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

[Drax7]

I was screening for stocks that have sequential revenue growth,
That is sales that grow every quarter . A Characteristic present in
the “ tornado phase “.

Which brought to my attention two stocks
With sequential sales growth over several years, Match and Shake Shak.
Both had huge Price increases in the last few days,
But another characteristic was they were
Both heavily shorted.

Tesla had sequential growth for the last
5 years every quarter until the first quarter
Of this year.

In the second qtr of this year they again reverted
To sequential sales growth, and moreover the short interest
Is near its highs. If tesla can maintain sequential
Growth, the stock will rally .

We should expect sequential growth in the 3rd and 4th qtr
According to guidance.

 

[Antares Nebula]

I am not trying to be defensive, but your statement clearly said "and that a relatively Inferior Model S,X to the 3 (not in all, but in certain important aspects) is affecting S,X sales" is clearly saying that part of the reason that S,X sales are suffering is because they are "relatively" inferior to the 3, and I heartily disagree. I am simply asking you for an example of the important aspect that is inferior on the S,X compared to the 3 that would affect someone's purchasing decision.

Uh, was that not clear in my original post? Battery pack for starters. I'm sure that this is a deciding factor for some of the customers (myself included). If you want to say that we're being dumb, well then that's your prerogative. But I for one will not be plopping down $100k for an S that does not have V3 SC capability and low battery fire probability, like M3. Now, if I was rolling in the dough, then yes, and then I would upgrade later to the new S. But everybody is different and have different criteria and values. Sure, many will get Raven, but many also will wait.

This is just one feature. There may be other tech and non-tech features that others may be looking for, like an updated interior/exterior. Maybe a HUD (getting rid of the smaller screen), and making the center screen horizontal, etc., etc.

Yes, cannibalization is a factor, but it is not merely the availability of a cheaper Tesla that is affecting S,X sales.

If it's so good, why the FUSC promo? I bet they won't offer that when they finally do the S,X upgrades.

My guess, without FUSC, S,X will do between 15-20k a quarter. When they finally upgrade with better battery pack and other features, it will be 20-25k a quarter at minimum, maybe even 30k.

 

[mongo]

My guess, without FUSC, S,X will do between 15-20k a quarter. When they finally upgrade with better battery pack and other features, it will be 20-25k a quarter at minimum, maybe even 30k.

Does that upgrade include 2170s? Without the SR version, they do not have sufficient 18650 supply (based on previous build volumes) to produce 120k a year. I've seen the number 85k/ yr thrown out as the 100kWh pack capacity.

 

[MP3Mike]

My guess, without FUSC, S,X will do between 15-20k a quarter. When they finally upgrade with better battery pack and other features, it will be 20-25k a quarter at minimum, maybe even 30k.

With the current pack size and cell supply they can only make about 20k/quarter, so they don't need more demand than that.

But I for one will not be plopping down $100k for an S that does not have V3 SC capability and low battery fire probability, like M3.

The rumor is that the E rev pack in the Raven Model S/Xs has the low probability of fire as well. But nobody has volunteered to have their pack torn apart to confirm it. And it does have V3 Supercharging capability, just only up to 200kW instead of 250kW. (But it can likely maintain that 200kW longer than a Model 3 can maintain the 250kW.) It would be good to see some Raven charging reports from the new V3 Supercharger in Las Vegas.

 

[Antares Nebula]

Does that upgrade include 2170s? Without the SR version, they do not have sufficient 18650 supply (based on previous build volumes) to produce 120k a year. I've seen the number 85k/ yr thrown out as the 100kWh pack capacity.

I cannot speak to the supply constraints, but yes it should be good as or better than 2170 cell/pack architecture. This may mean 2170 cells or some new battery tech (e.g., Maxwell, etc.).

 

[tschmidty]

Uh, was that not clear in my original post? Battery pack for starters. I'm sure that this is a deciding factor for some of the customers (myself included). If you want to say that we're being dumb, well then that's your prerogative. But I for one will not be plopping down $100k for an S that does not have V3 SC capability and low battery fire probability, like M3. Now, if I was rolling in the dough, then yes, and then I would upgrade later to the new S. But everybody is different and have different criteria and values. Sure, many will get Raven, but many also will wait.

This is just one feature. There may be other tech and non-tech features that others may be looking for, like an updated interior/exterior. Maybe a HUD (getting rid of the smaller screen), and making the center screen horizontal, etc., etc.

Yes, cannibalization is a factor, but it is not merely the availability of a cheaper Tesla that is affecting S,X sales.

If it's so good, why the FUSC promo? I bet they won't offer that when they finally do the S,X upgrades.

My guess, without FUSC, S,X will do between 15-20k a quarter. When they finally upgrade with better battery pack and other features, it will be 20-25k a quarter at minimum, maybe even 30k.

