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

[M3Rider]

I am taking the delay from the Earnings call. Feature complete FSD was “close” by end of year. But now feature complete is a “few months out.” From Elon. The major technical thrusts mentioned are currently in labeling. Put it all together and that is a delayed, open ended project.

Elon’s track record on FSD schedule has been abysmal. I understand it’s an important piece of motivating and organizing his engineering teams to have these ridiculously accelerated schedules. But for investor communication and for customer communication around FSD it is a negative.

They should just acknowledge it’s an open ended schedule and their near term goal is to continually deliver improvement as a driver assist system. Which will be released when ready. With a long term goal of using driver disengagements/behavior to inform improvements and satisfy regulations that ultimately allow full self-driving. No we are almost there. No so close. No just a few months. No thinking about dropping self driving to Early access, just kidding.

These public schedule statements that are never met make the big money FSD option seem more like a vapor ware product. I think FSD option has a compelling value proposition but that isn’t communicated very well.

I wouldn't call 2-3 months delay on an exceptionally difficult challenge a meaningful delay. Particularly in the context of lease cars which will not return for another 2 years.

I just want Elon to be honest and to disclose his current expectations. From that investors can make their own judgement on whether they will be quicker or slower. Its much harder for investors with no transparency at all - in that case first you have to make a wild guess what the company itself is targeting and then again adjust to whether you think they will beat their timeline (as they have on their 2014 production goals for 2020 and GF3 and Model Y launch timelines) or miss their timeline (as they have with Autopilot).

Elon and Tesla have very clearly said their near term goal is to release a feature complete driver assist system. And they have been very clear there is very limited visibility on how long it will take to get from there to an accuracy level where you can remove the driver and then from there when regulators will be convinced to allow Robotaxis.

I don't really care if some investors hate to hear ambitious goals - Elon should ignore investors and just focus on optimising for execution. Ambitious goals are self fulfilling and Elon understands this. This is why he has set the most ambitious goals of any company in the world and this is a key part of the reason why he is rapidly executing on them.
Elon's number one skill is the imagination, creativity and multi discipline knowledge he uses to break down seemingly impossible long term visions into smaller sub tasks that look to be achievable in the near term. He then sets separate teams to deliver on these sub tasks and tells them very clearly what they have to do - Engineers are extremely smart and efficient at doing what they are told, but very few are good at knowing what they should be working on in the first place. Its very important Elon makes people believe these goals are achievable in the near term as this is what motivates his team to work on them and this is what attracts the brilliant engineers to work for him. Without these goals and this belief we would never have reduced the cost of EVs 10x, we would not have landed on the moon in 1969 and we will never achieve self driving cars.

When I'm thinking about delays and better communication needed, I also have some questions.

What I heard yesterday in Third Row podcast is "foundational rewrite that is almost complete".

I think this kinda means that all the progress we've seen up to date is thrown away and they start "from scratch" with a (supposedly) better tech. Only after that the cycle starts on incremental improvements that can lead to regulatory approval.

Did they know about the rewrite in advance? Likely, many months ago. Would they account for more testing needed for a brand new tech before you hand it over to customers? Sounds like this is not just adding a few new features on top of existing framework.

IDK. I think if they saw that this tech was better, then rewrite is warranted. However, with that knowledge the communication of expectations to investors seems too optimistic to me re: feature complete.

 

[MTL_HABS1909]

sadly I think it will

I love being wrong

 

[TheTalkingMule]

Nasdaq down 1%, TSLA........GREEN

Enjoy your afternoon Shortz!

 

[Curt Renz]

Nasdaq down 1%, TSLA........GREEN

Enjoy your afternoon Shortz!

Currently:

--1.9% FCAU
--0.5% F
+0.1% GM
+0.5% TSLA (any positive close will be a record)

 

[gtrplyr1]

Shorts would be wise to use this opportunity to cover. Dow down 400 and TSLA is green? You kidding me???

This baby wants to run, and run it will after the overreaction to the latest plague is done.

Cheers to the longs !

BTW, ordered our 1st Tesla yesterday ... AWD Model Y, White with White interior ! ... hoping we get it by years end.

