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

[Carl Raymond]

I'm going to repeat KarenRei and ask that people who don't understand refrain from speculating on the use of ultracaps.

Much like how you don't use all available power to accelerate a car during normal driving, you won't need max regen capability to slow it down (usually tens of KW's). The efficiency of the regen is in the motor efficiency itself and not the batteries. Capicators won't solve it. In a racetrack environment, then you might have a point, but that's not what you said.

Edit: removed cruft.

So you are saying that motor (generator) efficiency is around 90 percent when transferring electrical energy to the wheels, but only around 50 percent efficient when the wheels transfer energy back to electrical. Why such a big difference?

 

[jpterpsfan]

I am guessing you do not believe Tesla will hit the 7000 run rate this year and not make 400K M3 this year. Actually it looks like you believe Tesla won't even hit 300K this year on the M3. 300K a year is already more on average than you are projecting. Rerun your numbers as if Tesla hits 400K M3s and see where you end up on extra cells. That will be a mix of battery sizes so there will be plenty to build power packs but I don't think they will have as many extras as you think.

Musk said 7k/week by the end of the year. I am assuming they will not have that sort of capacity (at Fremont) until Q3 or Q4. I figured a Q2 70k number was relatively optimistic (considering they have not produced this much yet). Also, my assumption was that they only build the LR (75 kWh) packs. We know they are building a mix of LR and MR (62 kWh) packs for US deliveries. This doesn't even take into consideration the SR (50 kWh packs).

Let's assume they reach 7k/week Model 3 production exclusively producing LR packs (unlikely). 7k/week * 13 weeks * 75 kWh packs = 6.825 GWh. This would be very optimistic, as I highly doubt they would exclusively produce LR packs at this rate (would easily outproduce the level of ongoing demand). Even at 6.825 GWh, that's still an extra 1.175 GWh per quarter. That would be just over 13% of cell output being used for ???

A more likely estimate would probably be a mix of LR and SR battery packs. Let's say it's a 70/30 split (majority to LR). At consistent 7k/week production, that's ~4.78 GWh for LR pack production, and 1.365 GWh for SR pack production. A total of 6.145 GWh pack production per quarter. When we add in the 0.75 GWh of production allocated to Tesla Energy, that would leave 1.855 GWh of cells per quarter excess.

Either S/X are going to use those cells, or Tesla is significantly lowballing their Model 3 production guidance.

 

[KarenRei]

Positive article on SA about Tesla's solid position wrt batteries.

https://seekingalpha.com/article/4237881-heads-tesla-wins

That's... actually a thought-provoking article. On SA of all places!

How would Tesla respond if German automakers came up to Tesla and offered them the cash to build a Gigafactory in Germany, if Tesla agreed to share the output with them? Honestly... I think they'd take them up on the offer.

 

[KarenRei]

Either S/X are going to use those cells

Sigh...

You really think that Tesla just openly lied to analysts on an investor call? You think they're daring the SEC to prosecute them?

Please, come back to reality: there are no plans to switch S/X to 2170s, any time remotely soon. Tesla Energy needs cells. Lots of them.

 

[mrdoubleb]

Meanwhile... the Glovis Captain is about 1 hour out from Zeebrugge, sailing through a busy English Channel.

T-Day is upon us people! My article is written and pre-loaded, just waiting to update it with "the money shot" before it goes live. Hope some brave soul will take a photo at the port as the cars unload.

Oh well, going to bed now and will hunt the endless fields of Reddit, Twitter and various forums in the morning!

 

[humbaba]

Musk said 7k/week by the end of the year. I am assuming they will not have that sort of capacity (at Fremont) until Q3 or Q4. I figured a Q2 70k number was relatively optimistic (considering they have not produced this much yet). Also, my assumption was that they only build the LR (75 kWh) packs. We know they are building a mix of LR and MR (62 kWh) packs for US deliveries. This doesn't even take into consideration the SR (50 kWh packs).

Let's assume they reach 7k/week Model 3 production exclusively producing LR packs (unlikely). 7k/week * 13 weeks * 75 kWh packs = 6.825 GWh. This would be very optimistic, as I highly doubt they would exclusively produce LR packs at this rate (would easily outproduce the level of ongoing demand). Even at 6.825 GWh, that's still an extra 1.175 GWh per quarter. That would be just over 13% of cell output being used for ???

A more likely estimate would probably be a mix of LR and SR battery packs. Let's say it's a 70/30 split (majority to LR). At consistent 7k/week production, that's ~4.78 GWh for LR pack production, and 1.365 GWh for SR pack production. A total of 6.145 GWh pack production per quarter. When we add in the 0.75 GWh of production allocated to Tesla Energy, that would leave 1.855 GWh of cells per quarter excess.

