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

[Driver Dave]

Not many companies could have the CEO say stock too high imo one week, and start the week up the next.

TSLA Long

Nothing can stop it...

 

[jerry33]

Um Fremont is crazy inefficient because it's a mishmash of different production lines that were added at different times. While the Bay Area has great engineering talent, that's not needed for manufacturing line workers.

The problem is that when the designers and engineers are remote, you get the 2013 S' defroster that wouldn't defog the driver's side of the windshield (because the designers never experienced actual winter driving). They need to be together or there will be issues.

 

[bubb]

Um Fremont is crazy inefficient because it's a mishmash of different production lines that were added at different times. While the Bay Area has great engineering talent, that's not needed for manufacturing line workers. The S/X will need to majorly updated or revamped considering its fundamentally the same line they've had for years. They could easily drop the prices of the S/X by moving production to Giga 1 on the cost savings which would then lead to greater demand for the vehicles.

On a cost basis, it would save a ton of money to move manufacturing out of Fremont. Tons of money. California and the Bay Area is super expensive for manufacturing.

I think that is saving pennies to lose dollars. My point about engineering talent has nothing to do with line workers. This factory is "messy" because it has been their laboratory for iterating and innovating in manufacturing. If a fancy robot breaks at a Ford plant, a contractor is called and line workers twiddle their thumbs. If it breaks at Fremont, and it's important enough, they have some of the smartest engineers in the company (and often the CEO) available to drive over within the hour. Once they have some slack they can slow things down there, but we are far from that point IMO.

 

[feigen66]

I am very confused by the rules, especially rule 3.

The testing goal is 200/100k/d. The 7 day average is 28 for Alameda county? So if the current trend keeps going, fewer cases every day and less and less people need/want testing, then the 200/d goal will NEVER be achieved? So the lockdown can go forever because it is so effective and self-strengthening?

On the other hand, it is so easy for telsa to force the end of lockdown, take the deeds in its hand and meet the 5 rules, actually only rule 3 and 5 are not met for the county.
1. buy tests and start testing tsla employees residing in the county NOW. The county has 1.7m population. So tsla only needs to test 3500 employee per day.
2. buy 30 days of PPE and donate to the county medical facilities.

It will only cost several million. Tsla shareholders are losing billions due to the lockdown.

200/100k/d is a strawman goal, even Newsom admitted that in the conference that they did not know how to properly set the number.
My guess is the number will be somewhere in between. All the hospitalized patients will get tests other than the ones having symptom.

Here is what Kaiser just sent out this morning

"Across Northern California, we've tested tens of thousands of patients for COVID-19 so far. At the beginning of the pandemic, we faced national shortages of test kits. Testing needs quickly overwhelmed public health department labs. We had to wait 10 to 14 days for test results — far too long to be useful in determining safe treatment for very sick patients.

In response, our lab teams increased capacity to process more COVID-19 tests of hospitalized and high-risk patients. We rolled out drive-through testing sites to protect our patients and care teams. And soon we'll open a 7,700 square foot lab in Berkeley, which will have the capability to process 10,000 COVID-19 tests from around the region per day.

We're so thankful to the City of Berkeley, our lab teams, and construction partners who've been working day and night to build this lab in just 60 days. This kind of dedication is what helps us care for patients without delay. With this level of testing, we can start to shift from testing only hospitalized and high-risk patients to far more of our members. Large-scale testing is one of the 6 indicators Governor Newsom said is foundational to easing the stay-at-home order in California."

I agree TSLA should just administrate their own test. Their Fremont facility has a fairly big EMS office to do such thing.

 

[LN1_Casey]

I think that is saving pennies to lose dollars. My point about engineering talent has nothing to do with line workers. This factory is "messy" because it has been their laboratory for iterating and innovating in manufacturing. If a fancy robot breaks at a Ford plant, a contractor is called and line workers twiddle their thumbs. If it breaks at Fremont, and it's important enough, they have some of the smartest engineers in the company (and often the CEO) available to drive over within the hour. Once they have some slack they can slow things down there, but we are far from that point IMO.

