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

[jerry33]

Going over Model 3 overview again, nothing interesting. Going back into the ceremony now

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Last employee taking delivery is proposing to his GF. (Both were studying in the US)

After I had read this far I wondered why the employee was proposing to the Gigafactory. Girlfriend was not the first thing I though of when seeing GF.

 

[mzairboy]

View attachment 494314

Is Elon wearing a Cybertruck Shirt? Soon to be released merch?

 

[NicoV]

Tesla delivered 685 cars in the Netherlands yesterday. Yes, that would be on a Sunday.

NL now has 16K registrations for Q4, more than doubling the previous record of Q3. The total for NL/NO/SP is 18K, showing clearly what kind of monster delivery rush we’re seeing in NL.

On the FB Benelux groups you see messages from people who get SMS’es with delivery appointments for the wrong persons with a day notice, sometimes people that have driven away with the wrong car (VIN), people picking up their cars finding that it’s the wrong config.
Someone was seeking people to join a lawsuit against Tesla for not being able to provide a promised SR+, claiming that Tesla should pay for the extra BIK (the consensus seems to be that Tesla can’t be held liable for this). Other people that couldn’t get their SR+ anymore seem to have taken delivery of an LR instead.
The rumour is that whatever is not delivered by tomorrow evening will go to a lease company, they will have no trouble finding lease takers for those cars.
Well done Tesla!

 

[Boomer19]

Psychologically you are correct but now you can buy factional shares: Fractional Shares | Robinhood

you can buy frac shares at interactive brokers too

 

[gerebgraus]

According to the media who was at GF3 delivery event, production rate is 28/hour for 10 hours a day for 5 days a week and 1 day for training.
Early next year will start with two shifts.

Currently MIC Model 3 is 30% locally sourced. Targeting 70% by mid year and 100% by EoY.

The way I have understand there was a single day when they reached 280, and a single week where they reached 1000. Some people took that as current production rate is 280x 7 = 1960 i.e. 2k/week steady state. That is wishful thinking. We are talking about burst rates and not stready states.

 

[madodel]

Checking the NASDAQ hours, market is closed Wednesday, January 1 of course but no mention of Tuesday, December 31st. I assume it is a full day since the page does say market may close early on days before July 4th, Thanksgiving and Christmas. Anyone know for sure? What Time Does The Stock Market Open And Close?

 

[Doit]

Checking the NASDAQ hours, market is closed Wednesday, January 1 of course but no mention of Tuesday, December 31st. I assume it is a full day since the page does say market may close early on days before July 4th, Thanksgiving and Christmas. Anyone know for sure? What Time Does The Stock Market Open And Close?

NYSE: Holidays and Trading Hours
regular market hours for 12/31/2019

 

[gerebgraus]

Panasonic ramping Gigafactory up to 54GWh



To build its team, Panasonic recruited chemical engineers from non-battery sectors and trained them to handle lithium-ion batteries. Now it has 3,000 people who operate the machinery and about 200 technical assistants from Japan to keep the plant running 24 hours a day, 365 days a year. “For us to move to [54GWh] should not be so hard. We now have the knowhow to do it in quite a high volume environment,” said Mr Swan. Securing engineers is a critical step as Tesla plans to use batteries produced at the US gigafactory for its Model Y sport utility vehicle when it launches next summer, according to people with knowledge of the plan.

The first sentence of the article: "Panasonic says it has resolved a labour shortage that has hampered production efficiency at the “gigafactory” in Nevada, its joint-venture electric battery plant with Tesla." Calling it a joint venture is a huge mistake. So I would take everything in the article with a grain of salt. It is remarkable that prestigious media produces so much BS about Tesla.

 

[Artful Dodger]

Checking the NASDAQ hours, market is closed Wednesday, January 1 of course but no mention of Tuesday, December 31st. I assume it is a full day since the page does say market may close early on days before July 4th, Thanksgiving and Christmas. Anyone know for sure? What Time Does The Stock Market Open And Close?

