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

[NicoV]

As well as that, in discussion with non-owners, the narrative is switching away from "nice cars, can't afford", to "I'm thinking about it and am doing the maths to see if it's feasible

I' ve had the same experience with a friend who thought a Model 3 was too expensive, even after I made a TCO spreadsheet for him. He's now considering a second hand Model S, and forwarded my TCO analysis to a friend who will now buy a Model 3.

On the Benelux FB group today: an angry guy who was supposed to have a test drive today in a SEC, but Tesla forgot to cancel the appointment, because all test vehicles have been sold. I think Tesla was very successfull getting rid of their pre-raven inventory at fairly high prices. They may have been too pessimistic with their inventory writedown in Q1, this could surprise positively in the results of Q2.

 

[brian45011]

Both motivation and tools to accomplish industrial sabotage against Tesla's Fremont factory are far more accessible, and as a publicly traded company the payment can simply be extracted from public markets.

Some who have been involved in de-bottlenecking automated processes beyond their design set points may be willing to accept that unexpected consequences might be attributable to factors other than sabotage. YMMV.

 

[traxila]

July 4th week -- no trading on Thu, short trading day on Wed, many long traders taking long weekends. Expect bear raids this week.

Neroden all you say is true. But I have seen these short trading days cut both ways. You have to love this stock to have absolutely no clue which way it is about to go. Low volume and great news could easily result in a mini short squeeze which everyone luvs to talk about. Or some bad news re deliveries could hammer the stock. Place your bets...we are starting from a pretty low point compared to where TSLA used to be.

 

[Fact Checking]

I' ve had the same experience with a friend who thought a Model 3 was too expensive, even after I made a TCO spreadsheet for him. He's now considering a second hand Model S, and forwarded my TCO analysis to a friend who will now buy a Model 3.

I think second hand Model S's with free unlimited supercharging grandfathered in will be worth a lot in the future, especially in Europe where I'd expect charging networks to not expand fast enough once the explosive phase of the EV adoption S-curve begins.

As a comparison, historic precedents of adoption rates in various (high-tech) industries:

If we are dumbly and mindlessly extrapolating from that, then the most explosive portion of EV adoption would start about 5-10 years after introduction, and last about a decade.

If we count ~2010 as the introduction of the first viable EV, then ~2020 would roughly mark the "critical mass" point and the beginning of the fastest phase of EV adoption, and would last about a decade. Maybe longer, because the car replacement cycle is slower than other high-tech products (5-7 years) due to its cost and longevity.

So the 2020's could be the new 'Roaring Twenties' of the fourth/fifth industrial revolution.

 

[kelly]

... primarily because Tripp is hiding out in Romania to evade the lawsuit and trial (no US extradition treaty).

In Tripp's civil case extradition doesn't come into play I don't think. I think extradition is a criminal concept. As plaintiff, Tripp can't really evade the lawsuit. Even though he is in Romania, his lawyers have to respond to motions and provide discovery as if he was here. As to evading the trial, in civil suits it is pretty uncommon for a plaintiff to not show up for the trial. I think his deposition would be taken prior to trial and then his deposition testimony would be used at trial. But defendants would much prefer the plaintiff to show up. I don't know if a plaintiff can be forced to attend.

Did I mention that I'm no expert on the subject? Lots of "I think"s up there.

 

[AlMc]

JMP Securities analyst Joseph Osha reiterated a Market Outperform rating and $347.00 price target on Tesla (NASDAQ: TSLA)

 

[mongo]

Some who have been involved in de-bottlenecking automated processes beyond their design set points may be willing to accept that unexpected consequences might be attributable to factors other than sabotage. YMMV.

If the code (or settings) on the machine is not the code (or settings) you put on the machine, it's not an unintended consequence, it's sabotage (or bad version control)
(see also stuntex)

 

[Artful Dodger]

Business Insider's German cousin is out with some fresh paywalled FUD

Tesla Model 3: Liefer-Chaos, verärgerte Kunden, mangelhafte Autos

Here is a more trustworthy source from Germany discussing Model 3 quality:
( paging @avoigt )

Alex‏ @alex_avoigt Jun 25

Deliveries go according to the plan including a larger push. A few days delay in Hamburg but still all within Q2. Overwhelming positive reports from Germans about build quality, panel gaps, glass roof, paint ... Can't find any complains. "Best car ever" an often used term.