 

[Nocturnal]

Nasdaq down 1%, TSLA........GREEN

Enjoy your afternoon Shortz!

Many of them seem to be constantly shorting the market in general. That's a weird way to live life, constantly hoping for things to get worse for everyone. Explains a lot about them though.

Shorts would be wise to use this opportunity to cover. Dow down 400 and TSLA is green? You kidding me???

This baby wants to run, and run it will after the overreaction to the latest plague is done.

Cheers to the longs !

BTW, ordered our 1st Tesla yesterday ... AWD Model Y, White with White interior ! ... hoping we get it by years end.

Why did you wait for the Y rather than get a 3? Did you need that SUV functionality?

Personally I'm anticipating plenty of families in that situation. I know when my kids were younger and I was still married we went with an SUV for practicality purposes. Wound up with a Highlander, which although not a Mini-van, still wasn't super cool. I'm betting that a Model Y will keep the practical (usually the mom) person in the family happy, and be cool enough for the other person (usually the Dad). If we can get a take rate for women drivers to be as high as Tesla is with men currently then it will be a blockbuster. ​

 

[wipster]

Schwing!!!

Wow what caused that erection of the chart?

 

[Chickenlittle]

Really good video from Cramer yesterday on Tesla and why it's following the Netlix and Amazon stories. He makes some nice digs at the shorts, admits he was wrong on the stock etc. I don't know about you guys, but hearing good things about Tesla from the media is still novel.

Also, can you believe people give this guy money to invest for them? Not even the fact that he thinks this, but that he is so unaware or so insulated in a bubble of internet trolls, that he thinks it's not a problem to share these views? "If you don't allow Hollywood execs to pray on women then action movies won't be good." What even?

View attachment 506319

Same. I have a 2/7 call at $585 that I'm holding. ​

I don’t know your experience level with options but your losing time value and now your option is deep in the money. If you believe it’s going up would be better to sell it and buy one out of the money. For every dollar the stock goes up your new option would perform better

 

[EinSV]

Andrea James summing things up nicely IMO:

Andrea S. James on Twitter

 

[TheTalkingMule]

Many of them seem to be constantly shorting the market in general. That's a weird way to live life, constantly hoping for things to get worse for everyone. Explains a lot about them though.

We're running hot and overdue a recession, as a contrarian myself I see it as a perfectly rational option in the macro. Just not a great idea with TSLA.

 

[AudubonB]

I agree with your categorisation of Elon's shares generally, but S&P has their own clear definition for free float and it includes a very broad group of exclusions which would include all of Elon's shares:

https://us.spindices.com/documents/index-policies/methodology-sp-float-adjustment.pdf

Informative and, in part, suggestive of some consistency, in that they treat certain other shares as similarly sticky. But it is obvious at anything more than a cursory glance that someone is overly active in the Let's Find Shares To Exclude Department.
The institutional investment universe, though, now is such that to some approximate degree of equality, Company A, B & C share similar degrees of lockedupitness, then, and Mr Musk's large fraction is not so egregious as otherwise would be the case.

HOWEVER......with S&P's indices thereby so restricted in terms of what they call free float, I am 99.94% certain they are double dealing in claiming their indices represent $X trillion of market cap: to be representative, they would have to adjust that to be {some small % of} $X trillion. But then their marketing clout would be oh so much smaller.

 

[ReflexFunds]

When I'm thinking about delays and better communication needed, I also have some questions.

What I heard yesterday in Third Row podcast is "foundational rewrite that is almost complete".

I think this kinda means that all the progress we've seen up to date is thrown away and they start "from scratch" with a (supposedly) better tech. Only after that the cycle starts on incremental improvements that can lead to regulatory approval.

Did they know about the rewrite in advance? Likely, many months ago. Would they account for more testing needed for a brand new tech before you hand it over to customers? Sounds like this is not just adding a few new features on top of existing framework.

IDK. I think if they saw that this tech was better, then rewrite is warranted. However, with that knowledge the communication of expectations to investors seems too optimistic to me re: feature complete.

I think its very likely they've been working on this path since soon after Karpathy joined. I expect Elon was counting on this re-write being complete when he made all his Autopilot and FSD comments last year.

