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

[hobbes]

There was some speculation yesterday as to whether smart summon was going out to early access with V10 - this article confirms that:

Aside from “Tesla Theater,” the coolest new feature in V10 software has to be the Advanced Summon feature. I was able to watch it in action, but it didn’t seem appropriate or considerate to record the car using this feature while it’s still only available to Early Access Tesla owners. It’s wild, though, and I’ll be sure to create and share videos of my Model 3 using Enhanced Summon once it’s in wide release.

Tesla Autopilot & Lane Change Improvements in Tesla Software V10 — CleanTechnica Review | CleanTechnica

 

[riverFox]

Max Plaid proves otherwise.

I suspect Max Plaid was unveiled to inflict as much pain as possible for Porsche's profits than it was to help Tesla's in the short term.

 

[Remus]

So Porsche's problem: if they magically grow a much more capable EV platform (they won't), if they were beating Tesla with a 7:1x result they'd still be cannibalizing their own ICE offerings, which are still supposed to earn high margin profits in the next 3-4 years to make the Taycan investment break-even.

This^

 

[Stars aligned]

Elon tweets about bulls and explosion!

And the question is.... will it work this time?

(Low controversial Elon has worked well so far, the opposite not so much)

 

[CorneliusXX]

There is a difference between young celebrities who became rich overnight vs someone who earned their money over decades or a lifetime.

Rich businessmen who took 20 plus years to become very rich don't piss away their money lightly.

17 year old actors/rappers/professional athletes piss away money on cars every year.

Some are in between those extremes.

They're called coders

 

[Mad@gascar]

I can say with certainty that the visible side of the car was blue.

I can say with certainty that at Plaid speed, the Doppler effect will cause the Model S to appear blue while approaching, and red when receding from the observer.

 

[Stars aligned]

Will they really be releasing Plaid Model S right when Model Y is going into production?

Also, when and where is the Semi going to start production?

I still don't buy that the Y production only starts in late 2020. Many things hinting towards an earlier start.

One poster questioned whether it makes sense that Elon announces Plaid S so early because it could Osborne the current S. Some say it is not a problem because of the price difference. Another explanation is that if the Y production starts earlier, he will need every hand to produce the new model. And could take pre-orders for the new S generation. Also, many in the market for a more roomy car than the 3 will prefer the Y over the 3 or X.

And then once again, why GA5 and doubling the orders for Model 3 parts?

The plot thickens, imo.

 

[CorneliusXX]

No clue. But you could say the same about GF3 and it's clearly moving forward.
Having said that, I don't think cells from LG will be the US solution. I just think they have a solution we are not privy to. Lodger has some imaginative theories which might be bang on.

We'll know more in a couple of weeks with Q3 delivery numbers. That will give us the rate of GF1 capacity expansion.

We don't know the planned rate of model Y ramp. It may be stretched compared to the original model 3 planned ramp. Perhaps closer to the model 3 actual ramp, which should be quite leisurely and relatively stress-free the second time around. We have to remember that they share most parts.

We do know that there's an extra $4K free margin in every model Y - the additional perceived value of a CUV, a car Tesla can make for the same cost as a model 3. Tesla must be champing at the bit to get their hands on that "free money". Why wait?

I've been wondering about the timing effect of Tesla getting their internal cell production up and running for a while. To me this is probably the biggest risk they have with their ramp schedule.

There's little doubt in my mind they are going internal for cell production, however they could easily take longer than they are budgeting internally to have scale production running. There is a well documented history of new product scaling taking longer than expected (I.e. every vehicle they have made, solar roof, etc). They also don't appear to have a fallback position if cell production scaling takes longer than expected. We haven't heard of any new contracts with Pana to produce more cells (outside of optimising current lines) for Tesla at GF1.

If the ramp takes longer than expected it could have genuine impacts on the launch of new models.

My hope is that because LG, Samsung et al are also scaling cell production rapidly there will be available cells to cover any delay on Tesla cell production ramping.

The Macquarie research paper states that the LG plant reportedly producing cells for GF3 can churn out 150m cells per month which is good for 10k M3s per week. If that's just one plant then hopefully there is enough capacity globally to cover any delay.

 

[CorneliusXX]

I don't think the Porsche's Taycan's 2-motor EV technology is physically capable of Nürburgring 7:1x lap times: just two motors, just a ~93 kWh battery pack and a first generation EV technology.

(If they had such technologies they'd be able to post better than ~2.6 seconds 0-60 mph straight line performance - which they haven't.)

Porsche's 7:42 Taycan record was also carefully set so that their cash cow 4-door and 2-door ICE models would not be cannibalized by Taycan demand: the Panamera's best Nürburgring result is around 7:38, and most of the production 2-door 911's are in the 7:2x range.

