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

[sparcs]

Back in my day (err 3.5 years ago, lol), folks were going crazy to see the first release candidates of the Model 3.

Tesla Model 3: new blue release candidate spotted testing on the highway [Video] - Electrek

3 months before production started.

Meanwhile, in 2019, people do not seem that excited about Model Y RCs on the road, and are afraid to think that production is imminent.

Almost like you have all been traumatized by Model 3 production hell

We just add in an Elon Time Factor to everything now.

 

[StealthP3D]

Unfortunately, most of his followers are in the northern hemisphere, and it's not exactly tree-planting season anymore

Ha! I meant one dollar.

 

[TradingInvest]

BYD's earning is down 90%. The stock has dropped 50% in 20 months. BYD won't be able to compete with Tesla. I don't understand why it takes so long for some investors to understand this. Charlie Munger made a mistake in case of BYD. He should have taken a closer look after Tesla's IPO.

 

[Fact Checking]

It’s a pity it takes another two years before GF4 starts producing Model 3 and Y in Europe. With the lower pricing (no import tax, lower transport costs) they could have sold a lot more and earned more credits from FCA (and PSA).

I wonder if Tesla could adopt the following interim strategy in 2020 and 2021: use the FCA credits to substantially lower the price of Model 3 and Y in Europe, in order to sell more and earn even more credits (and so on).

Depends on the pooling contract - I hope Tesla gets a good share of the credit benefits.

If so then I'll believe they are going to reduce prices in the EU only if they think they still have to grow demand. Otherwise better to invest that cash into GF4 construction.

Limit to EU sales will be about ~50% of Fremont output IMO - which should be 60k/quarter. Still a long way to scale up to that magnitude.

 

[TradingInvest]

Amazingly, I agreed with 90% of the points Adam Jonas made. In this interview he certainly was showing an increasing amount of respect towards Tesla, and even defended Tesla against the negative narrative of the Bloomberg reporter.

The contrast he drew between Toyota (most valuable auto company with zero EVs) and Tesla (most shorted auto company with only EVs) was downright genial. I almost came to the conclusion that he cares about the EV transition.

A few mistakes he made IMO:

• He hyped fleet EV sales - while missing the immense rate of simple ICE replacement sales that are ~15 million vehicles per year in the US alone. Those are the primary target of EV market share expansion. Yes, more difficult - but also highly lucrative and the viral marketing is very valuable for zero-advertising Tesla, more so than for corporate fleet sales.
• He completely ignored the commercial EV truck business (Tesla Semi), which is both huge and high margin, and easier to disrupt because fleet sales are indeed the major expansion factor there, and it's the bottom line that matters. Regulatory limits against ICE trucks will also be imposed faster, once there are competitive EV trucks.
• He thinks Tesla's China margin improvements will be temporary: big mistake, China wants 100% EV sales by 2030-2035, and they just built a factory for Tesla in record time to accelerate that process, using their star state owned construction firm that they use for high profile construction projects. China: ~25 million vehicle sales per year, ~5 million of them in Tesla's price category ... addressable market: 10x of Tesla's current global production, and if China GDP grows 6-7% per year that expands car ASPs as well.

But nice interview overall, I can see the old Adam Jonas of 2015-2016 who was a Tesla super-bull, rising from the ashes again.

Exactly, that's why I never say "Jonas is an idiot", he knows what he is doing. But for some reason his mood swings a lot, which I assume it's money driven.

 

[ZeApelido]

Yes. HVDC (and to a lesser extent, HVAC). China does this large-scale already.

Highly efficient, and cheap per unit distance per unit power. Also allows sharing power between disjoint AC networks.

If only there was a company making long distance tunneling to make this more cost effective.

 

[Prunesquallor]

It’s a pity it takes another two years before GF4 starts producing Model 3 and Y in Europe. With the lower pricing (no import tax, lower transport costs) they could have sold a lot more and earned more credits from FCA (and PSA).

I wonder if Tesla could adopt the following interim strategy in 2020 and 2021: use the FCA credits to substantially lower the price of Model 3 and Y in Europe, in order to sell more and earn even more credits (and so on).

