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

[Causalien]

More significant than how many cars were produced or delivered in the current quarter would be when the production ramp happened. If it took a while to gear up they could finish the quarter with production capacity well above that which they entered the quarter without delivering more than 105K. Personally, I think they will beat 105K but am more interested in weekly production numbers, ASP's and cost efficiency gains.

TSLA is trading as if these things are going to be relatively flat Q over Q but my instinct tells me things are way better than investors are giving them credit for.

In my own valuation, tsla should get back to $280 if it manages to keep up with previous production goals. 10k / week. We all know it's not possible until gf3. So q2 2020.


I am really hoping for some kind of muddle through till then as I have a huge chunk of cash tied up coming free in mid 2020.

Actually talked to my bank about freeing up the asset by taking out a asset backed line against it, unfortunately the interest rate is insanely high at 8%... On almost cash like assets. My reputation sucks compared to TSLA.

 

[kengchang]

In my own valuation, tsla should get back to $280 if it manages to keep up with previous production goals. 10k / week. We all know it's not possible until gf3. So q2 2020.


I am really hoping for some kind of muddle through till then as I have a huge chunk of cash tied up coming free in mid 2020.

Actually talked to my bank about freeing up the asset by taking out a asset backed line against it, unfortunately the interest rate is insanely high at 8%... On almost cash like assets. My reputation sucks compared to TSLA.

Just no

Joseph Osha -- JMP Securities LLC -- Analyst

And just as a follow on then, could we see you manage to make 8,000, 7,500, 8,000 Model 3s in Fremont by the end of the year, you think?

Elon Musk -- Chief Executive Officer

Yes.

Joseph Osha -- JMP Securities LLC -- Analyst

Okay. Thank you very much.

Elon Musk -- Chief Executive Officer

I mean, I feel confident, it's -- let's just say that the trend is very clearly toward being able to get to 10,000 vehicles a week, of which that would be -- there is rough numbers like 8,300 to 8,600 Model 3s and the balance in S and X. So there's sort of 1,600 to 1,800 S/X. In round numbers, 8,500 3s, 1,500 S/X per week, but probably a bit more than that.

 

[RobStark]

ID.3 being manufactured.

 

[204EV]

ID.3 being manufactured.

DRUM brakes in the rear............... WHAT!

VW EXECS: We are going super futuristic and cutting edge tech

VW enginners: What about these brakes from 1946

VW EXECS: PERFECT!

 

[lascavarian]

Looks like the quarter is going to be Osborned by the youtubers. Speculation that the Y production line is about to roll. Only 3 weeks needed to put up a line... This sooooo pisses me off! For a few views they will gladly freeze buyers for 6 months. If I was king they dam sure would never get invited to another event.

 

[S3XY]

I vote for breakout.

Breakout
(hold Ctrl key and click link, X key to start)

 

[KarenRei]

Looks like the quarter is going to be Osborned by the youtubers. Speculation that the Y production line is about to roll. Only 3 weeks needed to put up a line... This sooooo pisses me off! For a few views they will gladly freeze buyers for 6 months. If I was king they dam sure would never get invited to another event.

As I big Tesla fan, I have to say: sometimes I hate Tesla fans.

"Wow, amazing release last week - great job Tesla, I'm so stoked! But did you hear, my friend's cousin's former roomate said that an EVEN BETTER THING will be coming out next week! I'm SO waiting for that, and YOU SHOULD TOO!"

Anyone who thinks that Model Y will be coming out in a couple weeks is an idiot. Literally nothing is ready for it. GA5 - which is probably for Model 3 to begin with, as Tesla has been pulling out all the stops to bring production up to their design spec - would be the tiniest fraction of the total. Literally nothing else is ready. Heck, they only started clearing space for the tooling last quarter.

 

[sparcs]

Looks like the quarter is going to be Osborned by the youtubers. Speculation that the Y production line is about to roll. Only 3 weeks needed to put up a line... This sooooo pisses me off! For a few views they will gladly freeze buyers for 6 months. If I was king they dam sure would never get invited to another event.

not just social media getting caught up. Here's another round of bad analysis from one of the EV blogs. Sounds like someone is reading way to much into a job posting...

