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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Carl Raymond
Active Member
Random thoughts.
Wright’s law tells us COGS will fall 15 percent with a cumulative doubling of production. Examples of this ‘truism’ predate globalised production. It should apply to Fremont, irrespective of expansion via Shanghai.
The focus over the next 6 months will be on GF3 as a profit centre. The factory has better design. The cells come from LG. The packs are made on site. So there’s additional cell movement but an eliminated pack movement.
It’s so different. Is it different because we are seeing application of the learning curve? Or is it different because these are all effects of what it takes to work around arbitrary tariff laws?
What we need to see in coming quarters are COGS figures for US and China production, separated out. Faith in Wright’s law will be bolstered greatly by falling costs in Fremont. It seems possible. Larger orders to suppliers enhance negotiating position. Robotisation will not stop on the East side of the Pacific, just because all eyes are on the West side.
Basically, I don’t want to hear the following...
What did you learn from making a million model 3s?
We learned to make them in China.
Wright’s law tells us COGS will fall 15 percent with a cumulative doubling of production. Examples of this ‘truism’ predate globalised production. It should apply to Fremont, irrespective of expansion via Shanghai.
The focus over the next 6 months will be on GF3 as a profit centre. The factory has better design. The cells come from LG. The packs are made on site. So there’s additional cell movement but an eliminated pack movement.
It’s so different. Is it different because we are seeing application of the learning curve? Or is it different because these are all effects of what it takes to work around arbitrary tariff laws?
What we need to see in coming quarters are COGS figures for US and China production, separated out. Faith in Wright’s law will be bolstered greatly by falling costs in Fremont. It seems possible. Larger orders to suppliers enhance negotiating position. Robotisation will not stop on the East side of the Pacific, just because all eyes are on the West side.
Basically, I don’t want to hear the following...
What did you learn from making a million model 3s?
We learned to make them in China.
Fact Checking
Well-Known Member
Tesla on Twitter
"We're making some updates to Tesla Insurance and will be back online shortly."
Tesla on Twitter
"Algorithm update in progress"
"We're making some updates to Tesla Insurance and will be back online shortly."
Tesla on Twitter
"Algorithm update in progress"
Love Tesla's new social media guy!
AH! For those of us existing Tesla owners asking about insurance, Tesla already knows our driving habits and probably prices insurance accordingly, no??
That's why the wide range of price quotes.
EDIT- I was mistaken. Thanks to @izemize for clearing this up:
From the faq page (Tesla Insurance):
Does Tesla Insurance use driver data to price insurance?
Tesla Insurance does not use nor record vehicle data, such as GPS or vehicle camera footage, when pricing insurance.
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EVNow
Well-Known Member
adiggs
Well-Known Member
I think you've got exactly the right idea about Tesla Insurance - good enough so that anybody stuck with the ridiculously high priced insurance have a readily available alternative, and as loss information gets better and better with AP, has the possibility of forcing down insurance prices for all Tesla drivers.
Tesla can just get away with this being revenue neutral, and it becomes - like the superchargers - an important marketing tool for the ecosystem and product.
EVNow
Well-Known Member
Fact Checking
Well-Known Member
There's a lot of possibilities, but I'm not sure Tesla can or should compete with "bait & switch" rates that many insurers offer to new customers, in hope of catching the most profitable pool of customers that don't mind or don't notice a modest rise in fees in the second year ...
Those rates almost certainly have zero or negative margins. (To traditional insurance companies.)
Fact Checking
Well-Known Member
True - but if the Democratic nominee is going to be uninspiring or gets involved in some serious scandal, a third party candidate might siphon off some votes.
And as we learned in 2016, a few votes can matter too.
Pezpunk
Active Member
With Tesla Insurance, I'm reading the quotes owners are reporting that above their current insurance plans and have been scratching my head initially. But then I thought about the four things that Elon talked about in the last earnings call necessary for high volume Tesla car sales in any geography:
Mr. Musk (Q2 '19 Earnings Transcript): "So, you have to have service, you have to have supercharging and charging well sorted out, you could have good consumer financing and then the price must make sense. And any place where those four things are true, our sales are great. "
Looking at the past pattern, mobile service and financing were not introduced to generate revenues/profits, but to enable car sales. Adding a fifth item that people need to the four things Elon talked about above - it would be "affordable insurance". This might be the last leg needed to achieve affordability for the max audience size in more mature markets - i.e. California.
