Look at all those "cranes" at work.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
RobStark
Well-Known Member
Instead of free Roadster after 50 referrals they can go back to the old way where the top referral salesperson in each region gets a Roadster.
1 for North America
1 for Europe
1 for Asia.
This has worked so well I would do it If I was the VP of marketing at Rivian.
Give all the top Tesla youtubbers with over 50k subscribers and all the general interest youtubbers with over 500k subscribers that do Tesla vids every once in a while a referral code for Rivian RIT AND RIS reservations earning discounts and a free vehicle upon ~300 deliveries.
RobStark
Well-Known Member
A person who's income stream from making professional or semi professional videos posted on Youtube is their primary income source or at least a significant income source.
I for one as an owner am sad to see the referral program go away... because I never got a single one (rather, never really had the opportunity arise to give anyone my referral code - the only person who I know with the capacity to buy one had ordered before regular Model 3s were able to participate) and I wanted that swanky signature black wall charger.
As an investor, meh. I am surprised it will make that much of a difference, and they could have adjusted the rewards to keep things in check, but ditching it probably is for the best as there is likely a fair amount of overhead managing it.
As an investor, meh. I am surprised it will make that much of a difference, and they could have adjusted the rewards to keep things in check, but ditching it probably is for the best as there is likely a fair amount of overhead managing it.
McMountain
Member
Look at all those "cranes" at work.
The "cranes" are probably rigs doing ground improvement for the foundations.
Fact Checking
Well-Known Member
There was also the easy potential for abuse - and does Tesla really want to spend the time policing referrals to make sure they are not spammed and checking sales employees? Removing the monetary temptation is a good way to fight abuse.
Also note the peak cost: above 5 referrals the reward was a 2% discount to a Roadster 2, which becomes a free Roadster 2 at 50 referrals. That's a ~$4,000 cost per referral just for the bonus (!) - the free Supercharging side gets added too. With a $55k Model 3 ASP every such referral reduced margins by 7% (!), which for the $35k version would increase to a margin reduction of 11%. Those were not sustainable referral rewards.
Also, while I still think the referral program was a big plus to Tesla's organic growth of demand via no mass advertising whatsoever, many of the latest rewards probably went out to those abusing the system to the fullest extent ...
BTW., the referral program is ending on February 1, and the 53rd Super Bowl is on February 3. Coincidence?
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Nope. Smoke and mirrors. Potemkin factory. All fake. LA LA LA I CAN'T HEAR YOU!!!!
</TSLAQ>
(Must be weird being a short and spending your days searching for hay in a needlestack...
)
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I questioned the objectivity of S&P500's evaluation of TSLA after having watched exactly that clip - in fact that whole film is filled with credible and disturbing allegations regarding the US financial markets.
'The Big Short' was definitely worth my time.
Fact Checking
Well-Known Member
Arguably S&P index inclusion has not been politicized or corrupted before AFAIK, and I don't see the S&P starting with that for the sake of Tesla, who is really a small player in the trillions of dollars of index fund flows.
S&P and other ratings agency credit ratings on the other hand was and continues to be a big source of revenue, and with the 'bond issuer pays the credit rating agency' business model there's an obvious conflict of interest that's not addressed even today.
That conflict of interest does not exist, or is at minimum much, much weaker for the rather mechanic act of S&P 500 inclusion.
So I hope it's going to be mechanic inclusion in ~June.
While it's an exciting movie, I found it kind of disturbing that the protagonist set out to earn a billion dollars from the potential collapse of civilization as we know it. They didn't warn anyone or work towards a solution in reality - they mostly hid all that information they uncovered to try to profit from it privately.
I.e. the usual Hollywood script of "hero sees end of the world and saves it" has changed into "hero sees end of the world and hopes it happens so that he can profit from it financially" script.
While I realize that this is how half of Wall Street is earning money, it's rather obscene if we look at the big picture...
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Buckminster
Well-Known Member
For me the picture looks something like this:
1) Model Y unveiled ~15th March - likelihood 75%
Likelihood that this goes viral on a different scale to M3 and sells all other Teslas - 75%
2) Major refresh to S/X at the same event - likelihood 60%
Likelihood of a 2170 120D acting as a major sales lightning rod - 60%
3) Model 3 SR available from the same event with better than advertised specs - likelihood 50%
Likelihood that Tesla can't build enough during 2019 and going well into 2020 - 100% (without referrals)
4) Pickup unveiled at same event - 20%
You get the picture...
5) FSD / HW3 updates - 60%
6) Roadster / Semi updates - 40%
7) Solar roof / energy updates - 40%
8) SpaceX updates - 10%
The Model Y unveil event could be on a different level if Elon decides to:
Elon has become quite grown up on Twitter - absolutely agree that he is preparing to unleash the hounds! He will want to express himself in a whole new way. Enter "The King" (Appeals to my British sense of identity...) A leader that will finally start getting on top of world issues - starting with the Climate.
Fact Checking
Well-Known Member
So March unveil is too late I think: I don't think Tesla can get through Q1 unscathed with the 75D options removed.
So I think there's going to be at least two big announcements:
- Something for S/X in the February time frame (in time to help Q1 materially which ends on March 31),
- the Model Y unveil in March,
- possibly Model 3 announcements as well.
The ending of the referral program on February 1 can be read both in a bullish and in a bearish fashion. Main bearish themes is going to be:
Main bullish themes:
- Model 3 margins are collapsing!
- Something something fraud, something something SEC, something something Enron, buy January 18 PUTs!
- Tesla wants to generate as much cash for growth capex as possible
- There's some huge product announcements coming they are certain will generate enough new orders.