Yeah, but Fremont formed when Tesla was still a no-name brand. Now, they've got the pick of each graduating class for all of the top tier engineering schools in the States, if not the world.

If they moved their HQ to, say, Austin for the new GF, do you think that those Engineers will all just shrug and find someone nearer in California? Or would they follow the business they believe in, and feel like they can succeed at and make a difference?

 

[TheGrimSweeper]

Gavin Newson needs to act soon because the state is starting to re-open whether he likes it or not.

California Counties Start Re-opening defying State

Orange County Restaurants and Shops Re-opening defying state

At this point, if he doubles down on his closure stance it will have a very unproductive outcome. More and more people and business will start defying it. Especially as local police aren't enforcing it.

The OC Restaurant told the city they were re-opening, nobody stopped them.

He needs to start granting permission for things to re-open while following safety protocols.

Hopefully the Bay Area follows the state. But I could see them trying to drag it on longer.

 

[feigen66]

Currently the list of local county officials ask to modify or defy or filed suit Gov. Newsom's Stay-in-Home order as of today:

1. Riverside
2. Orange
3. Modoc
4. Kern
5. San Luis Obispo
   
6. Sutter
   
7. Yuba

California has 58 counties, so that represents 12% of counties.

Not all counties that requested modification of Shelter-in-Place order are Republican leaning. We shall see if the number of counties can go to double digit by the end of week. If 1/4 of counties request modification of Shelter-in-Place then a state-wide restriction will be rendered useless.

 

[StarFoxisDown!]

I think that is saving pennies to lose dollars. My point about engineering talent has nothing to do with line workers. This factory is "messy" because it has been their laboratory for iterating and innovating in manufacturing. If a fancy robot breaks at a Ford plant, a contractor is called and line workers twiddle their thumbs. If it breaks at Fremont, and it's important enough, they have some of the smartest engineers in the company (and often the CEO) available to drive over within the hour. Once they have some slack they can slow things down there, but we are far from that point IMO.

Your example doesn't really hold weight because Tesla is actively building factories far away from the engineering talent where the above scenario you painted would happen anyways. Tesla actively send engineers to China. Elon actively travels to Texas to work with SpaceX.

Either way, I very much disagree with your assessment that moving manufacturing out of of Fremont would save pennies to lose dollars. The fixed costs of labor in the bay area verses Sparks as well as the fact that they have to transport battery packs every single day to Fremont mount to big costs that they won't be paying Giga China, Giga Berlin, or Giga Texas(or wherever the new US factory is). The Bay Area is one of the most expensive places for manufacturing in the world. Fremont isn't a "laboratory" for iterating and innovating.....it was a means to an end in terms of getting production going for a company that only had one manufacturing facility. That's not the case anymore. I'm all for using Fremont as a test ground for future manufacturing innovations, efficiencies, etc......but there is zero reason actual manufacturing need to be done there.

Also, just a reminder in my original post I said the scenario I laid out would take place in 2-3 years time.....after Giga China is in full 3/Y/Battery production, Giga Berlin is in full production of Y/Battery, and Giga Texas/US is in full Cybertruck/Y/Battery production.

 

[sdtslafan]

So does the market think that when Elon said the stock was too high, he meant too high by a few bucks?

Maybe the stock is too low now...

 

[StarFoxisDown!]

I will add that if FSD and robotaxi service actually happens in 2-3 years, Tesla(and thus us) will be swimming in so much money that no one will care if Fremont costs more or if there's a threat of Fremont shutting down

 

[TheTalkingMule]

If they moved their HQ to, say, Austin for the new GF, do you think that those Engineers will all just shrug and find someone nearer in California? Or would they follow the business they believe in, and feel like they can succeed at and make a difference?

Honestly I think it would be about 50/50. People talk big about "moving to TX or FL for tax purposes!", but most people aren't really interested in actually living there.

