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

[Boomer19]

Adam Jonas: What if Tesla DOESN’T Have a Demand Problem?

Wait for it....

“We expect bears and bulls to sell the bounce.”

In other words:

“We expect the stock to squeeze and then fade on this news.”

i def think there will be a mix of some profit taking. but i hope that’s just steamrolled by end of Q filings that reveal some large adds or new opening positions

 

[neroden]

Edit: I misread your dates when I first wrote this. What I wrote below is as of at least the Q2 2017 earnings call, and I thought it had been the plan all along, but maybe they described it differently in 2016.

My recollection is that the initially-ordered equipment was going to take them to 5k/week, at which point there would be additional Capex to effectively duplicate the production line to get 10k/week. I expect some of the initial 5k/week CapEx included a lot of stuff that would contribute towards the 10k/week too, as some sections of the line (e.g. paint shop) were supposed to be rated for the the full rate, if I remember correctly. Then maybe some of the 10k/week CapEx ended up being needed to get even to 5k/week (I'm not sure), as they ended up requiring multiple lines even for that. Having said that, it was of course intended to be a fast ramp even in mid-2017, with both stages supposedly happening during 2018.

This is more or less correct... The paint shop and stamping, among other areas, were supposed to handle 10k/week. They did not.

Musk was absolutely certain of 10k/week by the end of 2018 from Fremont. Now Fremont needs to build new buildings to exceed 7k. This is not what was planned.

More paint booths and more stamping machines are needed to get to 10k/week than originally planned. That is unfortunate, financially, and I cannot believe people are arguing with me about this.

 

[Boomer19]

Your last bearish prediction of $150-$160 price levels during the big fall was a big miss though:



Or:



Which you wrote on June 3 when we reached the all time low of $177 - and 20% below those levels would have been ~$140 levels...

That's the problem with technical analysis that ignores the fundamentals.

well nonodys perfect. at least its a different angle of looking at it

 

[sundaymorning]

Lots of analysts will need to revise and rethink Tesla’s S and X demand. Especially with an interior refresh coming.

Tesla Delivery Growth Is Sustainable, Analyst Ben Kallo Says

We’re likely going to have 2-3 weeks of fun with this, all the way into earnings.

 

[neroden]

Wow they said orders exceeded deliveries this quarter that's incredibly bullish for demand seeing as they delivered 95k vehicles! That China factory can't come soon enough.

Obviously demand is not a problem, but wow, they really need to figure out how to speed up production.

They rewound the wave and 3 production is actually lower than I was hoping for, though S/X production looks good,

 

[Etna]

Farting tonight into shorts general direction.

 

[Singuy]

Obviously demand is not a problem, but wow, they really need to figure out how to speed up production.

Too much production and you'll end up out of balance somewhere. We are already seeing unbalanced charging network in certain hot spot of the U.S, crazy service hell, and logistic hell.

 

[S3XY]

You're right, I'm left, she's gone.

And crikey mate, I could give a rip as I'm half Aussie, and damn proud of it!

Apparently it's your top half.

 

[ggr]

Sorry mod. Ya know, I’ve read about 1000 of these on my iPad, and now you’re telling me I need to go back and read them all over again on my MacBook so I can appreciate the mouseovers????

Ayup.

 

[neroden]

Tomorrow I'll build my model with puts, thesis being we'll be back under 220$ by next week. Love a good horse race.

Bear raid scheduled for tomorrow and Friday, so you may be right.

 

[30seconds]

This is more or less correct... The paint shop and stamping, among other areas, were supposed to handle 10k/week. They did not.

Musk was absolutely certain of 10k/week by the end of 2018 from Fremont. Now Fremont needs to build new buildings to exceed 7k. This is not what was planned.

More paint booths and more stamping machines are needed to get to 10k/week than originally planned. That is unfortunate, financially, and I cannot believe people are arguing with me about this.