So the fact that it can only charge at 200Kw versus 250Kw (which I did mention) is the deciding factor in your purchasing decisions. So having 20% faster charging for, what, about the first 5 minutes of supercharging? So 1 minute faster charging is how you think "many" people judge a 100k purchase.

Agree to disagree and let's drop it as off topic.

 

[Antares Nebula]

With the current pack size and cell supply they can only make about 20k/quarter, so they don't need more demand than that.

Okay, but they're offering FUSC to stoke demand. Let's not rationalize too much.

 

[ggr]

Okay, but they're offering FUSC to stoke demand. Let's not rationalize too much.

I disagree with the word "stoke". Tesla has demonstrated great ability to "fine tune" demand. They don't want to produce more than they can sell, and any time it looks like that might happen, they release some incentives. I don't see why that's a problem, and on the contrary, I think it is very smart. I can't remember the exact words, but Elon has repeatedly said "demand is not a problem, there are all sorts of things we could do to increase demand."

 

[ggies07]

That was the most blatant hit piece I've ever seen on CNBC! It segued into whether their accounting numbers were trustable which was obviously set up. This is not off-the-cuff banter as they make it appear.

Let's follow this: America Made Product - trashed by Media due to special interest - special interests only care about profits - sitting president rants about "America First" - American Made Product releases more products - Media trashes again.

So who's getting played here? The uneducated become the manipulated.

The back and forth manipulation is astounding between all these outlets. The product must really speak for itself and it does. Tesla makes ****ing amazing products.

 

[kengchang]

Ihors update

 

[Nocturnal]

I should start selling violins

Do you have any really tiny ones?

I have little doubt the plan is to eventually make Model S/X a lot better, but that is the last thing Elon can say publicly now..

It is also likely the budget for improvements is not unlimited and the likely future revenue stream is a consideration. IMO there is no need to change the exterior shape of the cars at all.

I think his response that they don't do major refreshes, and instead just steadily change things made a lot of sense. What do model S and X owners want? I don't hear a consistent answer, they just don't want the "old" version. Update the seats here, dashboard there, new exterior trim there etc. If Tesla makes this their model it's actually very smart. Model refreshes really lower value on the previous models and are pretty arbitrary. Smaller changes make more sense for many reasons.

 

[Mars ☰mperor]

So it’s been exactly 1 year since “Funding Secured”.

What a year. Never a dull day.

 

[Antares Nebula]

I disagree with the word "stoke". Tesla has demonstrated great ability to "fine tune" demand. They don't want to produce more than they can sell, and any time it looks like that might happen, they release some incentives. I don't see why that's a problem, and on the contrary, I think it is very smart. I can't remember the exact words, but Elon has repeatedly said "demand is not a problem, there are all sorts of things we could do to increase demand."

I somewhat agree with this. But you're taking Elon's quote out of context. That was referring to Model 3. And there, I completely agree. But even on the recent earnings calls, Elon was at a loss to explain the lack of demand for S,X:

"Toni Sacconaghi

Okay. Thank you for that. If I could just follow-up. Elon, I'm wondering, if you can comment on whether you believe Model 3 is having any cannibalization impact on S and X sales or why you think that – or why else there might be sort of a structural step down in the demand and delivery levels relative to what we’ve seen over the last five or six years?

Elon Musk

Actually, we're just talking about this earlier today. We're not quite sure ourselves. I think there's some cannibalization, maybe false expectation in the market that there's like some big overhaul coming for S and X, which would then cause people to hesitate to buy, if they think there's some like radical redesign coming, which is why I've stated publicly that this is not the case.

The Model S and X today are radically better than the ones that – when we first started production, especially S. Like say like 2013 or 2012 Model S compared to today's Model S night and day. In fact, I still run into people I know, who have like 2013 Model S, and they think it hasn't changed. And like it is dramatically better in every way. But we don't do model years. We just roll in improvements as they come. So – but I think there is maybe a communications issue, where people don't realize just how much better the S and X are today than when we first started.

And I think we actually want to address that communications issue and just get a better understanding of– from the front lines like what demand should be higher for S and X than it is and will get to the bottom of it and fix it."

 

[Etna]

So it’s been exactly 1 year since “Funding Secured”.

What a year. Never a dull day.

It could have been worse, we are only $10 away from $240.

 

[Nocturnal]

Looks like that Koch brothers lobbying against renewable energy is getting some help from the WSJ. It is not surprisingly not paywalled. Any WSJ people who want to hit the comments, I'm sure they will be toxic. They make a lot of unsubstantiated claims about vast sums of energy and resources required to make wind, solar and batteries relative to resource requirements for oil. The tone of the article was very John Peterson, perhaps he has a pupil.
A google of Mark P Mills, shows he is a physicist with the Manhattan Institute. Manhattan Institute is a free market dedicated group, but seem focused on large corporate freedom, not competitive freedom. Saying you are dedicated to Oligopoly is not a compelling a mission statement though. Any science and stats people want to follow them on twitter, they could use some counterfacts.

