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

[Buckminster]

New thread setup following zero popular demand:
Tesla mRNA microfactories

 

[wipster]

I just got an email from Tesla telling me thta the shortz shorts were avaialble...I immediately opened my account...and they did have shorts available..if my wife was a medium or large>
Forgive me. I have been blessed. Only XS fits her...especially something as S3XY as this.... so dang it...

They're will be XS sizes on eBay soon, just wait... but you may have to pay more...;-)

 

[Big Time]

Futures...Yes please.

gotta busy day ahead of me sitting on my ass making money laughing at the shorts.

 

[wipster]

She worked at The Wall Street Journal and is friends with Charley Grant a writer for the journal he also writes hit pieces on Tesla, and btw his father is best friends with Chanos. Basically she's part Chanos's network of "bozos"*

* Jim Cramer reference

I will never ever trust Chanos...

 

[Artful Dodger]

'Inside Look At New Car Company Canoo' | Jay Leno's Garage (34 min ago)

 

[UnknownSoldier]

She worked at The Wall Street Journal and is friends with Charley Grant a writer for the journal he also writes hit pieces on Tesla, and btw his father is best friends with Chanos. Basically she's part Chanos's network of "bozos"*

* Jim Cramer reference

I guess it's amazing watching Thanos fighting solo after literally every other big name ally has already capitulated. I guess for him, his reputation is on the line here, either Tesla falls or no one will ever believe any of his future short theses ever again. He will never give up, never surrender, until the day he dies maybe.

I need more money though, so maybe that's a good thing. I wonder how much Thanos has transferred to TSLA investors already...

 

[FrankSG]

What's the collateral for the loan? Is it stock or something else? Will you get a margin call in cast TSLA goes down?

If you don't have a risk of getting margin called, and you have enough monthly incone to pay it off, I don't see much risk here.

Not advice.

Only other risk is that source of income falling away.

I don't know how much @Twooz 's yearly income is, but another thing that might accomplish what you want is this:

If the amount you're thinking of borrowing is 100 shares worth ($120k), and you already own 500 shares, you could sell 200 shares to buy 3 Jun'21 $400 call options, and use the $120k one year from now to exercise the 3 options. You'll pay a small premium on the call options (currently trading at $831), so ~$6k or 5% of the $120k, but this might also be worth considering.

 

[samppa]

Only other risk is that source of income falling away.

I don't know how much @Twooz 's yearly income is, but another thing that might accomplish what you want is this:

If the amount you're thinking of borrowing is 100 shares worth ($120k), and you already own 500 shares, you could sell 200 shares to buy 3 Jun'21 $400 call options, and use the $120k one year from now to exercise the 3 options. You'll pay a small premium on the call options (currently trading at $831), so ~$6k or 5% of the $120k, but this might also be worth considering.

Also consider taxes - if you get taxed for selling shares, this approach might not be so feasible.

 

[AZRI11]

'Inside Look At New Car Company Canoo' | Jay Leno's Garage (34 min ago)

Hyundai will build electric vehicles with EV startup Canoo

 

[Johann Koeber]

Short shorts... please no pictures folks!

76 Euro in Germany.

Too much money.

Ordered some anyway.

 

[Off Shore]

Alex, you mention the German auto industry was able to succeed and increase their margins, in part, by outsourcing heavily and this isn't the first time I've heard the idea that outsourcing can save money.

At first look, it would seem the company supplying the outsourced parts would have all the same expenses the auto company would have if the parts were made in-house (wages, benefits, land, building, taxes, utilities, raw materials, equipment, etc). But on top of those costs, the outsourced parts need to be transported to the auto plant and there is a certain duplication of CEO and upper management functions.

So my question is, by what mechanism does outsourcing save money?

In the ICE world anything that doesn't differentiate the brand is bought from OEMs, which can offer economy of scale because they can make e.g. 10 million alternators instead of one million. It's been a vigorous, healthy supply chain (most of the time) for decades. Also means that ICEmakers know about engines and supply chain management and not very much else.

 

[StealthP3D]

In the ICE world anything that doesn't differentiate the brand is bought from OEMs, which can offer economy of scale because they can make e.g. 10 million alternators instead of one million. It's been a vigorous, healthy supply chain (most of the time) for decades. Also means that ICEmakers know about engines and supply chain management and not very much else.

If it's just a volume game then Tesla can win the game by using their existing lead while continuing to grow volumes and remaining vertically integrated.

 

[thait84]

Just wondering if ya'll are picking up more shares at current prices or just riding with what you have?

 

[SwTslaGrl]

If it's just a volume game then Tesla can win the game by using their existing lead while continuing to grow volumes and remaining vertically integrated.

I've heard here over the years that the OEM expects the subcontractor to have yearly reduction in costs and lower prices for the subcontracted parts. It's the subcontractor that has to to the hard work in making production more and more efficient.

 

[Mike Smith]

I'm really upset that the biggest size they have is 33" waist. I'm going to have to lose about 10 pounds or I'm going to look very foolish at the shareholder meeting.

 

[avoigt]

Alex, you mention the German auto industry was able to succeed and increase their margins, in part, by outsourcing heavily and this isn't the first time I've heard the idea that outsourcing can save money.