As I recall, the emissions limits REALLY get tough around 2024. That’s the time you want to be pumping out the ZEVs in the EU. GF4 needs to be BIG.

 

[StealthP3D]

99% of cabbies: wtf is this doors, how do I get in and out ? 98%: Love it anyways, gliding ride, glass roof, clean dash, acceleration, vents, navigation voice, play anything via slacker/spotify, karaoke, ...

When a passenger asks how to open the door, I actually tell them it's a mechanical aptitude test (I used to actually call it an intelligence test). I've found once you say that they figure it out real fast!

 

[Christine69420]

Shame we don't have regen on trailers (yet). The tow vehicle can absorb some of that kinetic energy but it's a pretty small portion. 10-20% maybe?

That's why we need the Tesla trailer! The pickup should be wired to accept regen from the trailer. But this is probably not until 2028.

I know you are talking semis - but the idea is live - caravans with regen for EVs:

Dethleffs e.home coco

In fact it's the opposite of a recall. Hey, we'd like you to bring your car in so we can replace a non-defective part that will significantly improve it's performance and resale value at absolutely no charge to you (except for your time).

Has that EVER happened before? What do we call it? An glee call?

Not a recall nor a retrofit. Perhaps an upfit?

As in

Tesla just upfitted my TMX with a better FSD computer.

 

[KarenRei]

TX to NY can't be done (without a lot of pain) because TX is on it's own incompatible system. To bridge there has to be a rather expensive connector built (there are two small connectors built IIRC from the presentation I attended).

This is incorrect. HVDC links incompatible AC networks. Indeed, there actually already are some tiny HVDC networks at the edges of the ERCOT zone, made solely for sharing power

 

[Carl Raymond]

Amazingly, I agreed with 90% of the points Adam Jonas made. In this interview he certainly was showing an increasing amount of respect towards Tesla, and even defended Tesla against the negative narrative of the Bloomberg reporter.

The contrast he drew between Toyota (most valuable auto company with zero EVs) and Tesla (most shorted auto company with only EVs) was downright genial. I almost came to the conclusion that he cares about the EV transition.

A few mistakes he made IMO:

• He hyped fleet EV sales - while missing the immense rate of simple ICE replacement sales that are ~15 million vehicles per year in the US alone. Those are the primary target of EV market share expansion. Yes, more difficult - but also highly lucrative and the viral marketing is very valuable for zero-advertising Tesla, more so than for corporate fleet sales.
• He completely ignored the commercial EV truck business (Tesla Semi), which is both huge and high margin, and easier to disrupt because fleet sales are indeed the major expansion factor there, and it's the bottom line that matters. Regulatory limits against ICE trucks will also be imposed faster, once there are competitive EV trucks.
• He thinks Tesla's China margin improvements will be temporary: big mistake, China wants 100% EV sales by 2030-2035, and they just built a factory for Tesla in record time to accelerate that process, using their star state owned construction firm that they use for high profile construction projects. China: ~25 million vehicle sales per year, ~5 million of them in Tesla's price category ... addressable market: 10x of Tesla's current global production, and if China GDP grows 6-7% per year that expands car ASPs as well.

But nice interview overall, I can see the old Adam Jonas of 2015-2016 who was a Tesla super-bull, rising from the ashes again.

He completely lost me with the conclusion that competition would come from tech giants. A car is now is a blend of three fields of expertise, automotive/mechanical engineering, batteries/electronics, software. The tech giants have only the last.

Apple tried it with project Titan. How’s that going for them?

They all seem to forget that Tesla has been iterating and scaling since 2003 to get to here. No way in hell anybody can catch them, even with unlimited cash. Growth rate is not simply a function of spend rate. You can’t bribe a tree to grow faster.

 

[KarenRei]

If only there was a company making long distance tunneling to make this more cost effective.

Thankfully, you don't need to tunnel for HVDC One thing that's nice about it is that it also works fine under saltwater (AC doesn't). Long-distance undersea cables are HVDC.