Yes, its a full trading day on Dec 31, 2019:

Trading Calendar

NYSE: Holidays and Trading Hours
regular market hours for 12/31/2019

TSLA trades on NASDAQ, not the NYSE.

 

[jerry33]

TSLA trades on NASDAQ, not the NYSE.

Have they ever had different trading hours? (Not being snarky, just wondering).

 

[Mike Smith]

Tesla to miss delivery forecast and stock to get cut in half, Cowen says

This is pretty embarrassing for Cowen. I predict they'll silently end coverage soon just like Goldman and UBS did.

 

[HG Wells]

Oh, and Tesla making big move in premarket !
Stocks making the biggest moves premarket: Tesla, Disney, AstraZeneca & more

We are basically bouncing around neutral.

 

[ReflexFunds]

This is not scientific. There are a lot of studies on the topic of S&P inclusion.

This is the list of articles which I skimmed in my last hour reading about it.

https://www.tandfonline.com/doi/abs/10.2469/faj.v64.n5.7?journalCode=ufaj20

http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.192.7439&rep=rep1&type=pdf

https://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr484.pdf

What Drives the S&P 500 Inclusion Effect? An Analytical Survey on JSTOR

https://www.nber.org/digest/nov13/w19290.html

What Drives the S&P 500 Inclusion Effect? An Analytical Survey | Semantic Scholar

They cover ideas of increased arbitrage and volatility. Correlation vs causation of the inclusion effect. How much of the inclusion effect would have happen anyway because the company was going well enough to get included. How much is due to increased awareness of the company? The historical SP inclusion effect (which from my reading is about 5%). Whether the effect is permanent or not.

I am in the Valley of Despair on the Dunning Kruger Effect on this topic. Of course no-one knows how it is going to affect TSLA but personally I am putting a lot more value to the research on this topic, and less on what happened with the Saudi PIF, which I think had a lot of other factors at play. Also I am not sure the effect is permanent as per the research. Also I would call <5% insignificant, in a non-mathematical sense of the word.

So personally I am expecting anywhere from 0-10% bump with a likely 5% bump. Outside this range I will be surprised.

Feel free to reply with your reasoned out estimate... we will know soon enough the actual figure for TSLA and see who is closer then, although even then it is hard to tease out the effect from S&P inclusion from the sustained profits which got them included in the first place.

Thanks for sharing these links. It’s always worth reading the literature and I agree there is no way of knowing for certain how S&P 500 addition will impact the stock price, but it is possible to form a much more Tesla specific view than these generic studies. There are a number of omissions in all these studies and also reasons why these are not directly applicable to the situation at Tesla

Here I’d first recommend reading my recent post about what share prices actually are and how they work price because it will make it easier to understand the following explanation for the impact of S&P 500 addition to Tesla share price.

Given it’s a Sunday and Tesla share price is at new highs, I thought it worth elaborating on my prior post and explaining more about my views of what a share price actually is and what needs to happen to drive a share price on to a new level.

I generally find theory, papers and studies in finance are of a far lower quality than those I read in Science or Machine Learning. Nearly always I can almost immediately find absurd assumptions or failure to account for or isolate key variables which make most of the conclusions largely meaningless. In particular I find many of these papers start with the ridiculous assumption that the efficient market hypothesis is correct and this leads them to make big mistakes when setting up their analysis.

Even outside of the financial academic community and their efficient market dream world, I find very few people actually working in financial markets ever take a moment to think from first principles what is actually happening and what terms in finance actually mean.

For example many Short Investors and market makers seem to have never considered what shorting actually is. In my previous post I talked about this process and described Shorts creating new synthetic shares when they short a stock, but that is a term I made up because I don’t even know if finance has a word for it.

Similarly, few people in finance seem to have actually thought about what a Share Price actually is. And I can’t even find a reasonable answer for it when googling.