At first look, it would seem the company supplying the outsourced parts would have all the same expenses the auto company would have if the parts were made in-house (wages, benefits, land, building, taxes, utilities, raw materials, equipment, etc). But on top of those costs, the outsourced parts need to be transported to the auto plant and there is a certain duplication of CEO and upper management functions.

So my question is, by what mechanism does outsourcing save money?

Its been an approach Lopez initiated about 2 decades back with some automakers one of them, VW, by reducing vertical integration. As you summarized in an accurate way costs to produce in the supply chain do not go down therefore what is the benefit?

What they did was to ask suppliers to supply parts they produced themselves before but what they did not tell them is that they intend to press cost down to the blood and reduce the margin of the suppliers, therefore, they have the revenue but the profit is with the OEM. As a large automaker you can do that because suppliers had often only one customer e.g. VW and giving the buying power they could mandate. VW, on the other hand, had many suppliers who could deliver that part therefore the sourcing department had the power.

That worked extremely well and OEMs even motivated their own workforce to start their own company outside of the OEM . They even gave tooling away just to get rid of production.

All of that works only in a mature technology industry where you do not have a lot of inventions anymore. When this changed with BEVs they have been caught naked since suppliers don't do the invention you need to have. The interview with Peter is a good example when he said they did not deliver on their promises.

 

[MC3OZ]

If it's just a volume game then Tesla can win the game by using their existing lead while continuing to grow volumes and remaining vertically integrated.

In the era when some of these original decisions were made, engineering drawings were done by hand, the set up to manufacture of a new part was probably a very time consuming process.

These days we have CAD/CAM, robots, 3-D printers and other flexible equipment.

Tesla's cost advantage comes from innovation and using a different part.

The biggest example of that is the giant casting machine, fair chance that changes the equation on car body manufacture very substantially.

I think we will find Tesla has had to optimise the cost of building the rest of the car due to the high cost of batteries, as they walk the cost of an EV drive-train down below the cost of an ICE drive-train those other advantages count..

Long term some parts might be cheaper from suppliers, but raw materials and equipment typically cost the same, Tesla already has the design and the software to drive the machines... a supplier has to pay rent, electricity, wages, etc and make a margin.. parts need to be shipped from the supplier to Tesla.

 

[MC3OZ]

Its been an approach Lopez initiated about 2 decades back with some automakers one of them, VW, by reducing vertical integration. As you summarized in an accurate way costs to produce in the supply chain do not go down therefore what is the benefit?

What they did was to ask suppliers to supply parts they produced themselves before but what they did not tell them is that they intend to press cost down to the blood and reduce the margin of the suppliers, therefore, they have the revenue but the profit is with the OEM. As a large automaker you can do that because suppliers had often only one customer e.g. VW and giving the buying power they could mandate. VW, on the other hand, had many suppliers who could deliver that part therefore the sourcing department had the power.

That worked extremely well and OEMs even motivated their own workforce to start their own company outside of the OEM . They even gave tooling away just to get rid of production.

All of that works only in a mature technology industry where you do not have a lot of inventions anymore. When this changed with BEVs they have been caught naked since suppliers don't do the invention you need to have. The interview with Peter is a good example when he said they did not deliver on their promises.

I'm surprised this is so recent. What is surprising is that a small outside suppler can produce the part for a lower cost than the original part designer. using the same equipment.. that indicates the original manufacturer is not an efficient well run business. The main differences have to be productivity and wages, electricity and raw materials should cost less for a larger company

 

[LN1_Casey]

If TSLA is above $3000 by the shareholders meeting, I promise I will show up to the Fremont Factory wearing this in XL and absolutely nothing else.

I don’t think I’ve ever had such conflicting feelings about the SP reaching 3k by September.

 

[astrotoy]

Could you explain the tax change a little more please? What do you mean "second lifetime"? Who exactly does this affect and when?

Thanks!

Before the US Tax bill of 2017, you could pass on your Roth IRA (or the combined Roths of you and your spouse, whichever person died last) to your beneficiaries (grandchildren are best since they will live the longest after you). The assets continue to grow tax free for their lifetime except for a required minimum distribution each year. Since you don't have a RMD on a Roth account, it was almost a perfect estate planning tool. However, the 2017 tax bill changed the rule so that your beneficiary has 10 years of tax free growth (no RMD) and then the inherited Roth ends. The ending balance is tax free, but then any further growth is taxed as a normal investment. Still is a pretty good deal.

For example, I am now 75 and my wife will be 73 this month. Our grandchildren are 9 and almost 6. If we make each other the primary beneficiary of our Roths, then with the first death, the Roth passes to the other spouse tax free and grows tax free until the second spouse dies. The combined Roths then pass to the grandchildren and grow tax free for another 10 years. We have created a trust that will be controlled by our daughter and her husband, so the grandchildren will not have access to the money without the permission of their parents. Let's say that the surviving spouse lives another 15 years (about what the expected lifespan of a 73 y.o. woman is today in the US). Then with an additional ten years after her death, the Roth will grow tax free for 25 years from today. Our grandchildren will be 34 and 31 at that time. If TSLA grows at 10% per year above inflation over the next 25 years, it will grow another 10 times in value, tax free in the Roth.