Opinion | If You Want ‘Renewable Energy,’ Get Ready to Dig

It's crazy but I still have arguments with Tesla owners even about renewable energy. So many are clueless and insist that wind/solar are not practical etc. Despite the fact that they are now cheaper than coal.

 

[kbM3]

What about the S or X is so inferior that I would possibly want a Model 3 instead? If I need/want a larger vehicle with seating for 7 and can tow 5000lbs, what is so god awful inferior about the X that I would not buy one because the 3 is, ? better? I like my wife's Model 3 but it does not fit my needs as my primary vehicle. I consider myself fairly well informed but if I were in the market for a new vehicle, explain why the existence of the 3 would make me not want an X?

I think it is cannibalizing sales of course, simply because it is half the price, not because it can only charge at 200KW or..., well I can't think of another major reason.

I am not trying to be defensive, but your statement clearly said "and that a relatively Inferior Model S,X to the 3 (not in all, but in certain important aspects) is affecting S,X sales" is clearly saying that part of the reason that S,X sales are suffering is because they are "relatively" inferior to the 3, and I heartily disagree. I am simply asking you for an example of the important aspect that is inferior on the S,X compared to the 3 that would affect someone's purchasing decision.

There are lots of reasons S,X sales are lower without (falsely IMO) saying they are inferior products to the 3, and that is the part of your statement I was addressing. I'd also question what upgrades you expect to come that would drive sales without driving up price. I don't think new colors or new interior panels will drive sales and range is the only thing I see happening.

That said, I do think the higher models should to be priced lower to really match the value of the 3. Or accept, as Elon does, that they are going to remain niche products and sales will be lower since some people that could have stretched to buy an S will get a 3 instead.

All that said, I still really want an X!

In addition to lower cost the Model 3 is superior in:
1) It’s lighter
2) It’s center of gravity is lower
3) It’s polar moment of inertia is less.


I.e. It is more agile, more nimble and It handles far better than Model S or X. One can argue that is not an important characteristic for themself, but one can not argue that it is an area in which the Model 3 is demonstrably superior.

 

[Driver Dave]

Looks like that Koch brothers lobbying against renewable energy is getting some help from the WSJ. It is not surprisingly not paywalled. Any WSJ people who want to hit the comments, I'm sure they will be toxic. They make a lot of unsubstantiated claims about vast sums of energy and resources required to make wind, solar and batteries relative to resource requirements for oil. The tone of the article was very John Peterson, perhaps he has a pupil.
A google of Mark P Mills, shows he is a physicist with the Manhattan Institute. Manhattan Institute is a free market dedicated group, but seem focused on large corporate freedom, not competitive freedom. Saying you are dedicated to Oligopoly is not a compelling a mission statement though. Any science and stats people want to follow them on twitter, they could use some counterfacts.

Opinion | If You Want ‘Renewable Energy,’ Get Ready to Dig

"When electricity comes from wind or solar machines, every unit of energy produced, or mile traveled, requires far more materials and land than fossil fuels. That physical reality is literally visible: A wind or solar farm stretching to the horizon can be replaced by a handful of gas-fired turbines, each no bigger than a tractor-trailer."


They do this by not factoring in the vast materials and land infrastructure required to extract and transport fossil fuels.

It is like saying my gas car only needs this engine and small fuel tank - while ignoring the huge offshore oil rig supplying it.

 

[TheTalkingMule]

Model S never really had the great exterior design that was envisioned(and supposed to be done by FIskar). The Model X is just straight up unpleasant to look at. Both sold well because they were amazing ground-breaking vehicles, but are now being cannibalized by M3 and the prospect of MY.

They'll refresh MS exterior a bit soon and do a bigger overhaul on MX I'm sure. Can we just give it a rest now?

 

[MP3Mike]

Okay, but they're offering FUSC to stoke demand. Let's not rationalize too much.

And what's your point? Tesla should do what is needed to maintain a demand of ~20k/quarter. If FUSC does that great, as it is one of the cheaper demand levers. If it requires door pockets/coat hangers then they should do that. But I think that they should spend the most minimal of effort/money on updating the S&X at this time.

 

[StarFoxisDown!]

Model S never really had the great exterior design that was envisioned(and supposed to be done by FIskar). The Model X is just straight up unpleasant to look at. Both sold well because they were amazing ground-breaking vehicles, but are now being cannibalized by M3 and the prospect of MY.

They'll refresh MS exterior a bit soon and do a bigger overhaul on MX I'm sure. Can we just give it a rest now?

Eh I actually love the S exterior.....it should be pointed out that it's stayed "in style" for like 5 years now without a full refresh which is a really impressive thing. I also find the balance between standing out and not being too unique is perfect. The S is meant for the everyday commute with some style and can hold a family. I think you take some cues from the Roadster 2 like the front end and lights and the rear lights and put that in the S but besides that, I think the design is close to perfect.