 

[Beltsbear]

Um Fremont is crazy inefficient because it's a mishmash of different production lines that were added at different times. While the Bay Area has great engineering talent, that's not needed for manufacturing line workers. The S/X will need to majorly updated or revamped considering its fundamentally the same line they've had for years. They could easily drop the prices of the S/X by moving production to Giga 1 on the cost savings which would then lead to greater demand for the vehicles.

On a cost basis, it would save a ton of money to move manufacturing out of Fremont. Tons of money. California and the Bay Area is super expensive for manufacturing.

Fremont is not optimized. But it is not ‘crazy inefficient’ either. During this downtime I hope they used some of it to clean up and further optimize.

 

[neezer]

I'll see that and raise you:
View attachment 538186


From my backyard.
In the Santa Cruz mountains, 12 minutes from the Valley

Wow, hard to beat that view in the US. Maybe I should move to CA

 

[Prunesquallor]

I think that is saving pennies to lose dollars. My point about engineering talent has nothing to do with line workers. This factory is "messy" because it has been their laboratory for iterating and innovating in manufacturing. If a fancy robot breaks at a Ford plant, a contractor is called and line workers twiddle their thumbs. If it breaks at Fremont, and it's important enough, they have some of the smartest engineers in the company (and often the CEO) available to drive over within the hour. Once they have some slack they can slow things down there, but we are far from that point IMO.

Somehow they are managing in Shanghai. And plan to in Berlin.

 

[dw4ngg]

"The Sell In May And Go Away" works under normal conditions ... Not this time ... Market looking to rebound as soon as economy starts humming back.

If Ants cannot work, grasshoppers cannot hop ....

For TSLA, it’s “buy in May, we’re here to stay!”

 

[StarFoxisDown!]

Fremont is not optimized. But it is not ‘crazy inefficient’ either. During this downtime I hope they used some of it to clean up and further optimize.

Maybe not crazy inefficien compared to today's standards. But I think full production Giga china/berlin/Texas will show us just how inefficient it is compared to where tesla will be in 1 to 2 years

 

[Prunesquallor]

Yeah, but Fremont formed when Tesla was still a no-name brand. Now, they've got the pick of each graduating class for all of the top tier engineering schools in the States, if not the world.

If they moved their HQ to, say, Austin for the new GF, do you think that those Engineers will all just shrug and find someone nearer in California? Or would they follow the business they believe in, and feel like they can succeed at and make a difference?

And if they shrug, engineers from UT, Rice, etc are right handy.

 

[wtlloyd]

Currently the list of local county officials ask to modify or defy or filed suit Gov. Newsom's Stay-in-Home order as of today:

1. Riverside
2. Orange
3. Modoc
4. Kern
5. San Luis Obispo
   
6. Sutter
   
7. Yuba

California has 58 counties, so that represents 12% of counties.

Not all counties that requested modification of Shelter-in-Place order are Republican leaning. We shall see if the number of counties can go to double digit by the end of week. If 1/4 of counties request modification of Shelter-in-Place then a state-wide restriction will be rendered useless.

None of these are "Blue" counties, in fact, some of them are quite hard-right Libertarian leaning, and profess to prefer succession, to form the independent state of "Jefferson".
My point is that they could be predicted to buck Sacramento. Orange and Riverside are pretty populous, the others, not so much.

 

[Jack6591]

Wow, hard to beat that view in the US. Maybe I should move to CA

LA has its days!

 

[SpeedGoat]

Honestly I think it would be about 50/50. People talk big about "moving to TX or FL for tax purposes!", but most people aren't really interested in actually living there.

That isn't what the statistics show:

Florida, Arizona, Texas, North Carolina, South Carolina (in that order) are the leaders for net US domestic migration.

Meanwhile...

New York, California, Illinois, New Jersey, Louisiana (in that order) are the biggest losers.

List of U.S. states and territories by net migration - Wikipedia


Personally I am skeptical Elon would want to pick up and move out of CA all at once. It would be far to disruptive and expensive at a time the company is working hard to grow... but he could certainly stop investing in CA and bit by bit move the company out over the next 5-10 years. It would be a replay of what happened to the other auto plants in CA over the years...