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

[Mars ☰mperor]

So track mode for Model S then?

Just with one OTA, and the Porsche Taycan is beaten.

 

[bhtooefr]

Maybe the Audi Etron is a threat? - I have to do more research.

The Étron is not a threat - hideously bad range (204 miles EPA on a 95 kWh nominal/83.6 kWh usable pack), not very big inside, etc., etc.

The Étron GT concept is based on the Taycan, so I'm not expecting it to be any better than the Taycan.

(Probably less than 5% of Porsche buyers are using them on the tracks, so track performance does not matter, even if they have 4 vomit bags installed for the experience. )

I suspect for a significant portion of Porsche buyers, the capability is important. They'll never use it, but they want to brag about the possibility of using it.

Panamera: 11.5% CAGR (actually was declining for 2014-2017, when a refresh came out and significantly boosted the numbers)

That's because the first-generation Panamera was widely seen as fugly, so the market for a Porsche sedan existed but refused to buy that car. The generation change solved that.

True story:

My sister in Dunedin finally got her Model S about a month ago (Yay! Bless her! Boo! She didn’t use my code!). But bro-in-law - a died-in-the-Romney X Merino Kiwi if ever there is one, quickly stopped driving it after too many left/right-turn wiper blades.

Something something something Coriolis...

IIRC, you also have a thing where European-brand RHD cars have the stalks in the same location as LHD cars, whereas Japanese-brand RHD cars have them mirrored from LHD cars (so their turn signal is on the right, wipers are on the left)? Looks like Tesla went for the European norm (turn signal on the left, shifter on the right for all cars).

 

[SO16]

I saw an Electrify America station for the first time the other day still wrapped in plastic at a Target in the Seattle Area. They had CCS plugs. There is no adapter available Tesla-CSS that in the US market is there?

Not yet unfortunately. Can use the Chaedemo though.

 

[FreqFlyer]

I’d think so too. Perhaps Tesla itself went incognito, or hired someone to time a lap, and saved that time.

When Porsche announced their time and Elon saw it was slower, it was time to pounce.

Perfect .

If Tesla S was lapping in record times, word would have gotten out, there are people who are tat the Ring everyday on the lookout for prototypes testing. Heck, word would have gotten out that there is a Tesla period, on the Ring.

 

[sparcs]

But at some point the market has to pay consideration to how it values cash piles trapped overseas that cannot practically be returned to shareholders. This will be the case with Tesla and China for the foreseeable future.

Anyone care to offer any academic view on the likely market discount to Tesla’s China cashflows from Giga 3? Perhaps with Apple’s prior trapped cash problem as an imperfect precedent?

What year are you predicting cash piles trapped overseas that need to be returned to shareholders?

They will likely build multiple gigafactories in china over time and expand their product line. Tesla Storage and Semi would make sense in China.

 

[Causalien]

To the Cathie Wood disciples.

She hypothesises that yield inversion is caused by the depression of energy prices caused by technological disruption, improving productivity along the economic supply chain and boosting real household disposable incomes.

Let’s look at the UK energy market, a country which has also experienced yield inversion:

View attachment 451053
View attachment 451055

Not any obvious deflationary impact happening from energy prices in the UK. Perhaps yield curves are reflecting future expectations of energy prices by market participants? Ok, well in that case why isnt Tesla at $1000 with its bonds trading above par, while Exxon is only 30 odd percent off its +$100/bbl peak?

The Ark thesis might sound an attractive story if your personal bias is for a fossil free world, but it has a lot of work to do to prove its case. There’s a more obvious answer to deflation expectations and flattening / inverting yield curves in much of the world, which is that we’re heading for a global recession sometime in 2020/1.

There is in fact excellent technical and anecdotal data that means you should give the recession answer far more credibility than the “deflationary boom” answer which not coincidentally helps Kathy Wood in marketing her disruption investment funds.

Weak US manufacturing data, weak German industrial (and overall production) data, as many Chinese bonds defaults YTD than in 2017-2018 combined, rising gold price despite strengthening dollar... there will be others apart from me privy to non public touchpoints on global economic health. What I see scares me.

And this is without discussion of increasingly unfavourable demographics in many of the world’s biggest economies.