Its not throwing away existing progress. The existing software rolled out to the fleet has allowed Tesla to build its edge case list and set the fleet to collect data on each scenario. All of this data and labels still exists on Tesla's servers and will be used to train the new nets - which they have likely been doing for the past two years. There will also be lots of software carried over into the new system.

The old software still has a lot of value in all of the AP and EAP software released in customer cars today, and I expect Tesla will still have teams working on incremental improvements to this software path (plus for those with FSD computers, simply scaling up the neural net size using the existing code base to increase accuracy).

 

[Chickenlittle]

Or that they say sorry, Tesla Giga3 will remain shut down for the entirety of Feb. Maybe longer? And then the shorties blow up the news.

So your anticipating and trying to blow it up earlier. I am concerned about the virus but also note this is not a bad time for this if it had to happen. I suspect construction on model y still going on and loss of cars/week is less now than if we ran into this with production at full steam

 

[Nocturnal]

I don’t know your experience level with options but your losing time value and now your option is deep in the money. If you believe it’s going up would be better to sell it and buy one out of the money. For every dollar the stock goes up your new option would perform better

Not very and I was wondering about that myself. Will consider that thx.

 

[AudubonB]

(So literally the only protected animals that have to be relocated are anthills.)

Breaking News:

This just in from Gus's nursery -

The ants go marching three by three
Hurrah! Hurrah!
The ants go marching three by three
Hurrah! Hurrah!

The ants go marching three by three
To leave the Gigafactory
And they all go marching
Out of the woods
To get out of the way.

 

[neezer]

So your anticipating and trying to blow it up earlier. I am concerned about the virus but also note this is not a bad time for this if it had to happen. I suspect construction on model y still going on and loss of cars/week is less now than if we ran into this with production at full steam

Correct, The CFO said on the call that the factory is definitely not running full steam, so it's a minor hiccup for them relatively. Yeah if this happens/happened say this summer, it would be worse for sure to the bottom line.

Apple if anyone is most impacted I say...Huwan is an epicenter of not just corona, but for production for things that go into Foxconn's assembly line, apparently.

 

[gtrplyr1]

Many of them seem to be constantly shorting the market in general. That's a weird way to live life, constantly hoping for things to get worse for everyone. Explains a lot about them though.

Why did you wait for the Y rather than get a 3? Did you need that SUV functionality?

Personally I'm anticipating plenty of families in that situation. I know when my kids were younger and I was still married we went with an SUV for practicality purposes. Wound up with a Highlander, which although not a Mini-van, still wasn't super cool. I'm betting that a Model Y will keep the practical (usually the mom) person in the family happy, and be cool enough for the other person (usually the Dad). If we can get a take rate for women drivers to be as high as Tesla is with men currently then it will be a blockbuster. ​

Yes I needed the SUV style as I'm a professional musician and I'm always putting gear in and out of the car .... a trunk is really a pain in the neck ... and back!

Also, like most people these days we like to sit a little higher and the SUV form factor is really what we are used to as this point as this car will replace our Mazda CX9. We considered waiting for the optional 3rd row but I think it won't really be that useful and there are only a handful of times we will need it ....

 

[MP3Mike]

What I heard yesterday in Third Row podcast is "foundational rewrite that is almost complete".

I think this kinda means that all the progress we've seen up to date is thrown away and they start "from scratch" with a (supposedly) better tech. Only after that the cycle starts on incremental improvements that can lead to regulatory approval.

Will the new re-written code run on AP2/AP2.5? Or will it be limited to the FSD computer? This could be the inflection point where non-FSD purchasers with older hardware get left in the dust. (Which could trigger more people paying for the FSD upgrade.)

 

[Mike Smith]

Very nice cup and handle formation complete just now..

 

[SOULPEDL]

Shorts would be wise to use this opportunity to cover. Dow down 400 and TSLA is green? You kidding me???

This baby wants to run, and run it will after the overreaction to the latest plague is done.

Cheers to the longs !

BTW, ordered our 1st Tesla yesterday ... AWD Model Y, White with White interior ! ... hoping we get it by years end.

Cool. This reminds me of being stuck at 580 recently only now it's all about 650 like it's recoiling for the next jump to 700.