It sounds like from here and Tesla reddit there have been a few Tesla owners who have found a lower rate from Tesla Insurance than their current plan because their current rates are escalated from previous marks on their driving record. Imagine other potential Tesla buyers (who wanted to trade in lower value cars for a Model 3) who wanted to buy a >$40K car, but found the rates too prohibitive - much higher than the rates they were paying on their economy car they wanted to trade-in. These potential buyers would have never bought the Tesla car.
Now with Tesla insurance, it expands to buyer market to these potential buyers (though adding the risk of insurance adverse selection for Tesla's insurance partner).
Tesla did not introduce insurance to make money selling insurance or to lower existing owner's rates. My theory is that Tesla introduced insurance to sell more cars to a wider audience. This would be why such a small percentage of existing owners are seeing better rates - because the potential owners who would benefit from these rates were previously priced out of buying Tesla cars because of insurance rates available to them prior to Tesla insurance being available.
This theory would be proved out if we see much higher adoption by new car buyers of Tesla insurance in California than in the existing owner base. That being said - Once Tesla insurance comes back online, it could turn out pricing has been upended and this theory is pure conjecture.
Mr. Musk (Q2 '19 Earnings Transcript): "So, you have to have service, you have to have supercharging and charging well sorted out, you could have good consumer financing and then the price must make sense. And any place where those four things are true, our sales are great. "
Looking at the past pattern, mobile service and financing were not introduced to generate revenues/profits, but to enable car sales. Adding a fifth item that people need to the four things Elon talked about above - it would be "affordable insurance". This might be the last leg needed to achieve affordability for the max audience size in more mature markets - i.e. California.
It sounds like from here and Tesla reddit there have been a few Tesla owners who have found a lower rate from Tesla Insurance than their current plan because their current rates are escalated from previous marks on their driving record. Imagine other potential Tesla buyers (who wanted to trade in lower value cars for a Model 3) who wanted to buy a >$40K car, but found the rates too prohibitive - much higher than the rates they were paying on their economy car they wanted to trade-in. These potential buyers would have never bought the Tesla car.
Now with Tesla insurance, it expands to buyer market to these potential buyers (though adding the risk of insurance adverse selection for Tesla's insurance partner).
Tesla did not introduce insurance to make money selling insurance or to lower existing owner's rates. My theory is that Tesla introduced insurance to sell more cars to a wider audience. This would be why such a small percentage of existing owners are seeing better rates - because the potential owners who would benefit from these rates were previously priced out of buying Tesla cars because of insurance rates available to them prior to Tesla insurance being available.
This theory would be proved out if we see much higher adoption by new car buyers of Tesla insurance in California than in the existing owner base. That being said - Once Tesla insurance comes back online, it could turn out pricing has been upended and this theory is pure conjecture.
It is also true that setting insurance rates can be tricky, initially, and needs fairly constant adjustment...
If Tesla beats every other company on rates all the time, that isn't necessarily good..
I think Tesla is probably looking to control the cost of repairs by using their own body shops.
It is going to take a few years for Tesla to get really good at insurance, they have probably acquired a company with experienced staff, but they need to see how their model operates in the real world.
I'm sure it is also about making cars more affordable... so it is a demand lever....
Already time to panic! Water and bread almost gone from the grocery stores.
This is Titusville, the town North of Cocoa, and across from Kennedy Space Center.
Observation: Cocoa, FL (one of the two Starship production sites) is right in the middle of the NHC Dorian track:
Thankfully, they just finished this:
It also sets up Tesla to develop a commercial insurance product available for ridesharing. This is important since most personal insurance policies won't cover your personal vehicle being used for ridesharing.
Mike Smith
Active Member
Fact Checking
Well-Known Member
Observation: Cocoa, FL (one of the two Starship production sites) is right in the middle of the NHC Dorian track:
Thankfully, they just finished this:
Unfortunately that shelter is probably not enough for the potentially category 4 or 5 storm that some models are predicting would hit the Space Coast in 4-5 days:
Some models are also predicting a stall, which might further increase cumulative rainfall. Combined with the King Tide around August 30 flooding would be a major concern as well.
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MTL_HABS1909
Active Member
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