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

[PaulRocket]

My thoughts on the new battery options:
As others have pointed out, I think this is only half the story. I think this will get them through Q1 and allow them to deliver roughly 20k S and X and focus more resources on scaling Model 3. However I do believe we will see a new 115-125 battery pack option in April. That would align perfectly with the reports that Panasonic will move cell production to North America in April and it would allow Tesla to differentiate the S and X even more before some German competitors enter the market.

 

[ReflexFunds]

Absolutely. Having the line down at night means they can retool. Either for improved margins, or - perhaps most interestingly - work to merge the S body onto the (more modern) X line, so they can retool the (very space-consuming) S line for the Y. No guarantees of course.

In the mean time, hey, more stamping and paint shop time for the Model 3

I wonder if the S body line might be retooled for Semi rather than 3 or Y. Semi is the vehicle next scheduled to enter production.
Semi production volume will also be much closer to S than 3 or Y and I can't imagine the old S equipment could be capable of the mass production needed for 3/Y.

I still think Y production is most likely at GF1 given the battery transport savings.and space and capacity limitations at Fremont.

 

[M3Rider]

Right. So same size.

C'mon people. I call that small.
S is medium, X is large. Few inches here or there is not a big deal.

 

[MP3Mike]

I suspect that there is also an offset in the cost of the warranty. As software limited range helps avoid excess stress on physical battery and it increases the chance that physical range will exceed 80% of original software limited range. Both of these make the warranty cost lower than the extended range.

What does 80% of original range have to do with anything? The Model S&X don't have any warranty for gradual capacity degradation. It could lose 1%/month and still not require a battery replacement under warranty. (At the end of the warranty it would only have 4% of it's capacity left or a range of 13 miles, and I'm sure Tesla would replace it before then, but they wouldn't have to under the current warranty.)

The Model 3 on the other hand is warrantied to retain at least 70% of it's capacity during the warranty period. (Which is not unlimited mileage.)

 

[Krugerrand]

Tesla launches new cheaper Model S and Model X with software-limited battery pack

LOL, hysterically!!!

 

[MarcusMaximus]

C'mon people. I call that small.
S is medium, X is large. Few inches here or there is not a big deal.

The larger Camry is 111.2” wheelbase, so the 3 is slightly larger than *that*.

 

[omarsultan]

However I do believe we will see a new 115-125 battery pack option in April.

I don't see this happening at least the specific calling out the pack size--it defeats the whole purpose of moving the the SR/LR nomenclature. They want to move the conversation to range which has two related advantages:
1) It is easier for mainstream buyers to relate to and to compare: The $88K SR Model X goes 270 miles while the $70K iPace goes 234 miles
2) It avoids them having to match the pack size of competitors for marketing purposes: "well the Audi has a bigger battery, so it must go further"

Tesla has a supply chain advantage over everyone else, so they can deliver on a given range much more profitably, or conversely, they can push the range and force competitors to either raise prices or eat margin to match them.

 

[Stretch2727]

I was just on the Tesla website looking at the Model S pricing and surprised how much they have paired back the options on Model S/X. I know they did this a while ago, just did not realize how few options. With this change even less hardware options.

2 Cars - Performance and Base
5 Colors
3 Wheels
3 Interiors (2 on performance.)

If you take out the wheels which are easily swapped, 25 cars (Model S) on the lot and you have every possible hardware combination. I am assuming ludicrous is just software. I don't think there are any car models that can hit this level of simplicity from a manufacturing/logistics perspective.

 

[ReflexFunds]

Somewhere in the $2.5k-$3.5k marginal cost range: if the cell level cost of 18,650 cells is $100 (optimistic scenario) then +25 kWh costs +$2.5k, if it's $140 (almost certainly a pessimistic estimate) then it's $3.5k.

The price increase is $9,000, which suggests a healthy margin improvement from this pricing change.

(Maybe @ReflexFunds has a better estimate how this might affect Q1 and Q2 sales and margins.)

Very difficult to know at this stage.

The new $85k base car will make c.$5.3k more profit than the 75D but c.$8k less than the 100D. The 100D is also now $1k cheaper. It will drive some 75D buyers to trade up but also many if not most 100D buyers to trade down. It is difficult to know how this balances out and also hard to know Tesla's new target production levels.

I will be happy with 70-75k, but disappointed with 50-60k annual S/X target.