So Porsche's problem: if they magically grow a much more capable EV platform (they won't), if they were beating Tesla with a 7:1x result they'd still be cannibalizing their own ICE offerings, which are still supposed to earn high margin profits in the next 3-4 years to make the Taycan investment break-even.

The Taycan is all about protecting Porsche's "racing car" niche and the halo effect, to keep customer jumping ship to Tesla. This image and their market leader position got seriously damaged today, and Elon's announcement that the Roadster 2 is expected to beat the 6:44 all time production car lap record on the Nürburgring will make everyone who truly wants to own the best racing car at minimum wait another year, before spending $200k-$300k on a Porsche that might be obsolete on arrival.

If Porsche are smart they will Osborne their ICE vehicles as quickly as possible while VW is still sloshing R&D euros around. It will be much harder to do so once sales start declining.

 

[Fact Checking]

And then once again, why GA5 and doubling the orders for Model 3 parts

I don't think there was any credible report about a "doubling" of Model 3 parts orders, was there?

GA5 is labeled as a "pilot" line in the permits. I believe Tesla wants to be certain in the GF3 ramp-up and won't complicate it with an overlapping Model Y ramp-up.

I'd be perfectly happy with Tesla meeting its self-imposed deadline of the first Model Y deliveries in late 2020.

 

[Fact Checking]

If Porsche are smart they will Osborne their ICE vehicles as quickly as possible while VW is still sloshing R&D euros around. It will be much harder to do so once sales start declining.

Making the feeling of any sort of "urgency" take hold within a huge, 50+ years old conglomerate and corporate bureaucracy of the 600,000+ employees VW Group is IMHO next to impossible while they are still raking in healthy gascar profits.

The arrogance within Porsche must be even higher, which typically scales with per unit EBIT.

Herbert Diess is just one EV guy, there's I believe a lot of detractors internally, and just one major mistake could cost him his job. He is trying to work a miracle IMO - we'll see whether he succeeds.

 

[Stars aligned]

I don't think there was any credible report about a "doubling" of Model 3 parts orders, was there?

GA5 is labeled as a "pilot" line in the permits. I believe Tesla wants to be certain in the GF3 ramp-up and won't complicate it with an overlapping Model Y ramp-up.

I'd be perfectly happy with Tesla meeting its self-imposed deadline of the first Model Y deliveries in late 2020.

I'm referring to https://electrek.co/2019/07/11/tesla-supplier-hints-massive-model-3-production-increase/ but don't really know how credible it is. Partially I agree with your believe and partially I don't. With the pilot line aimed to produce both models, they need to check if it really can, and test the models produced on the line. If everything works and supply chain is secured, why not start?

 

[Fact Checking]

I'm referring to https://electrek.co/2019/07/11/tesla-supplier-hints-massive-model-3-production-increase/ but don't really know how credible it is. Partially I agree with your believe and partially I don't. With the pilot line aimed to produce both models, they need to check if it really can, and test the models produced on the line. If everything works and supply chain is secured, why not start?

Yeah, so:

• Tesla has overlapping supply chains, and we don't know whether they simultaneously decreased orders to another relay supplier.
• GF1 output is probably still a constraint and I just don't see a 30% increase possible, let alone a doubling of output.
• I think Fred incorrectly connected the increase in Model 3 parts orders to production changes at Fremont: another factor are GF3 parts orders.
• Fred's speculation about Fremont increase and his failure to consider GF3 is doubly perplexing, because his own source is quoted as the new parts being intended for GF3:
  • "As Tesla is hiking Model 3 output and its Gigafactory 3 in Shanghai, eastern China, will kick off production of the electric vehicle by year-end 2019, CFTC’s shipments to Tesla are expected to rise, the sources noted."

Anyway, it's not impossible that there's capacity increase at Fremont, but "doubling" looks implausible to me, and while I'd love to be proven too bearish of a Tesla fan for a change, I wouldn't count on it, as I'm an incorrigible optimist. Not advice.

 

[Tslynk67]

I mean anyone that has seen the movie knows that the only thing faster than Ludicrous is Plaid. Did they really think Tesla would never develop Plaid? Don't they have SpaceBalls on German Hulu?

No Hulu in Europe and I don't see it on Netflix.

 

[Tslynk67]

Yeah, so:

• Tesla has overlapping supply chains, and we don't know whether they simultaneously decreased orders to another relay supplier.
• GF1 output is probably still a constraint and I just don't see a 30% increase possible, let alone a doubling of output.
• I think Fred incorrectly connected the increase in Model 3 parts orders to production changes at Fremont: another factor are GF3 parts orders.
• Fred's speculation about Fremont increase and his failure to consider GF3 is doubly perplexing, because his own source is quoted as the new parts being intended for GF3:
  • "As Tesla is hiking Model 3 output and its Gigafactory 3 in Shanghai, eastern China, will kick off production of the electric vehicle by year-end 2019, CFTC’s shipments to Tesla are expected to rise, the sources noted."