My guess is on February 1st we will see:
- Launch of new upgraded Long Range (90/100 KWh) and Very Long Range (120/130 Kwh) S&X options. I am leaning increasingly towards expectation of a move to 2170 GF1 cells, particularly with some suggestions Fremont has been largely closed this week (which could be for significant rework of the S&X body lines).
- Order configuration opening for the $40k standard range premium interior Model 3 in the US. This may correspond to deliveries starting in March.
- Possibly also Long Range (non AWD) and Mid Range Model 3 order options in Europe and Asia.
IMHO, the most likely thing coming for S/X is a price drop. But they won't want to do that (or any alternative possibilities) too close to the date of termination of the 75D models, so as not to make buyers feel screwed over.
Tesla does not need to have "Q1 unscathed" re: S/X. They just need to max out their production capacity annually, as always, and make up for any quarterly revenue drops that might occur with revenue growth in Model 3s (and potentially Tesla Energy)
As for the price drop: remember, there's only about $4k worth of extra cells in a 100D vs. a 75D. Margins on 75D had to have been tiny and margins on the 100D large in order to average ~25-30%. Now they can transform the 100Ds to lower margin vehicles, with the P100Ds as the higher margin upgrade, and recenter at ~25-30% margin with a far lower sales price for the 100Ds.
If they don't do that, then their S/X margins are going to be crazy high.
Tesla does not need to have "Q1 unscathed" re: S/X. They just need to max out their production capacity annually, as always, and make up for any quarterly revenue drops that might occur with revenue growth in Model 3s (and potentially Tesla Energy)
As for the price drop: remember, there's only about $4k worth of extra cells in a 100D vs. a 75D. Margins on 75D had to have been tiny and margins on the 100D large in order to average ~25-30%. Now they can transform the 100Ds to lower margin vehicles, with the P100Ds as the higher margin upgrade, and recenter at ~25-30% margin with a far lower sales price for the 100Ds.
If they don't do that, then their S/X margins are going to be crazy high.
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RobStark
Well-Known Member
Same vehicle. Same production lines. Same labour per vehicle.
I guess you're positing a drop from 100k/yr sales increasing production hardware depreciation per vehicle. Such a drop is certainly possible, although there's many ways to counter it (in addition to lowering the price), including one that happens automatically: the global EV market grows by leaps and bounds every year. Maintaining sales at a constant level means selling to an increasingly small percent of global EV buyers.
That said, IMHO, the most likely thing we'll see is price drops (probably not all at once) and a recentering of margins back to where they were.
The second most likely thing we'll see is an interior refresh, but probably not Q1.
The third most likely thing we'll see is a drive unit swap over to the Model 3 drive unit, for one of the motors (aka longer range, faster charging (mph/kph), greater longevity (fewer cell cycles per mi/km), greater sustained track performance, etc, without changing anything "structural" in the vehicle, and drive units are far cheaper than battery packs and the Model 3 drive unit's production process is probably the smoothest running, most automated thing that Tesla does.
The least likely thing we'll see, IMHO, is a switch to 2170s any time soon. The last thing Tesla needs is to needlessly burn 10GWh/yr of their much-needed 2170 production (which Panasonic always seems to lag on making more of), free up their excellent 18650 cells for competitors to buy (or reengineer their other product lines to use them), add an entirely new pack production line (since the pack wouldn't be the same as either the 3's or the current S/X's), reengineer the vehicle (including its production lines) and requalify it (battery packs are structural elements, you can't just arbitrarily change them.. also lots of safety issues to requalify), and dozens of other things.
I could be wrong, but this is how I see things.
We may also get some chemistry upgrades at any arbitrary point in time. These apply to both 18650s and 2170s. People often seem to confuse formats with chemistries around here. Unfortunately, once people get in their heads that 2170 = "Future!" and 18650 = "Past!", it's hard to get people to accept that S/X might be using 18650s for quite some time.
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Fact Checking
Well-Known Member
So if they switch to 2170 cells then economies of scale will change, and rather radically so.
I don't disagree with your prediction that they are going to drop the 100D price - I just think they might do it with a new 2170 battery pack (naming it 'Long Range') and a higher priced 'Very Long Range' and 'Performance' version with a 110 kWh battery pack and 2.2sec acceleration figures or so.
But perhaps that's too big of a step.
Yeah, the economies will switch... to a huge negative on their balance sheet as they work to pay off the capital investments involved in such a change. Not to mention all of the "dragging engineers off of working on Tesla's more pressing projects" aspect.
Tesla will not switch to 2170s until they have to. Their capital needs are far more pressing. Wasn't the topic du jour recently how Tesla needs to vastly increase the number of service centres? That's just one of over a dozen much more pressing capital needs. March convertibles. GF3. GF4. GF2. Model Y tooling. Semi tooling. Pickup. Roadster. Next-gen mass market sedan. Market expansion. R&D. Supercharger expansion. Supercharger V3. Megacharger development. Megacharger network. On and on and on.
This isn't Apple. They're not flush with a war chest of cash that they can just throw at whatever project they want.
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Staff costs are mostly fixed, so lower volume = significantly higher staff costs per vehicle (this is why a 90% increase in Model 3 production volume QoQ in Q3 only needed c.30% higher employee hours). Lower volume also means less purchasing scale which means higher raw material and supplier costs. With lower production employees just process less vehicles per hour.
At some production level Tesla could cut S/X shifts from 2 to 1 (they already cut from 3 to 2 in 2017), but volume would have to fall very significantly for that to be possible.
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