HVDC will play a key part in the renewable future.

 

[M3Rider]

HVDC could create a world-wide grid for renewables, such that the sun would never set on solar energy. Now the political borders aren't an issue that can be solved with technology.

I would assume that with batteries you can keep 2 day buffer, so worldwide grid is not necessary, but if you have a 3 day winter storm you may be in trouble locally and need energy from another state.

I think places like TX, AZ have much higher generation capability per panel, so even if you lose some in transmission, it could make more sense than adding these panels in another state, especially during winter when other states may lose a big chunk of production.

IDK if that actually makes sense to develop the grid for the entire U.S. based on power coming from these states and sorta create a monopoly in solar production or make it distributed, but then there may be no incentive for TX to only supply power during winter to other states and have their panels be a dead weight the rest of the year.

 

[Rarity]

They all seem to forget that Tesla has been iterating and scaling since 2003 to get to here. No way in hell anybody can catch them, even with unlimited cash. Growth rate is not simply a function of spend rate. You can’t bribe a tree to grow faster.

It could be argued that it is because of unlimited cash. Wiser heads than me have pointed out that almost all of these tech companies have higher margins in their core business than is the current auto business. They lack fortitude when fighting in lower margin businesses. Case-in-point: Apple.

The notable exception is Amazon, which competes well in one of its two core businesses at exceptionally low margins. Amazon lacks design sense, but they probably could be competitive in the auto space.

 

[Prunesquallor]

Yes. HVDC (and to a lesser extent, HVAC). China does this large-scale already.

Size comparison map:

Highly efficient, and cheap per unit distance per unit power. Also allows sharing power between disjoint AC networks.

CREZ is the 3500 mi transmission buildout Texas completed about 4 years ago to get the Panhandle and Trans-Pecos wind power to DFW, Austin, San Antonio and Houston. It’s what allows negative pricing at night and (hopefully) will enable a West Texas solar buildout.

Edit: Mostly HVAC as I recall.

 

[TradingInvest]

I could be wrong, but I think Tesla + SpaceX will reach escape velocity in the next few quarters. SpaceX will start to offer internet service, which could triple the market cap. Tesla is on track to achieve much higher revenue with higher gross margins.

 

[DrMazeppa]

OK, I am gonna post it here (Top Gear: Taycan versus model S - not plaid though)...

 

[jerry33]

This is incorrect. HVDC links incompatible AC networks. Indeed, there actually already are some tiny HVDC networks at the edges of the ERCOT zone, made solely for sharing power

That's what I said. They are tiny. For a significant amount of power to be transferred they would have to be quite large.

 

[KarenRei]

OK, I am gonna post it here (Top Gear: Taycan versus model S - not plaid though)...

Been widely discussed elsewhere. A 11,08s quarter mile is nonsense for a Model S Raven Ludicrous; they normally get in the 10,5x seconds range. 0-60 time is nearly 0,3s slower than spec.

They also claim that the top speed is 155mph. The *old* Model S had a new 155mph, but the new ones have a 163mph top speed. Which makes me suspect that they had an old one. Not that that alone would explain their terrible performance.

Also, re: handling: if they're in an old S, then they don't have the new active suspension.

I wish there was an easy way to tell Raven from non-Raven apart from the badging. You never get a good look at the rear badging in their video, unfortunately.

 

[dc_h]

There's no Paint Shop at Lathrop. There's no huge multi-ton Stamping Press. It's a 33 mile trip to the seat factory. Model Y can not be built there without a huge increase in logistics.

Better to fantasize about Semi production there I think. Plastic aero body means no stamping and painting? Closer to Sparks/GF1 for motors, btys and electronics.

Cheers!

Semi and Roadster could be built there, at least to start. Roadster volume will be low enough that shipping costs will not matter very much.

I hope we see some signs of more semi's rolling out to run pilots with the early customers. A UPS Tesla would be a feel good moment. UPS will be excited too, there's a lot of Amazon trucks on the highway these days. They need to cut costs and get better faster.