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

[jbcarioca]

Very good stuff, as usual, and we have come to rely on your commercial bank experience for lifting the carpet under some of those musty, dusty floors to learn what's crawling underneath.
My comment was specifically referring to passive index funds and their penchant for lending, however. So, unless you can convince me that the sheer size of the prime actors are so massive that they can indeed cut off their limbs to feed their maws, as it were*, then I'll stand by my comment.


*Can't fit into that reference the real point: If an entity or group of like-acting entities is such a massive player in a market - let's call it Brown Brothers Heisenberg & Co. - that lending all its shares out to short sellers can indeed drive the market down - and thus one might infer it is acting in contradiction to its and its clients' best interests. Better rename itself Brown Bros. Ouroboros & Co. BUT even in this head-swirling situation, that fund would STILL be outperforming - on an absolute scale - its index. Nonetheless: yuck.

Short version: I believe we were discussing different points.

PS: You placed BBHarriman in both the Inner 4 and Outer 3 groupings. Am trying to remember who the other actor is in fact. T. Rowe Price? Capital? Bessemer Trust?

The four who have the most total integration with high total asset values in mutual funds and other related categories (sorry for the qualifiers) are: BNY Mellon, Black Rock, State Street and Fidelity. The four are dramatically different.
BNY Mellon and State Street are both very old-line Wall Street correspondents including custodians, clearing agents, etc. Both built from the earliest days of public securities in the US. Both did securities lending from the earliest days. Fidelity has it's roots in a depression-era mutual fund that was gIven all it's growth and fame by the Johnsons who acquired control during WWII. Everything it does was about increasing earning from funds. Black Rock started from scratch but after acquisition including PNC they acquired/built execution capability. In the end they have become by far the largest ETF operator. No surprise, ETF's are magic for fees.

That is probably more than anybody here wants to know. Included here is the single name that benefits more than any other from short selling/securities lending, fully affiliate managed public funds.

Oddly that single entity has many Tesla owners who are serious fans.

 

[copyhacker]

To me it is further proof we are at a tipping point.

I got to wondering how and why this tipping point has been reached. It seems so many different part's had to come together to make it happen.

To me, the tipping point was the Nurburgring. The apotheosis of old guard car engineering had the means, motive, and opportunity to deliver a “hardcore smackdown” (Elon’s own words) to Tesla. They either couldn’t do it or lacked the willpower to Osborne themselves.

Maybe not the beginning of the end, but at least the end of the beginning.

 

[Krugerrand]

"The new Mercedes-Benz EQC, which will enter the market next year doesn't have a frunk"
"Daimler intends to produce the EQC together with the C-Class, GLC and GLC Coupe, on the same production line..."
WTF?

"The front drive module and the rear axle assembly arrive at the factory already bolted to their subframes before being installed to the chassis..."
WTF?

I thought there was no frunk because of that cool 300 lb engine block/transmission structural simulator.

View attachment 496638

And now it turns out you can’t even show it off to your friends. It’s covered up by plastic panels. Bummer.
View attachment 496644


Daimler evidently mis-read the rules for avoiding 2020 emission penalties. You actually have to sell the EVs.

 

[Fact Checking]

View attachment 496616
@Fact Checking posted this image on Dec 10th. You’ll notice there’s much more detail in the rendering on the building to the right of the new parking area. I’ve been thinking this building will be the Model Y building. It’s labeled Phase 3 in the picture but I don’t think that’s correct now with what’s happening on the grounds. The building will be the same as the present assembly building minus the stamping area. It will be flipped 180 degrees with the paint shop at the far right end as in the above image. There’s been speculation the stamp area will supply both Model 3 and Y. Body in white would flow to the right, on the side nearest the battery assembly building. Paint shop at the far end. General assembly would flow back to the left with completed cars exiting near the new parking area.

That’s my guess at this point. I wouldn’t be surprised to see pile drivers show up anytime now.