12 replies 31 retweets 171 likes​

 

[Right_Said_Fred]

• In the Netherlands the final week of deliveries in June wasn't nearly as crazy as the final week of March:
• View attachment 425173

The graph you found for The Netherlands and which ended with 200 registrations on the last day of June, was not complete. It was missing Friday, Saturday and Sunday with 379, 268 and 22 Model 3 registrations.

 

[neroden]

Sometimes after a careful root cause analysis a different explanation is found.
Was SpaceX’s Rocket Sabotaged?

Inside Tesla’s Audacious Push to Reinvent the Way Cars Are Made

Mr. Musk doesn’t have an office at the plant, but Tesla says he has been sleeping there — on the floor in someone else’s office, or on a couch — while working to streamline Model 3 production. At 3 a.m. on Thursday, the time Tesla made him available for a telephone interview, he said he was trying to fix a glitch in the part of the plant where the Model 3 is painted. “The carrier that the car is on is coming out of the paint booth slightly too fast for the sensor to recognize it, and it’s tripping the sensor even though everything is fine,” he explained.
Tesla engineers are trying to reprogram the sensor so it can operate at the accelerated pace. For now, he said, “we have somebody standing there just pressing the ‘O.K.’ button to restart it.”​

That predated the paint shop sabotage report by months. They didn't even uncover the sabotage until after they'd dealt with that. The paint shop sabotage was *subtle* and *well hidden*, apparently.

I suspect that the software problems which they suspected of being sabotage were the cause of the *intermittent* bad paint jobs which were happening on *some but not all cars* until roughly the time when they said they suspected sabotage. (After which the paint jobs have been consistent.) I don't think the sabotage had much to do with the ramp-up speed.

 

[Fact Checking]

In Tripp's civil case extradition doesn't come into play I don't think. I think extradition is a criminal concept. As plaintiff, Tripp can't really evade the lawsuit. Even though he is in Romania, his lawyers have to respond to motions and provide discovery as if he was here. As to evading the trial, in civil suits it is pretty uncommon for a plaintiff to not show up for the trial. I think his deposition would be taken prior to trial and then his deposition testimony would be used at trial. But defendants would much prefer the plaintiff to show up. I don't know if a plaintiff can be forced to attend.

Did I mention that I'm no expert on the subject? Lots of "I think"s up there.

Not a lawyer, but I believe in civil cases failure for a defendant to show up in response to a trial subpoena (assuming the judge issues any) can be construed as evidence against the defendant by default:

Civil Procedure Subpoena Law and Legal Definition | USLegal, Inc.

"If the person is required to travel more than a minimum distance, they may be required to be compensated for reasonable travel expenses. Failure to comply with a subpoena may subject a person to being held in contempt of court if it appears the absence was intentional or without cause."​

I'd expect Tesla to offer to pay for any plane tickets from Romania.

I.e. not a good move by Tripp.

 

[Webeevdrivers]

So 3rd quarter production possibilities. From what I gather from some things I have read, Tesla is producing 1000 model 3’s per day. So assuming another 200 S and X, even with a fudge factor is this the quarter we see over 100,000 cars produced....and sold?

Gitterdun Elon.

 

[neroden]

So 3rd quarter production possibilities. From what I gather from some things I have read, Tesla is producing 1000 model 3’s per day. So assuming another 200 S and X, even with a fudge factor is this the quarter we see over 100,000 cars produced....and sold?

Yeah, pretty much guaranteed. At 20K S/X (which should be conservatively doable in Q3) and 1000 cars a day of Model 3, it would be 112000. Some downtime and some inventory-in-transit buildup should bring the number delivered lower than that, but over 100K seems guaranteed in Q3.

 

[Fact Checking]

Good news from China:

Beijing’s move to keep tax break on purchases of new-energy vehicles to support troubled auto sector, help biggest players

"A move by Beijing to keep a sales tax break on environmentally friendly cars to help the sputtering auto sector will boost the fortunes of top domestic EV manufacturers as well as the popular Tesla from the US over smaller players, analysts say."

"Beijing had been widely expected to scrap the sales tax break, but the Ministry of Finance announced on Friday it is extending it. A change had been expected to go into effect Monday, but buyers battery-powered and plug-in hybrid cars will still be exempt from the 10 per cent sales tax until the end of 2020."​

I.e. the expected move probably helped Q2 deliveries in China, and now it's been extended on the final days of Q2 - which should help keep up Q3/Q4 demand in China by keeping Tesla cars 10% less expensive than the ICE competition.