I agree that Tesla failed to get 10k production levels of S+X+3 out of Fremont. However I'm also pretty sure that since the intro of GF China the 10k goal no longer applies.

Looks to me that GF China will pick up 2-4k of Model 3 production which will allow Fremont to produce the Model Y.

 

[Chunky Jr.]

It's pretty impressive how Tesla has made a car that has become the must have consumer gadget. People don't want it just because it is a great way to get from A to B, they also want it because they want to participate in the consumer experience provided by the software.

 

[neroden]

Too much production and you'll end up out of balance somewhere. We are already seeing unbalanced charging network in certain hot spot of the U.S, crazy service hell, and logistic hell.

True. They do have to fix communications, logistics, deliveries.... They also need to get to 7000/week production. I hope Q3 will get there. We do not have enough leaks from Fremont to know until late in Q3.

 

[LJS22]

When Tesla does good it makes it that much harder to realize what they are doing (due to comparisons to companies that have been around for half a century) but An all electric company is literally growing at a rate that is unfathomable. Based on all the analyst predictions we can conclude that they have no idea where this is going. Truly uncharted territory here.

The easiest way to look at this is go back to 2012 and look at what Elon wanted the company to do and become. Look at interviews from 2014, 2016 and realize he’s doing everything in his vision. Now imagine betting against the rest of his vision. Imagine thinking that China giga is not a big deal, or that Tesla can’t deliver it’s numbers. The hard part is in the past. I see no reason to believe that this company will not continue to defy the odds and chart new ground on a global level.

 

[neroden]

I agree that Tesla failed to get 10k production levels of S+X+3 out of Fremont. However I'm also pretty sure that since the intro of GF China the 10k goal no longer applies.

Looks to me that GF China will pick up 2-4k of Model 3 production which will allow Fremont to produce the Model Y.

Yes. My only point is the financials are not as good if you need more buildings and more paint booths and more stamping machines to produce 10k. GF3 is great, but if they could have sped up Fremont to 10k/week with minimal capes as originally planned it would have been financially better.

 

[EVNow]

I've updated my model with the actual production & delivery numbers.

Bottom line in Q2 : 195M gaap loss, break-even on non-gaap, $1.4B positive operating cash flow.

That cash generation is going to make shorts cry.

Near-future quarterly financial projections

Here is my P&L. Because of some differences in assumptions, it is about $100M more optimistic than @luvb2b model.

Bottom line in Q2 : $195M gaap loss, break-even on non-gaap, $1.4B positive operating cash flow.

View attachment 425821

View attachment 425824

 

[Chunky Jr.]

Buyer : Hi, I'm thinking about an e-tron and a Tesla
E-tron dealer : E-tron is far better
Buyer : What can you tell me about your fart app? I hear Tesla's is really good.
E-tron dealer : Uh, we don't have a fart app
Buyer : I'm no longer interested in e-tron

 

[Artful Dodger]

So M3 production isabout 5900 per week.

Edit for math issue

Q2 5,641/wk
Q1 5,065/wk

...not counting Statutary Holidays. That's an 11.3% increase QoQ. And there's still room to improve since Tesla's goal is 7K/wk Model 3.

Bet this study increase does wonders for unit cost (labor, depreciation) and profitability.

Cheers!

 

[defc0n]

@neroden do you believe there will be any meaningful hangover in Q3 from the lower tax credit in the US (and demand pulled forward into Q2)?

 

[madodel]

It's pretty impressive how Tesla has made a car that has become the must have consumer gadget. People don't want it just because it is a great way to get from A to B, they also want it because they want to participate in the consumer experience provided by the software.

Sounds like something I've heard about before. Oh yeah, people didn't just want a phone, they wanted a computer in their palm that could keep them connected. Amazing how Elon has replicated much of the Apple experience but at a price point 100 times greater. Wall Street didn't understand AAPL 20 years ago and they don't understand TSLA today.