It Appears A New Tesla Fremont Assembly Line Is In The Works

Branching out from vehicle production, it has already been all but confirmed that Tesla will be setting up a battery assembly line at the Fremont factory soon.

 

[Dwdnjck]

How are TSLA bonds doing ..? asking for a F (riend) ...[/QUOTET


Tesla 2025 5.3% bonds are priced at $89.50, yield to maturity is 7.3%.

 

[Artful Dodger]

may have passed some short of weird tipping point in the UK

I see what you did there

Cheers!

 

[heltok]

If reports about Model Y are true:

Let’s say Tesla are planning Q4 production start and Q1-Q2 ramp. Let’s assume that Tesla sees a steady state of 8k Model 3/week and will shift production to 5k+5k (3+Y) Freemont and 3k+1k China by Q3 and 2k+6k China by Q4. Then the question is will they be able to ramp batteries today to Q2 from 8k/week to 10k/week? Imo this should be possible almost by only maxing out current capacity. And then they can plan for Maxwell+Grohmann+Dahn Tesla cell line around Q3-Q4 which should supply Semi, Pickup, Roadster, S+X and then also more Y for GF4. Seems like a plausible route to me?! Your thoughts.

 

[SoGA Fan Club]

As I big Tesla fan, I have to say: sometimes I hate Tesla fans.

"Wow, amazing release last week - great job Tesla, I'm so stoked! But did you hear, my friend's cousin's former roomate said that an EVEN BETTER THING will be coming out next week! I'm SO waiting for that, and YOU SHOULD TOO!"

Anyone who thinks that Model Y will be coming out in a couple weeks is an idiot. Literally nothing is ready for it. GA5 - which is probably for Model 3 to begin with, as Tesla has been pulling out all the stops to bring production up to their design spec - would be the tiniest fraction of the total. Literally nothing else is ready. Heck, they only started clearing space for the tooling last quarter.

What I don't understand is Musk commented to someone on twitter who found a SpaceX permit and told them what it was for. I wonder why he doesn't clear up the GA5 thing. Then again, he does have more leeway with what he can say about SpaceX than Tesla.

 

[CaliBear1]

I wonder if these type of articles is what’s driving TSLA stock price up, looks like Germany’s big-3 are no longer dragging their feet when it comes to EVs. The race is on and Tesla is the standard to beat.

Automakers turn on style to try to switch SUV fans to electric

Now a generation of new chief executives including Daimler's Ola Kaellenius, BMW's Oliver Zipse and Volkswagen's Herbert Diess are attempting to recast the industry's image with fresh modern designs and cars that pollute less.

“We have moved on from treating the electric car mainly as an engineering challenge. Now electric cars are getting sexy,” Gorden Wagener, Chief Design Officer at Mercedes-Benz parent Daimler told Reuters.

“Design can speed up change and the acceptance of new technologies," BMW's design chief Adrian van Hooydonk said at the carmaker's press conference on Tuesday.

Frankly, this sounds like a whole lot of Hooydonk!

 

[sparcs]

If reports about Model Y are true:
Your thoughts.

you're dreaming along with that youtuber. Not even remotely in line with Tesla's guidance for Y.

 

[mongo]

GA5 - which is probably for Model 3 to begin with,

Somebody's antsy for their delivery ...

Why, when they have said Y will be more popular than 3, would they put in another 3 line instead of a Y one? Unless they can't keep the srung structure.

 

[EVNow]

As I big Tesla fan, I have to say: sometimes I hate Tesla fans.

Along same lines - I've to say the whole idea of progressively pumping the P&D estimates is not appealing to me. I much prefer a surprise on the upside - rather than buy the rumor and sell the news.

 

[KarenRei]

Somebody's antsy for their delivery ...

Why, when they have said Y will be more popular than 3, would they put in another 3 line instead of a Y one?