Either S/X are going to use those cells, or Tesla is significantly lowballing their Model 3 production guidance.

So I take it you are a pessimist with respect to Tesla's guidance? It isn't clear why you think it will take Tesla Q3/4 to increase to 7k when they've already demonstrated the ability to achieve at least that, its more a matter of sustaining it. And they also guided for 3k production in Shanghai by end of year which you are omitting.

IOW, unless you don't believe the guidance, it is 10k/wk by end of year, not 7k, with 7k likely before Q3.

 

[Cobos]

That's... actually a thought-provoking article. On SA of all places!

How would Tesla respond if German automakers came up to Tesla and offered them the cash to build a Gigafactory in Germany, if Tesla agreed to share the output with them? Honestly... I think they'd take them up on the offer.

Sorry to push Karen for this, but it just annoys me that people always gets suprised about good articles on Seeking Alpha. They are essentially a blog full of independant posters. Their whole business model is NOT to have any editorial policy. So yes a LOT of shorters like Seeking Alpha since they do not quality check any article and for some wierd reason they have a wide readership. Randy Carlsen always posts good articles and exclusively from a sane perspective. So the question for SA isn't that it's there but the actual author. About 90% of the Tesla articles there are from crazy bonkers short sellers while some like Randy Carlsen are well reasoned and well argumented.
TLDR: So most SA authors are bad some are not.

 

[jpterpsfan]

Sigh...

You really think that Tesla just openly lied to analysts on an investor call? You think they're daring the SEC to prosecute them?

Please, come back to reality: there are no plans to switch S/X to 2170s, any time remotely soon.

Can you dispute my numbers at all? You think they will install 1.5-2 GWh's of Powerpacks/Megapacks per quarter for Supercharger v3 while only 0.75 GWh's per quarter for Tesla Energy? And how would this possibly lower the capital costs of building Superchargers for Tesla? Doing this would make capital costs explode.

 

[Oil4AsphaultOnly]

So you are saying that motor (generator) efficiency is around 90 percent when transferring electrical energy to the wheels, but only around 50 percent efficient when the wheels transfer energy back to electrical. Why such a big difference?

Because you're comparing two different states of operation. The motor is 90 percent efficient during cruising, but not during acceleration. Here's some empirical data for you to munch on: What Learned - Regenerative braking efficiency

And for AC induction motors, you need to also include the energy expended to maintain a magnetic field to run as a generator. So regen mode will NEVER have the same efficiency as power mode.

 

[Oil4AsphaultOnly]

Musk said 7k/week by the end of the year. I am assuming they will not have that sort of capacity (at Fremont) until Q3 or Q4. I figured a Q2 70k number was relatively optimistic (considering they have not produced this much yet). Also, my assumption was that they only build the LR (75 kWh) packs. We know they are building a mix of LR and MR (62 kWh) packs for US deliveries. This doesn't even take into consideration the SR (50 kWh packs).

Let's assume they reach 7k/week Model 3 production exclusively producing LR packs (unlikely). 7k/week * 13 weeks * 75 kWh packs = 6.825 GWh. This would be very optimistic, as I highly doubt they would exclusively produce LR packs at this rate (would easily outproduce the level of ongoing demand). Even at 6.825 GWh, that's still an extra 1.175 GWh per quarter. That would be just over 13% of cell output being used for ???

A more likely estimate would probably be a mix of LR and SR battery packs. Let's say it's a 70/30 split (majority to LR). At consistent 7k/week production, that's ~4.78 GWh for LR pack production, and 1.365 GWh for SR pack production. A total of 6.145 GWh pack production per quarter. When we add in the 0.75 GWh of production allocated to Tesla Energy, that would leave 1.855 GWh of cells per quarter excess.

Either S/X are going to use those cells, or Tesla is significantly lowballing their Model 3 production guidance.

What happened to Tesla Semi? It takes 1MWh of batteries [each] and will be built for internal use initially. The assumption is that's happening this year.

 

[jpterpsfan]

So I take it you are a pessimist with respect to Tesla's guidance? It isn't clear why you think it will take Tesla Q3/4 to increase to 7k when they've already demonstrated the ability to achieve at least that, its more a matter of sustaining it. And they also guided for 3k production in Shanghai by end of year which you are omitting.

IOW, unless you don't believe the guidance, it is 10k/wk by end of year, not 7k, with 7k likely before Q3.