Wikipedia’s first sentence includes the obviously false: “In layman's terms, the stock price is the highest amount someone is willing to pay for the stock, or the lowest amount that it can be bought for.” Yes it is the lowest amount it can currently be bought for, but it is not the highest amount someone would be willing to pay.
Investopedia tells you: “Most people believe a stock's value is determined by its price. That's only true to a certain extent. But there is a real big difference between the two. The stock's price only tells you a company's current value or its market value.” Yes this is true, but it is not a functionally useful definition when considering what will actually drive changes in the price.​

A company’s stock price is not the true value of a company’s equity. Nobody knows the true value of a company’s equity, not an individual investor, not company management and not the market as a whole. A company’s true value is the discounted value of its real future cash flows. We can make educated guesses what these future cash flows will be, but we cannot know for certain, and hence it is impossible to know a company’s true value.

On my definition, a share price is:
The equilibrium point where the available capital owned by Active Investors with a company valuation estimate greater than the current share price is equal to the number of shares (plus synthetic shares) available for active investors to purchase.

Hence a share price is changed by 3 key things:

• Changes in fair value estimates of individual investors that are currently invested in or valuing the company. These valuation estimates/share price targets do not have to be rational, analytical or even conscious. This could be investors that think that a stock is currently undervalued based on gut feel, it could be people that bought because they see upcoming positive catalysts which they think will increase the price (such as S&P 500 inclusion or M&A), it could be people buying based on signals from technical analysis. For people that do build a firm valuation model, there is still huge disagreement on which valuation methodologies to use and which fundamental assumptions to make about future cash flow. Some investors may make all their investment decisions based on multiples of historic financials. Some may make a single base case model and perform a discounted cash flow analysis. Some may make many or even hundreds of different models for future results and take a probability weighted average valuation. These valuations or gut feels will mostly be changed by changes to a company’s fundamentals, technicals or upcoming catalysts. Often there is a strong correlation between an investor's valuation and the actual stock price. For example at any moment the investor may always think the stock should be worth 30% more, and as the stock goes up they subtly tweak their models to justify this higher valuation. This is because emotion and gut feel is a far larger driver of investment decisions than investors like to admit (even to themselves).
• Increased or decreased pool of capital considering the stock & making fair value estimates. The pool of investors may increase because people simply had not heard about the stock before. It could increase because some investors had previously dismissed the stock based off a media narrative or equity analyst reports without ever forming their own valuation opinion, but when the narrative changed they decided to do some work. It could increase because investors had previously been unable to invest based on fund mandate requirements such as only profitable companies or only companies in the S&P or only dividend paying companies etc, and one of these factors now changed. The pool of investors may decrease because a fund decided to cut all exposure to a particular sector, or because the stock was too volatile and they decided it wasn’t worth the stress etc. Note that each individual investor only has a certain amount of their wealth or fund available to invest in a particular stock. So the pool of capital considering a particular stock is also constrained by position or risk limits, but these could also change up and down, particularly if a stock starts to be considered less risky.
• Changes to number of shares available for active investors to purchase.This can change due to share buybacks, changes in short interest, share issuance, purchases by passive index funds (which reduce the share pool available for active investors to use for their valuation based investments), share lock up expiry, changes in shares held by Options or Convert Delta Hedging etc. A reduction in these shares reduces the pool of shares that active investors are competing to buy and hence lowers the threshold of investor capital needed for the company to reach a particular share price.

To illustrate this with regards to Tesla.

• There is a certain pool of available capital available (for a single stock) controlled by Active Investors who have considered a Tesla investment and have formed their own view of valuation. Perhaps this is $150bn, perhaps $200bn, we don’t know. But each of these investors will have a view on whether Tesla is under or over-valued based off a financial model, technicals or gut feel etc.
• Currently there are 206m Tesla shares available for longs to buy – 180m real shares and 26m synthetic shares created by shorts. In reality Elon’s 34m shares are not available for active investors to purchase, so this leaves just 172m shares worth ~$69bn. Again, some of these shares are already held by passive funds tracking an index such as Russell, Nasdaq or MSCI, perhaps this is 10m shares, so again these are not available for Active investors to purchase. This leaves $65bn of Tesla long exposure available for Active investors to purchase.
• Of the say $200bn available capital controlled by Active Investors who have considered a Tesla investment, $65bn need to think Tesla is undervalued for us to achieve the current share price. Within the $200bn of potentially Tesla friendly capital there will be a wide distribution of views on valuation. $135bn thinks Tesla is worth less than $400 so would only invest if the share price fell below this level. Maybe $25bn thinks it is worth more than $600 so would only begin to sell if the share price rises above $600. $40bn have valuations between $400-600 and each would sell when share price rises above their valuation (unless they have changed their view on valuation in the meantime). These numbers are not estimates by the way, they are completely made up just for illustration.