The debate I hear every day is not whether the world economy is in good or bad shape, that seems a fairly settled argument among finance professionals. The debate now is whether the Fed have sufficient firepower / will to launch a big bazooka and keep the cycle going another couple of years.

My guess is they will have TSLA China buy battery from TSLA battery usa colorado plant and use that to transfer excessive cash back to USA.

But a better idea is to just IPO TSLA china in their new tech index and have the price in that index buoy the price in USA.

 

[MTL_HABS1909]

Porsche’s Nürburgring time was set with a pro driver.

Dear Tesla:

Put Leilani Münter behind the wheel to beat Porsche’s time.

Then find an overweight baby boomer who’s an amateur driver to beat Porsche’s time.

Then do it with a soccer mom from Beverly Hills.


Signed,
The best marketing person you’ve ever stolen ideas from

I’d actually love to see Nico Rosberg at the wheel. A German F1 champ, on a German circuit, beating the best EV Germany could come up with. What a smack in the face that would be!!!!

Note: If you check out his YouTube channel, it’s obvious he loves Tesla!

 

[Todd Burch]

If Tesla S was lapping in record times, word would have gotten out, there are people who are tat the Ring everyday on the lookout for prototypes testing. Heck, word would have gotten out that there is a Tesla period, on the Ring.

Isn’t there a way to get private closed track time?

 

[Singuy]

The biggest disappointment about the Taycan is the price. Have a MD who is into the EV future ended up disappointed that the price is 2x more than everyone thought. No one wants to pay 180k to beta test a car for Porsche. People only did it for Elon (at a cheaper price) but it was a time when there's no other choice. Now there's a choice, a significantly better one at that.

 

[KarenRei]

AC induction motors do not have windings (as such) in the rotor. They have a shorted squirrel cage (single turn).
Both types have windings in the outer stator.
The Tesla AC motor's rotor is liquid cooled via a coaxial tube setup on the non gear end.
The PMSR has direct oil cooling of the stator (and rotor to some extent).

The problem is AFAIK twofold.

1) You generate more waste heat in an induction motor, period

2) You can always increase the surface area of a stator (and it has more surface area to begin with). You can't do the same with a rotor without inducing drag and reducing motor power.

They got the details wrong (air cooling vs. oil cooling, windings vs. squirrel cage), but the general point is AFAIK correct.

 

[FreqFlyer]

Tesla has been known to use Laguna Secca, so maybe they tuned up there.

 

[Thekiwi]

Concerning Market Valuations for onshore China cashflows.

Good to see Giga3 getting closer to fruition. Of note Giga 3 and any future associated revenue falls under an onshore WOFE (wholly owned foreign enterprise).

This was a triumph of negotiation and means Tesla does not have to share the goodies with a local partner.

But:

Since 2016 it’s been very difficult for WOFEs to offshore any surplus cashflows due to ever more stringent capital controls. The same for domestically owned private enterprises too for that matter.

This doesn’t practically matter for now because Tesla will be reinvesting all surplus yuan back into further onshore growth.

But at some point the market has to pay consideration to how it values cash piles trapped overseas that cannot practically be returned to shareholders. This will be the case with Tesla and China for the foreseeable future.

Anyone care to offer any academic view on the likely market discount to Tesla’s China cashflows from Giga 3? Perhaps with Apple’s prior trapped cash problem as an imperfect precedent?

beyond the obvious China focused reinvestment opportunities (factory expansion for more models & cells, retail stores, supercharger networks etc), one way to "release" cash from china is for vehicles being exported to non-china markets, in which case Tesla USA collects all money for sales made in other countries, but the entire cost to produce car is allocated to Tesla China.

eg: someone buys a $40k model 3 in Taiwan - $40K goes to Tesla bank account in USA, and Tesla China spends $25K building and shipping the car to Taiwan.

 

[S3XY]

Driving the Future with a great take on the Taycan.

 

[mrmage]

Why are people speculating about a new S variant? It's not effective marketing for the S if it's something you can't buy. Rather, it'd be osbourning the S if it's something that's not out yet.

Unless Tesla was going to make it available anyway, or make it available through a software update.