(BTW., I love it how Tesla is characterized not as "troubled", "struggling" or "unprofitable", but as "popular". )

 

[ZachF]

I think second hand Model S's with free unlimited supercharging grandfathered in will be worth a lot in the future, especially in Europe where I'd expect charging networks to not expand fast enough once the explosive phase of the EV adoption S-curve begins.

As a comparison, historic precedents of adoption rates in various (high-tech) industries:View attachment 425196

If we are dumbly and mindlessly extrapolating from that, then the most explosive portion of EV adoption would start about 5-10 years after introduction, and last about a decade.

If we count ~2010 as the introduction of the first viable EV, then ~2020 would roughly mark the "critical mass" point and the beginning of the fastest phase of EV adoption, and would last about a decade. Maybe longer, because the car replacement cycle is slower than other high-tech products (5-7 years) due to its cost and longevity.

So the 2020's could be the new 'Roaring Twenties' of the fourth/fifth industrial revolution.

Somewhat OT:

Renewable electricity beat out coal for the first time in April

Renewables generated more electricity than coal in the US for the first time.

 

[Webeevdrivers]

Yeah, pretty much guaranteed. At 20K S/X (which should be conservatively doable in Q3) and 1000 cars a day of Model 3, it would be 112000. Some downtime and some inventory-in-transit buildup should bring the number delivered lower than that, but over 100K seems guaranteed in Q3.

And to me that is a bit of a phsychological barrier. 6 figure quarterly production numbers. On the way to the big leagues.

Jmho.

 

[Fact Checking]

So 3rd quarter production possibilities. From what I gather from some things I have read, Tesla is producing 1000 model 3’s per day. So assuming another 200 S and X, even with a fudge factor is this the quarter we see over 100,000 cars produced....and sold?

Gitterdun Elon.

GF1 apparently reached ~1k/day (7k/week) only by end of May, i.e. in the second month of the quarter.

So Q2 Model 3 production should be in the 70k-85k range (5.4k-6.5k/week), and Model S/X was likely still constrained by pre-Raven inventory flush attempts and Raven ramp-up - which suggests production in the 15k-20k range (1.1-1.5k/week).

VIN-ology estimates, FWIIW, suggest a Q2 Model 3 production target of 84.5k.

Total Q2 production would thus be in the 85k-105k range - but I'd guess the 100k+ estimates are probably too optimistic.

We'll see in a few days!

Edit: silly me, you were talking about Q3, not Q2...

I concur with @neroden, barring force majeure, 100k+ production seems to be possible and even likely in Q3.

 

[ggr]

My official estimate is 92,345.6 (and that is probably low). My real estimate was 92,500 but I liked 92,345.6 better. More surprising will be profitability when Q2 financials are released. I know I'm going out on a limb here but I think Tesla is quietly performing on numerous fronts and ready to surprise all the naysayers.

Forward-looking statements will have appropriate restraint but they will paint an accurate picture that is so compelling the shorts will be forced to continue the covering they began when delivery numbers were released. The bears will lose what little credibility they have remaining and new money will flood in before it's too late. Shares will over-react to the upside.

But the person who gets the 0.6 of a car will return it for warranty repair and then complain about how long it takes. :-(
/S

 

[Cobbler]

 

[Fact Checking]

JMP Securities analyst Joseph Osha reiterated a Market Outperform rating and $347.00 price target on Tesla (NASDAQ: TSLA)

More details:

JMP Securities analyst Joseph Osha reiterated a Market Outperform rating and $347.00 price target on Tesla (NASDAQ: TSLA) as well as his above consensus unit production forecast of 97,000 vs consensus of 84,000, All of the upside is coming from Model 3 volume.

The analyst stated "we think the Street is underestimating the pace of recovery in Model 3 demand in the U.S., and additionally is not accounting for a full quarter of Model 3 exports. From a valuation standpoint, we continue to use 2020E target multiples of 2.5x EV/Revenue, 15x EV/EBITDA, and 35x free cash flow, with the resulting valuation discounted back to the present at 10%".​

This is probably part of today's TSLA price action which is going against NASDAQ trends.