Because I literally just pointed out that they're still well behind their target Model 3 production out of Fremont and quite 3-production constrained? Because they've literally said that they plan to increase 3 production this year? Because they've literally said that they don't plan on Y production until next year? The goal to meet estimated global demand is 500k (stretch: 700k) Model 3s per year and 700k (stretch: 1M) Model Ys per year. Does it look like they're making 500k (let alone 700k) Model 3s per year?

3 GAs can always with (relatively) minimal effort be converted to Y GAs. But GA is the least relevant thing that needs to be done before Y can come online. They need more body capacity, paint capacity, stamping capacity, moulding capacity, supplier capacity, cell capacity, pack capacity....

 

[mongo]

Because I literally just pointed out that they're still well behind their target Model 3 production out of Fremont and quite 3-production constrained?

3 GAs can always with minimal effort be converted to Y GAs. But GA is the least relevant thing that needs to be done before Y can come online. They need more body capacity, paint capacity, stamping capacity, moulding capacity, supplier capacity, cell capacity, pack capacity....

It's possible the timing makes sense for a temp 3 line, but I'm not seeing it. They've been behind their original 10k a week goal since the beginning and have since guided for less from Fremont and more from GF3.

All those additional things are equally needed for 3k more Ys or 3k more 3s. However, a new Y line would have robots and tooling whereas a 3 line would be more manual. Why put in an additional manual 3 line when they need the space soon for the Y line? Assuming they even have the equipment laying around.
I suppose they could make a manual line that can do 3s now and Ys later. In that case, we'll see a GA6 permit soon.

 

[KarenRei]

It's possible the timing makes sense for a temp 3 line, but I'm not seeing it. They've been behind their original 10k a week goal since the beginning and have since guided for less from Fremont and more from GF3.

Hey, let's say that they've given up on every single Model 3 that's to come out of GF3 at peak production (3k). So only 7k/wk at Fremont, not 10k. So 91k per quarter. Q2 produced 72,5k Model 3s. So, your point? They're still way behind production goals even if you subtract the entire capacity of GF3

All those additional things are equally needed for 3k more Ys or 3k more 3s.

No. Everything at Fremont and Giga was designed for a peak capacity of 10k Model 3s per week. They failed in a number of ways to reach their design production rates (particularly in terms of a highly automated assembly system, with conveyors delivering parts to robots that install all the bendy bits). But Fremont is still full of systems designed for 10k/wk Model 3s, operating at below design capacity.

Which is in a large part why unit production costs are still higher than we'd like, but have been dropping so much as they've been scaling up Model 3 production. When you plan on getting a certain number of cars out of a given amount of depreciating assets and a given amount of labour, but you get fewer than planned, your production costs are correspondingly higher. Scaling production rates has been probably the biggest driver towards Tesla cutting its production costs. If a new GA line - some more capital and labour - lets you build more cars without having to scale up everything else (because they're already scaled for higher production rates), that's a massive benefit.

However, a new Y line would have robots and tooling whereas a 3 line would be more manual.

Says who?

Model 3 and Model Y will be assembled in the same way - whatever way that may be. The whole point of them is that they're as similar as physically possible in all respects.

 

[Esme Es Mejor]

EV startup Rivian nets new $350M investment

Plymouth-based electric vehicle startup Rivian Automotive LLC announced Tuesday it netted a $350 million investment from Atlanta-based Cox Automotive as the automaker readies to produce its first vehicles.

The investment follows $500 million from Ford Motor Co., and $700 million from Amazon.com Inc. earlier this year. Rivian aims to launch its first electric pickup truck and electric SUV by 2021. The automaker is currently renovating an old Mitsubishi plant in central Illinois where it plans to start building those vehicles late next year.

I’d like to see Tesla doing this.

I think it’d be very beneficial to have Google, Apple, and Amazon buy small stakes (1-5%) in Tesla. I don’t think Tesla needs more money on the balance sheet, even in a recession, but it doesn’t hurt. And it sends an implicit to potential customers that Tesla is here for the long run.

I much prefer sending that message this way, rather than by paying for advertising.