So from here share price can change for 3 reasons:

• Change to the valuations made by this current $200bn pool of capital. This could be due to company specific or market wide reasons. For simplicity, if some event caused every single investor to increase their valuation by the same amount, say $50, then investors that were previously uninvested because they thought Tesla was worth $350-400, now think Tesla is undervalued (with valuations now ranging from $400-450. So these investors will now buy shares until a new equilibrium price is found. What exact price this moves to will depend on the distribution of different investor’s value estimates, but it will not likely be as high as $450.
• New investors considering a Tesla investment and adding to the $200bn pool of capital. This will change the whole distribution of valuations and will change the equilibrium point where the value of available Tesla shares is equal to the amount of capital valuing the company above the current share price. So this can change the share price even if no individual ever changed their Tesla valuation.
• Changes to the pool of shares available for active investors to purchase. For example since May the number of synthetic shares created by shorts has reduced by around 17 million. This has reduced the pool of shares available for active investors to purchase, and hence reduced the amount of Active investor capital needed to reach a particular share price. Similarly, if 20 million shares get bought by passive S&P 500 trackers, these shares will be removed from the pool of shares available for Active investors to compete over. These passive funds effectively have an infinite price target on Tesla because nothing will cause them to sell aside from changes in the size of their funds. So these things can permanently change the share price even if no investor changed their valuation and even if no new investor started considering an investment.

Just as a note. Instead, on the efficient market definition, which forms the foundation for much of financial theory and models, a share price is:
The true value of the company given all available information (presumably where the market has magically arrived at the correct answer because it is an infallible and emotion free superintelligence).

Hence a share price is changed by 1 thing: New information which changes the fundamental value of the company and is immediately perfectly reflected in the share price.
So on this definition a share price cannot be impacted by supply and demand. The change in available shares driven by changes in short interest, share buybacks, purchases by index funds, new investors, share lock up expiry etc cannot change the share price.

So back to S&P 500 membership

The main problems with these studies on share price impact of S&P 500 addition are:

• These studies are on share price changes after the official S&P announcement and during later months and so misses share price changes driven by anticipation of the announcement. So these studies do not take account of the fact that many investors will anticipate S&P addition (particularly if it is driven by meeting the profit criteria) and this will have increased their valuations or gut feel conviction (or brought in new short term traders betting on a S&P bump). So share price will be boosted ahead of an S&P addition, not only after the official announcement and it is not only driven directly by passive fund buying.
• There is a huge difference between companies being promoted from the S&P400 to the S&P 500 vs companies going straight into the S&P 500 index and this is not accounted for in these studies. S&P 400 is broadly the 500-900 largest profitable US companies with liquid equity. Many passive funds already own S&P 400 companies and transition to S&P 400 to 500 is mostly just transferring shares between funds so you shouldn't expect a large share price change. These are by far the most common transitions and they are most often due to meeting market cap thresholds or S&P500 exits due to M&A (and I think for these S&P500 addition is relatively hard to predict in advance). However, If a company moves straight into the S&P500 from outside the S&P universe (most likely because it has now met the S&P profitability criteria), this forces far higher incremental buying from passive funds and a far higher change in the share price. This study shows the importance of prior S&P400 membership but the study still has many shortcomings - http://janschnitzler.com/wp-content/uploads/2016/12/sp500.pdf
• Nearly all of these S&P 500 studies use pre-crisis data which is over 10 years old. This is a very significant flaw given close to doubling of the % of US stocks held by passive investing and index tracking funds during these 10-12 years. This clearly increases share price leverage to index additions. This is partially offset by increased market liquidity due to reduced transaction costs the past 10 years.
• The more difficult a company is to value and the more divergent the investment narratives, then the larger distribution of share price valuations (whether explicit or sub-consciousness gut-feel) within the current investor base. This makes a stock price much more sensitive to changes in supply and demand of shares. If 90% of investors have a valuation within +-10% of the current share price, then changes in shares available to active investors will not cause a dramatic change in share price. However if only 5% investors have a valuation within +-10% of the current share price, it is very easy for changes in availability of shares (in this case due to shares locked up by passive investors) to cause significant changes in the share price.

