see every day. After 10 years Waymo sometimes just sits there at unprotected left turns. They have literally millions of left turn instances in their database. Another 10 million or 100 million instances won't fix this. Self-driving is either a really hard problem or Waymo, Cruise and dozens of others have all just overlooked something easy.​

 

[mongo]

The rebadged Ford or Toyota would qualify. The rules specifically say so.

Can you point me to that rule? I am many 9s sure I read that knock down kits and rebadged versions were not unique manufacturers and would not qualify, but I've been unable to recreate the rabbit hole that led me there.

 

[EinSV]

A week ago he was saying 76,000, so he is moving in the right direction

Troy's record is very mixed.

For example in Q4 his final prediction was 73.2K production 79.5K deliveries. Troy Teslike on Twitter

Actual results were 86.5K production and 90.7K deliveries, so he was way off -- by 13K and 11K. His prediction was pretty poor that quarter.

He may be making the same mistake this quarter -- sticking to his model and ignoring other, potentially more reliable evidence of higher deliveries such as the leaked info last week.

 

[aubreymcfato]

A week ago he was saying 76,000, so he is moving in the right direction

He forecasts a June in Europe of 8000: it'sa bit low, we shall see.
Do we know if SR and SR+ were loaded on the ships?
A good month for Norway, Netherlands, Switzerland, Germany and France could very well surpass 8000 cars... Not counting Sweden and all the others. And we should have the *first wave* of M3s in UK.
I think it will be >10k.

 

[TradingInvest]

I just can't wrap my head around the fact that the US government is subsidizing German and Korean made EVs (qualify for $7500 rebate) at the expense of American made EVs (qualify for $3750 rebate and soon only $1875 or $0). China only has rebates for EVs made at home, the US will soon only have rebates for EVs made abroad. You can't make that up, it's schizofrenic. I thought this government was all about 'Murica First? Try Europe and Korea first. I guess tariff man didn't get the memo yet (or didn't feel like reading it).

German government, Korean government and Chinese government all try very hard to help their own companies. We have concrete examples to show the above is the fact. It totally makes sense too. US government and many US individuals are very unique in this regard.