 

[PaulRocket]

I don't see this happening at least the specific calling out the pack size--it defeats the whole purpose of moving the the SR/LR nomenclature. They want to move the conversation to range which has two related advantages:
1) It is easier for mainstream buyers to relate to and to compare: The $88K SR Model X goes 270 miles while the $70K iPace goes 234 miles
2) It avoids them having to match the pack size of competitors for marketing purposes: "well the Audi has a bigger battery, so it must go further"

Tesla has a supply chain advantage over everyone else, so they can deliver on a given range much more profitably, or conversely, they can push the range and force competitors to either raise prices or eat margin to match them.

Yeah of course it will be called Long Range or sth like that. The point is I still think they will introduce a battery pack with at least 400 mi of range.

 

[ReflexFunds]

I was just on the Tesla website looking at the Model S pricing and surprised how much they have paired back the options on Model S/X. I know they did this a while ago, just did not realize how few options. With this change even less hardware options.

2 Cars - Performance and Base
5 Colors
3 Wheels
3 Interiors (2 on performance.)

If you take out the wheels which are easily swapped, 25 cars (Model S) on the lot and you have every possible hardware combination. I am assuming ludicrous is just software. I don't think there are any car models that can hit this level of simplicity from a manufacturing/logistics perspective.

This is a good point, helps with manufacturing but also allows them to move to a local inventory model for S/X as they have for 3.

There are only 5-6k S/X Performance sales each year, so if these remain made to order, then you only need 15 S cars to cover all non Performance options combinations at the lot.

 

[Smokey4141]

I'll probably be banned (again) for this note, but, it needs to be said...
I keep reading note after note, all about "this" battery cell type, or that cell type, or about different battery capacities of the various Model S versions... And that's all fine...

But in several weeks, not one person has mentioned, or even considered, the absolutely ~stunning~ drop in US sales/deliveries, as of Jan 1st... As an investor, I'd think ~that~ would be the most note-worthy event of anything...
And not one word about it...

I'm sure I'll get plenty of down-votes, or "Funny!", but it's worth being concerned about...

All you have to do is poke around on Twitter a bit, and you'll see PLENTY of on-site visual reports - with pictures - of the growing number of full lots of Model 3's all around the country...
And those cars are just sitting....during Winter (below freezing, M3 battery-killing winter, I might add)...

You'll also see plenty of evidence of barely ~any~ sales, from reports of people observing various delivery centers...
If you live in the States, you can observe that yourselves... All you have to do is make an effort...

For those in other countries, please, take a few minutes to research this... It might be eye-opening for you...
I'm sure many will call all this "FUD", and you can call it whatever you want, but the pictures speak for themselves...
Just spend some time, and you might be surprised...

And even if you don't believe me......lets see just how much time Elon spends talking about Q1 sales on the call tomorrow...
I'm willing to bet he'll talk about anything BUT that.... We will find out soon enough...

I wish you all well, but as I said, this needed to be said... Good luck..

 

[MP3Mike]

I don't see this happening at least the specific calling out the pack size--it defeats the whole purpose of moving the the SR/LR nomenclature. They want to move the conversation to range which has two related advantages:
1) It is easier for mainstream buyers to relate to and to compare: The $88K SR Model X goes 270 miles while the $70K iPace goes 234 miles

However it also limits the ability to add range. You can't just decide to up the extended range version from 335 to 400, since then you would have to know the build date to know what you were getting. And how many names can they come up with?

Currently:

• Base
• Extended Range
• Performance

What would be next?

• Long Range? (nope that would conflict with the Model 3 since Model 3 LR = Model S Base. )
• Very long range? 400 miles?
• Extended Range performance? 350 miles? (That won't work)
  
• Ridiculously long range? 425 miles?
• Ludicrously long range? 450 miles?

They should have used the same description across models for similar range.

I think they have made a mess here, but I understand the reason for it.

 

[Krugerrand]

I'll probably be banned (again) for this note, but, it needs to be said...
I keep reading note after note, all about "this" battery cell type, or that cell type, or about different battery capacities of the various Model S versions... And that's all fine...

But in several weeks, not one person has mentioned, or even considered, the absolutely ~stunning~ drop in US sales/deliveries, as of Jan 1st... As an investor, I'd think ~that~ would be the most note-worthy event of anything...
And not one word about it...

I'm sure I'll get plenty of down-votes, or "Funny!", but it's worth being concerned about...

All you have to do is poke around on Twitter a bit, and you'll see PLENTY of on-site visual reports - with pictures - of the growing number of full lots of Model 3's all around the country...
And those cars are just sitting....during Winter (below freezing, M3 battery-killing winter, I might add)...