So all of these factors point to S&P 500 membership being far more significant to Tesla share price than the market averages measured by these studies: 1) Passive Investors now own a far higher % of US market caps, 2) Tesla will be promoted from outside the current S&P index universe, 3) Tesla is very hard to value and investors have a very wide range of valuations and 4) Tesla will see a significant run up in share price ahead of official S&P announcement because profitability driven S&P 500 additions are easier to predict than market cap based ones. This S&P share price bump is likely already happening to some extent, and if Tesla does enter the S&P 500 after Q120 or Q220 it will be sustained, and if it does not and Tesla no longer looks likely to meet last twelve months profitability in the near future, then this S&P bump is likely to reverse.

But how many new shares will actually be bought (and effectively taken out of circulation) by passive investors?

It is important to note Tesla shares are already held by many passive funds. In particular indexes which do not have a profitability criteria such as Russell, MSCI or Nasdaq indices. However S&P indices have the largest market share of passive investment for US companies.

The S&P 500 is market cap weighted and float adjusted, so in Tesla’s case Elon’s 34 million shares and the ~29 million synthetic shares created by shorts are excluded from share count. This means at current share price Tesla would be rated at a $64.5bn market cap, even though in reality investors and Elon are long $91.6bn Tesla equity equivalent.

The market cap of all S&P 500 companies is currently $28.7 trillion. The total market cap of all US equities is currently $36.1 trillion (the closest index to tracking all of this is the Russell 3000 which covers 98% of this market cap). This means Tesla would take 0.22% of all investment in S&P 500 passive tracker funds.

Passive investment consists of passive ETFs, passive Index Mutual Funds and passive Index Institutional funds. It is amazing how difficult it is to find good estimates on how much equity is held by passive funds, and how much of this is tracking the S&P vs Russell vs MSCI vs Others etc. The most detailed information I can find is in The Economist - According to its estimates these passive funds together held 29.8% of the market cap of the entire US listed equity universe, or ~$10.7 trillion at current levels.

What % of this $10.7trn is tracking the S&P 500, I don’t know.
When Twitter was added to the S&P 500 one investor estimated 78 million shares would be bought by passive funds following S&P inclusion, or 10-11% of the free float. Twitter shares jump 5 percent as they win new follower: The S&P 500 If this is accurate it would mean ~$3.6trillion is held directly by S&P passive funds and ~15.5-16 million Tesla shares would be bought by passive S&P funds when Tesla is added to the index.

Another way to look at it is to look at ETF ownership of Tesla relative to S&P companies as a proxy for the broader passive investment market. Looking at some high profile S&P companies – these are the % of outstanding shares held by ETFs: Apple 6.2%, Netflix 6.2%, Google 5.0%, Amazon 5.2%, Nvidia 7.0%, GM 6.2%, Twitter 8.5%. This compares to Tesla at 3.2% currently. I would guess the variation between ETF ownership % in these various S&P companies is driven by inclusion in thematic or sector specific ETFs. Maybe it would make sense that Tesla would land somewhere between GM and Nvidia once it is in the S&P 500, or more than double the current ETF ownership. If this trend in ETF inclusion is a good proxy for Index institutional and Mutual Funds, then passive ownership in Tesla could double upon S&P 500 inclusion.

Overall I’d guess around 15-20 million additional Tesla shares will be bought by passive funds when Tesla is added to the S&P 500. If 20-25 million Tesla shares are already owned by passive Russell, Nasdaq or MSCI funds, then 35-45 million Tesla shares could be out of circulation due to passive fund ownership.