Note that there's an update to the GF3 layout:

I found an interesting piece of information about the layout of GF3 while browsing photos of today's GF3 delivery ceremony, a GF3 blueprint on the sweatshirt of one of the employees:

If we zoom in on that factory floor plan, we can see interesting details, not previously disclosed AFAIK:

View attachment 494325​

Edit, found a sharper one:

View attachment 494329​

Labeled with my guesses:

• The current "Model 3" factory is the lower left quadrant of the factory plan.
• We can see the "mirrored" approach of doubling the production lines - speculated to be "Phase 3" "Model Y" lines (marked "Phase 2" in the image below), in the upper left quadrant of the factory. It clearly has another paint shop, body shop and assembly line.
• The stamp shop (square building in the middle area) is not duplicated for the Model Y.
  
• The "Battery Workshop" (also rumored to host motor production) is in the upper right quadrant.
• There's a mystery building in the upper left quadrant (the most distant corner), which doesn't appear to be similar to any of the existing facilities. Seat factory? Semi production? Cell factory?

Also see this earlier post I wrote about another leaked GF3 factory floor plan, which had this layout:

The "sweatshirt leak" seems to confirm the earlier layout, that the stamp shop is a shared facility. This should speed up the Model Y construction work in 2020.

 

[mongo]

Note that there's an update to the GF3 layout:

? May be a foundry for all the castings.

 

[jbcarioca]

... I cannot see how a car company will survive without a factory.. .

While I agree with you about NIO it is a fact that for many manufacturers contract manufacturing is useful for low volume and/or different technology vehicle. There are some big-name exmples:

Porsche Boxster was first produced by Valmet of Finland;
Jaguar I-Pace, many BMW convertibles, several FCA models (Chrysler and Jeep) all produced by Magna-Steyr;
Buick Envision produced by BAIC;
and the list goes on.
Especially for BEV's a fair number of brands are touting their own capability when they are actually beginning to produce Chinese-built, Chinese-designed BEV components with German positioning and packaging.

All this is nothing new. It's been common practice for decades.

All that is novel for NIO is skipping the factory entirely. Were the design to be outstanding and the packaging, promotion and support to be excellent there is no reason why this would not work. NIO seems to have skipped a few steps...

This really is pretty much the APPL modus and it works brilliantly. It does require unusual attention to detail and superb quality control.

 

[StealthP3D]

Not really....my experience has been over confidence is a common trait with smart people.
Jack is smart in some area's.....not in all area's.

Well, if the over-confidence is justified...then it's not over-confidence.

We will know soon enough.

 

[avoigt]

Some interesting information about the Taycan Turbo S

Taycan Turbo S in selected Showrooms in Germany to be delivered after Jan 21st.

Video in German:
16:42 Panel gaps at pre production model (no a real concern but still bad)
17:37 Display does not react, Sales lady said its because there is no internet access ... ?
18:45 Average consumption 42.5kwh/100km

Range according to display 281km or 174mi

 

[Artful Dodger]

Note that there's an update to the GF3 layout:

The red ? can only be for bty cell production. No other process for making components of the cars would require so much production space.

EDIT: @mongo rightly points out a foundry for all the castings would also fit is such a space

It's not like Tesla is going to 'vertically integrate' steel or tire production for its product.

At least not in the next 2 years....

Cheers!

 

[VValleyEV]

from the tops of their pitchforks to the bottom of their hooves

I love a good turn of phrase, and an apt metaphor thats brings a smile.

 

[MP3Mike]

250kW max. At best they'll wire it to be capable of more for whenever they make "V4" Superchargers. But having just introduced V3, even that's dubious.

Elon did hint that the 250kW charging rate was not going to be the maximum for the Cybertruck. Maybe we will hear more about that on battery/drivetrain day.

 

[KarenRei]

The red ? can only be for bty cell production. No other process for making components of the cars would require so much production space.

EDIT: @mongo rightly points out a foundry for all the castings would also fit is such a space

It's not like Tesla is going to 'vertically integrate' steel or tire production for its product.

At least not in the next 2 years....

Cheers!

My speculation has been toward the same thing.