You'll also see plenty of evidence of barely ~any~ sales, from reports of people observing various delivery centers...
If you live in the States, you can observe that yourselves... All you have to do is make an effort...

For those in other countries, please, take a few minutes to research this... It might be eye-opening for you...
I'm sure many will call all this "FUD", and you can call it whatever you want, but the pictures speak for themselves...
Just spend some time, and you might be surprised...

And even if you don't believe me......lets see just how much time Elon spends talking about Q1 sales on the call tomorrow...
I'm willing to bet he'll talk about anything BUT that.... We will find out soon enough...

I wish you all well, but as I said, this needed to be said... Good luck..

Yep, super concerned. *yawn*

 

[Krugerrand]

However it also limits the ability to add range. You can't just decide to up the extended range version from 335 to 400, since then you would have to know the build date to know what you were getting. And how many names can they come up with?

Currently:

• Base
• Extended Range
• Performance

What would be next?

• Long Range? (nope that would conflict with the Model 3 since Model 3 LR = Model S Base. )
• Very long range? 400 miles?
• Extended Range performance? 350 miles? (That won't work)
  
• Ridiculously long range? 425 miles?
• Ludicrously long range? 450 miles?

They should have used the same description across models for similar range.

I think they have made a mess here, but I understand the reason for it.

Don’t be silly. You’d add proportional range to both and keep the names the same (as battery technology got better).

 

[mongo]

But in several weeks, not one every person has mentioned, or even considered, the absolutely ~stunning~ drop rise in non-US sales/deliveries shipments, as of Jan 1st...

FTFY

 

[M3Rider]

The larger Camry is 111.2” wheelbase, so the 3 is slightly larger than *that*.

Camry is 29mpg city, 41hwy, so there you go - 35mpg

 

[Zhelko Dimic]

Is this how the software limited 60kwh model s version worked previously? I was assuming that they could tap into the reserved capacity to compensate for natural degradation.

No, they don't. Why would they? That would make buying lower capacity no-brainer, and Tesla doesn't want that.

Further, this is probably just an intermediate step until higher capacity is ready, and lineup is re-jigged. This software limited version will be orphaned at some point, and owners will get an opportunity to upgrade at much lower cost.

Just like for my S60, price difference was $7500(CAD) to S75, and now I can upgrade for $2800 if I wanted to. I'd have done it if car wasn't leased. And will probably do, if I keep the car. If not, Tesla will likely sell it as S75, once it goes back to them...

 

[Reciprocity]

Exactly, also it's more clearly an upgrade to a Model 3 now: both range and acceleration increases in a clearly defined fashion as options are added:

                          | Range     | Speed   | 0-60     |  Price  |  upgrade cost
 -------------------------------------|------------------------------|--------------
 Model 3 Mid Range        | 265 miles | 125 mph | 5.6 secs |   $44k  |
 Model 3 Long Range AWD   | 310 miles | 145 mph | 4.5 secs |   $51k  | +16%
 Model 3 Performance      | 310 miles | 155 mph | 3.3 secs |   $62k  | +21%
 Model S                  | 310 miles | 155 mph | 4.1 secs |   $85k  | +37%
 Model S Extended Range   | 335 miles | 155 mph | 4.1 secs |   $93k  | +10%
 Model S Performance      | 315 miles | 155 mph | 3.0 secs |  $112k  | +20%
 Model S Ludicrous        | 315 miles | 155 mph | 2.4 secs |  $132k  | +18%

(I just updated this table from the U.S. configurator.)

What is interesting is that the new entry level Model S gains the 4.1 secs acceleration of the 100D. I.e. the software lock-down is only for the range, not for the drive train.

This suggests that the new Model S is basically the hardware of the 100D. This should position it pretty well against the Taycan.

Nice upgrade!

Also note that by making every battery pack 100 kWh they can now lower their annual production guidance to around 75,000-80,000 units.

Expect a Ludicrous Model 3 Performance to fit nicely in between the S and the Model 3P.

 

[MP3Mike]

There are only 5-6k Performance sales each year, so if these remain made to order, then you only need 15 S cars to cover all non Performance options combinations at the lot.

Really? Where do you get that low number from? About 41% of the Model Ss sold in Norway are Performance versions. (They have sold ~8k Performance Model Ss just in Norway in ~6 years. So almost 1k year just in Norway.) However it is only ~5% of the Model Xs.