However, this is not the full picture…

Even within the Active Investor universe, fund performance is generally benchmarked to an equity index to track the fund’s performance relative to the market.

When an investor is benchmarked to an index, every variation between their own stock positions and the overall index is an active investment decision. Often it is easiest to mostly hold the same shares as the index, but to overweight or underweight certain shares that you think will give you an edge vs passive investment. So when a new company is added to the S&P, over time funds benchmarked to the S&P will look at that company to decide how they should be positioned in that company relative to the market cap weighted index.

Most US equity investors have so far avoided looking at Tesla, partly because it is complicated and takes a lot of work, partly because they have immediately dismissed it based off the media and equity auto analyst narrative. However many will be forced to start looking at Tesla because if they are benchmarked to the S&P then not owning Tesla will become an active investment decision. Many of these new potential investors will look at research from the Equity Auto analysts and uncritically buy into Tesla is just another ICE Auto company narrative, however many will have experience investing in tech companies and will see the fallacy of allowing a group of analysts with narrow expertise valuing mature, conservative and anti-innovation ICE companies to value a rapidly growing innovation machine.

I can’t see a current estimate, but this article says that in 2016 $2.9 trillion was invested in S&P 500 passive funds while another $5.7 trillion was benchmarked to the S&P 500. S&P 500 evolves to reflect makeup of the economy - InvestmentNews So these active benchmarked investor’s capital is potentially twice as large as the passive investment capital.

So over time I’d expect S&P 500 membership to bring far more than just the 15-20 million direct forced passive fund Tesla share purchases. S&P 500 membership is a huge, huge catalyst for bringing new active shareholders on board and increasing the pool of active investment capital valuing or making gut feel investment decisions on Tesla stock.

The stockmarket is now run by computers, algorithms and passive managers

What will S&P 500 membership do for share volatility and beta?

It may be counterintuitive, but S&P 500 membership will actually increase volatility and increase beta. With more shares locked away by passive investors, it takes less to move the share price.

When the market is strong, passive funds will likely be buying which will tie Tesla stock price closer to the market direction (so increasing beta). But because Tesla is far harder to value than most companies, there is far less consensus on the correct valuation and a far broader range of valuation estimates relative to most stocks in the market. This means it takes less share purchases to move the stock price and beta will be higher than the market (so above 1) on days where there is no company specific news. Overall measured stock price beta will be lower than this because there is still going to be a lot more company specific news and catalysts (relative to most shares in the market) which can sometimes move Tesla in opposite directions to the market on days when this information is released.

Its also worth noting that S&P 500 membership provides yet another reinforcing feedback loop to stock price changes (in addition to the options delta hedging and short collateral calls I’ve discussed before). Because S&P 500 is market cap weighted, an increasing market cap (relative to the index) will mean S&P passive funds have to increase their shareholding in line with Tesla’s increased share of the index. This share buying will drive the share price higher which in turn drives more share buying to keep the market cap weighting. Much of this will be reflected automatically by the increased value of the existing shareholding, and the true effect of this feedback will depend on things such as stock issuance, share buybacks of other companies and rebalancing procedures etc.

What about debt and bond ratings?

I think @jbcarioca mentioned a few weeks ago how debt ratings are also very significant. This is not connected to S&P stock inclusion, but bond upgrades are indeed going to be additional key positive milestones for the company, particularly when it reaches investment grade. I don't think its common for equity funds to be tied to debt ratings or investment grade, but it is very common for debt funds to be tied to specific ratings by their mandates and this can drive a powerful technical which reduces cost of funding as a company gets upgraded.

At Moodys Tesla as a whole is rated at B3 but its bonds are rated one notch lower at Caa1 because the bonds are subordinated to bank debt. These bonds would require 7 upgrades to get investment grade (or 21 upgrades if you include negative, neutral and positive outlooks for each level as separate rating levels). S&P rates both Tesla and its bonds at B- positive. So the bonds are already one level higher than Moodys but still 6 notches from investment grade (or 17 levels including outlooks).