 

[Krugerrand]

I don't think Elon ever imagine how thick the legacy auto makers would be. I imagine he thought there was a chance Tesla would have a short period of success and then big auto would see the error of their ways and adapt and overtake him quickly. Tesla could easily produce more EVs than many major automakers produce cars in 2-3 years. I think at this point Elon knows he's got leverage he never imagined he'd have in his wildest dreams.

Elon has expressed his disappointment in OEMs. He’s at times expressed anger, disbelief, and occasional praise as well.

He’s clearly for humanity, but also for himself when he feels he’s been treated unjustly. He’s a very shrewd businessman but also has brokered deals that are quite obviously to the benefit of all parties involved.

I think it’s too late for OEMs to get much of a free ride from Tesla. Tesla has had to fight and claw for every inch. Just reflecting on what has happened in the last decade is mind boggling. All the Tier 1 suppliers who wouldn’t supply Tesla in the beginning, the companies who made Tesla vertically integrate; that German Falcon Wing door company, MobileEye, the company that messed up Giga1 battery module line, just to name the obvious ones.

Any significant partnerships required to save an OEM at this point, I have to believe would be designed to heavily favor and protect Tesla from risk, which means the OEM/s would have to carry the burden of risk. Don’t see that happening.

 

[Compton]

Some interesting information about the Taycan Turbo S

Taycan Turbo S in selected Showrooms in Germany to be delivered after Jan 21st.

Video in German:
16:42 Panel gaps at pre production model (no a real concern but still bad)
17:37 Display does not react, Sales lady said its because there is no internet access ... ?
18:45 Average consumption 42.5kwh/100km

Range according to display 281km or 174mi

Tesla's position among the incumbent firms reminds me of the following prison scene in Watchmen;

 

[KarenRei]

Elon did hint that the 250kW charging rate was not going to be the maximum for the Cybertruck. Maybe we will hear more about that on battery/drivetrain day.

What hint was that? Note that Cybertruck won't be out for a long time, so it wouldn't be as unusual.

 

[SebastianR]

On how far Tesla is ahead of the others: One of my pet peeves with my old Audi was that they never updated the software. I mean, I didn't expect wonders from a legacy car maker but the obvious stuff that newer models could do anyways, why not throw a bone to the existing owners?

I thought this is history since the eTron can do OTA updates. However, Audi seems to not even update software of cars that are literally only a few months old: Audi upgrades e-tron electric SUV in Europe with more range and efficiency - AudiWorld Forums

Audi has announced minor hardware and software upgrades for its all-electric e-tron SUV.The German car maker says the new measures will be applied to future models and will increase the range to 271 miles (436 km) – an increase of 15 miles (24 km).

Also German Audi forums are (rightfully) quite upset about this...

 

[dc_h]

My guess is, it’s for any small repairs / fixes to be carried out before the cars are loaded up onto carriers. It might also be a cleaning or prep station. Equally, it could become some sort of office space to process transport documentation as the cars are being loaded up.

Could be plant sales/delivery site? If they have an event this week, they may need a site onsite and indoors for delivery.

 

[Right_Said_Fred]

The OT ‘Lidar can blind people and cameras’ discussion was moved here (for lack of a better destination): Fixed object detection in Autopilot/FSD (out of main)

 

[MP3Mike]

TSLA could be at any price between $600 and $300 on February 21st and he will have lost everything. Truly a baffling bet. I mean, why not purchase fewer options ATM instead so you'll at least make money on one side or the other?

Not true. For starters he still has 300 shares of Tesla. (30% of his original position.) He also has 40) 3/20/20 $600 Call contracts.

Not to mention that he only spent 46% of the money he got selling the 801 shares. So he has already taken profits.

 

[MP3Mike]

What hint was that? Note that Cybertruck won't be out for a long time, so it wouldn't be as unusual.

You're right he didn't hint at it, he outright said it. During the Cybertruck reveal he said it "would be capable of more than 250kW charging. We will reveal the actual number later."

The screen also had a + just like the range numbers.