 

[KarenRei]

beyond the obvious China focused reinvestment opportunities (factory expansion for more models & cells, retail stores, supercharger networks etc), one way to "release" cash from china is for vehicles being exported to non-china markets, in which case Tesla USA collects all money for sales made in other countries, but the entire cost to produce car is allocated to Tesla China.

eg: someone buys a $40k model 3 in Taiwan - $40K goes to Tesla bank account in USA, and Tesla China spends $25K building and shipping the car to Taiwan.

There's so many different offshoring tricks used for different purposes.

Over here we've been being played for ages by the alumium smelters which use a tax avoidance scheme. They set their local operations up as subsidiaries in debt to the parent corporation, and servicing their debt prevents them from ever earning a profit, while the parent company rakes in all the cash. They also pull the "we're not profitable, you'll ruin us and the jobs we provide!" line whenever the government wants to pass legislation that they don't like - of course, their bankruptcy would just mean that their parent companies would get their assets.

I really think that "Tesla's ability to repatriate the mountains of cash that it's going to generate in the future in China" is at the bottom of most investors' minds right now. It'd be a great problem to have, and if there ever were a need, I'm sure they'd find a decent way to do so regardless - either that, or just hold onto it until a favourable administration passes favourable legislation concerning the repatriation of assets.

 

[Navin]

Next week would be a good time to release the upgraded Tesla model S. Basically slap Porsche in the face. Crushed at half the price.

 

[Artful Dodger]

Concerning Market Valuations for onshore China cashflows.

Good to see Giga3 getting closer to fruition. Of note Giga 3 and any future associated revenue falls under an onshore WOFE (wholly owned foreign enterprise).

This was a triumph of negotiation and means Tesla does not have to share the goodies with a local partner.

But:

Since 2016 it’s been very difficult for WOFEs to offshore any surplus cashflows due to ever more stringent capital controls. The same for domestically owned private enterprises too for that matter.

This doesn’t practically matter for now because Tesla will be reinvesting all surplus yuan back into further onshore growth.

But at some point the market has to pay consideration to how it values cash piles trapped overseas that cannot practically be returned to shareholders. This will be the case with Tesla and China for the foreseeable future.

Anyone care to offer any academic view on the likely market discount to Tesla’s China cashflows from Giga 3? Perhaps with Apple’s prior trapped cash problem as an imperfect precedent?

GF3 is in the new Shanghai free-trade zone. If the Gov't want to attract further large foreign manufacturers to Lingang (as they say they do), they'll have to live up to their word on free trade.

Right now, I think China mostly wants the actual products Tesla will build. With a local factory, they are much less likely to get cut off from supply for political reasons.

 

[mongo]

I really think that "Tesla's ability to repatriate the mountains of cash that it's going to generate in the future in China" is at the bottom of most investors' minds right now. It'd be a great problem to have, and if there ever were a need, I'm sure they'd find a decent way to do so regardless - either that, or just hold onto it until a favourable administration passes favourable legislation concerning the repatriation of assets.

Maybe buying cells/ raw materials/ parts for GF1, 2, and 4? Unlike Apple or Microsoft, Tesla needs a significant quantity of physical matter to make their products. (Or does the importation go onto the local factory's books?)

 

[Thekiwi]

There's so many different offshoring tricks used for different purposes.

Over here we've been being played for ages by the alumium smelters which use a tax avoidance scheme. They set their local operations up as subsidiaries in debt to the parent corporation, and servicing their debt prevents them from ever earning a profit, while the parent company rakes in all the cash. They also pull the "we're not profitable, you'll ruin us and the jobs we provide!" line whenever the government wants to pass legislation that they don't like - of course, their bankruptcy would just mean that their parent companies would get their assets.

I really think that "Tesla's ability to repatriate the mountains of cash that it's going to generate in the future in China" is at the bottom of most investors' minds right now. It'd be a great problem to have, and if there ever were a need, I'm sure they'd find a decent way to do so regardless - either that, or just hold onto it until a favourable administration passes favourable legislation concerning the repatriation of assets.

ugh smelters are the worst! We have just one in New Zealand, but it uses 13% of the nations electricity!! Most people would just prefer it shut down, but politicians fear losing a few thousand jobs (which is tiny in the grand scheme of things, and plenty of opportunity to replace with something else)

 

[Dutchie]

So next week Models S on the track and release of V10 for early access. Next week, according to Elon, next week Elon ..tick, tock, tick tock tick - next week - tock