So it still looks a long way away from investment grade, but every upgrade can reduce Tesla's cost of debt and multi level upgrades can happen very quickly if Tesla delivers a step change in profitability and EBITDA.

In July total outstanding debt of large US companies was $10 trillion while total corporate debt (including small medium sized enterprises, family businesses, & other non listed companies) was $15.5 trillion. Of this ~2/3rd was Investment Grade. U.S. Corporate Debt Continues To Rise As Do Problem Leveraged Loans

So there is huge potential for Tesla to increase its debt as it increases its profits and increases its market cap. It can use this debt to fund accelerated capex, to fund acquisitions or to fund building its portfolio of solar and car lease assets. This is in contrast to most US companies that mostly issue debt to fund unproductive share buybacks, dividends or acquisitions rather than organic growth. So as Tesla increases its rating it will become more and more attractive to issue debt to accelerate capex and accelerate expansion and build out of a global renewable energy grid and electric car fleet.

 

[printf42]

Thanks for the link, the event is concluding.
A few notes:

• Live proposal!!! The girl said yes!!!
  
• 15 employees today are only representatives, more employees will get delivery in the following two days.
• Customer cars will start being delivered in Jan
• Tesla China operation will be “several times bigger in next year, exactly how many times can not be discussed yet”
• Double Chinese service centers in 2020
• Double Chinese superchargers in 2020
• Thankful for supports from central and local governments, without those it would not be possible to break ground and deliver cars in the same year!!!

Went back and watched replay again, one correction to my notes:
Tesla China operation achieved “several times increase in 2019, exactly how many times can not be disclosed yet”, in 2020 the momentum will continue.
He was not exactly talking about 2020.

I can not edit my post anymore, could any mod help correct it?

 

[thx1139]

Will China starting delivery just 2 days before end of year help or hurt Tesla financials. I am leaning towards hurt. It seemed like they were producing cars all months and just started delivery today. Unless they can really deliver all those units built before end of year those will all be a drag on profit. I dont believe they were being counted on pushing the production number to the estimate, so anything produced is gravy towards the 360K minimum they said at beginning of they year.

 

[mongo]

No currently produced Tesla can park easily in any major Japanese city because none will fit in the car parking equipment, among other things.

Not so, Tesla sized the 3 to fit.

It should be noted that the Model 3 will be the first Tesla that will be compatible with Japan’s multistory automatic parking machines, as the Model S and Model X were usually too large for the facilities. With this, the Model 3 would likely be an attractive vehicle even for customers who live in an area where on-street parking is incredibly scarce.

Tesla showcases why the Model 3 is perfect for small parking spaces

 

[jerry33]

Not so, Tesla sized the 3 to fit.

Tesla showcases why the Model 3 is perfect for small parking spaces

The perception is otherwise because it's larger than the standard small car in Japan.

 

[Cattledog]

Late entry for post of the year. Thx, ReflexFunds.

So back to S&P 500 membership

But how many new shares will actually be bought (and effectively taken out of circulation) by passive investors?

Even within the Active Investor universe, fund performance is generally benchmarked to an equity index to track the fund’s performance relative to the market.

What will S&P 500 membership do for share volatility and beta?

What about debt and bond ratings?

 

[Words of HABIT]

I've never read so many positive things about Victorville.

Am I reading this correctly? By 2029 Volkswagen is still planning no producing over 50% of its vehicles with conventional ICE (gas and diesel)? As a consumer, we have limited BEV offerings today, so I understand the need for ICE, but surely in 2029, why would anyone want to drive dirty ICE when BEVs will be mainstream? The sooner Volkswagen realizes that BEV production is an S curve and not a straight line the better.

 

[lklundin]

Today's MIC Model 3 deliveries from GF3 is covered also by the Guardian:

Tesla delivers first China-made cars from $5bn Shanghai factory

Unlike some previous Guardian articles this one is not openly hostile to Tesla (and does not mention Elon Musk),
but it does leave out some significant positive news, e.g. the Chinese incentives that Tesla enjoys there.