Anyway, it's not impossible that there's capacity increase at Fremont, but "doubling" looks implausible to me, and while I'd love to be proven too bearish of a Tesla fan for a change, I wouldn't count on it, as I'm an incorrigible optimist. Not advice.

Oh, thought you'd been given a time-out for naughty posts

 

[MC3OZ]

I still don't buy that the Y production only starts in late 2020. Many things hinting towards an earlier start.

One poster questioned whether it makes sense that Elon announces Plaid S so early because it could Osborne the current S. Some say it is not a problem because of the price difference. Another explanation is that if the Y production starts earlier, he will need every hand to produce the new model. And could take pre-orders for the new S generation. Also, many in the market for a more roomy car than the 3 will prefer the Y over the 3 or X.

And then once again, why GA5 and doubling the orders for Model 3 parts?

The plot thickens, imo.

The slightly complicating factor is Model Y may eat into Model X sales ... so a Plaid version of Model S/X around the time Model Y production starts is a good thing.

Once Model Y is being produced in volume some decline in Model S/X sales isn't the end of the world...

 

[lascavarian]

What is the plaid drive unit telling the other auto makers?

EM is letting this tech out of the bag to dissuade the auto gang from just making high end prestige units. There was a time this might have been a possible step.

With the plaid drive unit he is saying, “Don’t waste your money here. I won’t let you succeed.” There is also SpaceX tech awaiting those that don’t learn very quickly.

Additionally the plaid drive unit is troubling to those thinking of entering the light truck market. Tesla trucks are on the horizon and this drive unit will send some chills toward those thinking of competing in the truck market.

The real opening is on the low end. There are millions of potential customers on the low end that are unlikely to see a Tesla product in the near future. Low end market sales are the low hanging fruit.

If these automakers want to thrive then they will need to develop products for markets where they won’t have Tesla as a competitor for a few years.

 

[jeewee3000]

What is the plaid drive unit telling the other auto makers?

EM is letting this tech out of the bag to dissuade the auto gang from just making high end prestige units. There was a time this might have been a possible step.

With the plaid drive unit he is saying, “Don’t waste your money here. I won’t let you succeed.” There is also SpaceX tech awaiting those that don’t learn very quickly.

Additionally the plaid drive unit is troubling to those thinking of entering the light truck market. Tesla trucks are on the horizon and this drive unit will send some chills toward those thinking of competing in the truck market.

The real opening is on the low end. There are millions of potential customers on the low end that are unlikely to see a Tesla product in the near future. Low end market sales are the low hanging fruit.

If these automakers want to thrive then they will need to develop products for markets where they won’t have Tesla as a competitor for a few years.

I follow your reasoning but have to disagree: Elon is not trying to prevent other car companies from entering Tesla's markets. The reason of Tesla's existence is to force others to enter the market.

Competitors can't immediately enter the low end market (= low margin, high volume) since they lack the batteries. Entering the market means entering the high margin, low volume luxury market first.

So in my view Musk is saying: ICE's are obsolete, you HAVE to enter the BEV market as soon as possible....but Tesla will always stay ahead.

 

[MC3OZ]

What is the plaid drive unit telling the other auto makers?

IMO the message is if you want to compete with Tesla on EVs, you need to spend 100% of your R&D budget on EVs, and you need to think long and hard about your strategy.

Porsche did a good job with the Taycan.... but Tesla is raising the bar.... trying to make EVs a bit worse than the current ICE offering isn't going to cut it.

Once the Pickup, Semi, Roadster and Model Y are in production, the only significant market segments left untapped are:-

• Vans
• Compact low priced models.
• Mini-buses
• Buses
• Farm Machinery
• Earth Moving...
• Other specialist vehicles

I don't really see anything stopping Tesla eventually moving into these segments.

But Tesla can't make vehicles for 100% of the population, so make a good product at a good price, it will sell.

 

[CorneliusXX]

I follow your reasoning but have to disagree: Elon is not trying to prevent other car companies from entering Tesla's markets. The reason of Tesla's existence is to force others to enter the market.

Competitors can't immediately enter the low end market (= low margin, high volume) since they lack the batteries. Entering the market means entering the high margin, low volume luxury market first.

So in my view Musk is saying: ICE's are obsolete, you HAVE to enter the BEV market as soon as possible....but Tesla will always stay ahead.

High end is right. There are still plenty of people who want the old fashioned "luxury" interior that Tesla doesn't provide. A decent ev drivetrain with that sort of interior should sell well even if the performance is worse.