Straight from Tesla's guidance:

Every part of the Model 3 production process has demonstrated over a 24-hour period the ability to produce at an extrapolated rate of 7,000 vehicles per week. By the end of this year, we expect to be able to produce Model 3 at this rate on a sustained basis.

Reading that, why is it unreasonable for me to think it will take them until Q4 to achieve this, but it's reasonable for you to think they will achieve this in Q2? The point of these estimates is to make conservative assumptions. Even when I included the optimistic assumption of production of 7k/week LR packs, I showed that even in that scenario (and 0.75 GWh Tesla Energy production) there is still greater than 1 GWh worth of cell production per quarter.

Also, I'm pretty sure that 10k/week guidance includes 3k/week production from GF3 (Shanghai). Even if they hit this production rate by Q4, why would Panasonic install new lines to reach 35 GWh annual production now? It wouldn't be needed for at least 2 more quarters.

 

[jpterpsfan]

Straight from Tesla's guidance:

Well that was a nice formatting fail.
EDIT: Fixed it in the previous post.

 

[EVNow]

So your calls are 3/15? Not 2/15? Well, you've got good time on those - not too much to worry, unless they're very high strike. I still have some left on 22 Feb (but they're ITM - all my OTMs are out of February now).

My 3/15 calls are 350 and 400s. 400s are losing value fast because of IV. Plan is to roll them to 350. Wanted to roll on Friday, but I dithered.

My 2/15 ones I rolled to 3/15 on 31st.

 

[KarenRei]

Can you dispute my numbers at all? You think they will install 1.5-2 GWh's of Powerpacks/Megapacks per quarter for Supercharger v3 while only 0.75 GWh's per quarter for Tesla Energy? And how would this possibly lower the capital costs of building Superchargers for Tesla? Doing this would make capital costs explode.

First off, let me reiterate: "You really think that Tesla just openly lied to analysts on an investor call? You think they're daring the SEC to prosecute them?"

Secondly - actually, if you want even more things that consume cells than I just listed, sure!

• Scrappage (you think all cells pass QA?)
• Semi
• Shanghai

You also forgot that the capacity doesn't hit 35GWh/year until the start of Q2.

But as for Tesla Energy using a huge number of cells? Yes! That's the whole point. Guidance is 1,1 GWh just for powerpacks and powerwalls, and they talk up the potential for even more. Giving all of the current Supercharger stalls (let alone new ones built in 2019) 200kWh per stall would be 2,4GWh. Even if you want to say only 100kWh per stall and no new Superchargers this year, that'd still be 1,2GWh.

Tesla can make use of every single cell they can get their hands on.

 

[JRP3]

Sorry to push Karen for this, but it just annoys me that people always gets suprised about good articles on Seeking Alpha. They are essentially a blog full of independant posters. Their whole business model is NOT to have any editorial policy.

Except for the fact that good articles from good writers have been outright rejected while garbage articles such as Anton Wahlman claiming new Jeep Grand Wagoneer or something similarly ridiculous is the next Tesla killer. The editors favor anti Tesla articles.

 

[Vitold]

Bummer, bummer. All my whining about cold weather performance for nothing. Thanks for your analysis.

Caps can withstand thermal cycling much better than batteries and their operating temp is between -40-70degC.

 

[Carl Raymond]

Because you're comparing two different states of operation. The motor is 90 percent efficient during cruising, but not during acceleration. Here's some empirical data for you to munch on: What Learned - Regenerative braking efficiency

And for AC induction motors, you need to also include the energy expended to maintain a magnetic field to run as a generator. So regen mode will NEVER have the same efficiency as power mode.

Badly written. e.g. look at the legend for the purple line, it has “Power from/to the battery (Whr)”. Is it energy, wrongly labeled, or power, in some other unit that measures power? Several errors like this.

 

[wipster]

Elon’s G650 is descending for Seattle. I wonder what he’s up to now.

Edit: back on track

View attachment 374459

Maybe he was there to see why it took them so long to build the new Hwy 99 tunnel officially opening today.

Shoulda called Boring!

 

[SPadival]

I think I caught them red handed

S Padival on Twitter

I forgot to add - @ZachShahan please feel free to include this stunning example in the next Pravduh article.

 

[jpterpsfan]

First off, let me reiterate: "You really think that Tesla just openly lied to analysts on an investor call? You think they're daring the SEC to prosecute them?"

Secondly - actually, if you want even more things that consume cells than I just listed, sure!

• Scrappage (you think all cells pass QA?)
• Semi
• Shanghai

You also forgot that the capacity doesn't hit 35GWh/year until the start of Q2.

But as for Tesla Energy using a huge number of cells? Yes! That's the whole point. Guidance is 1,1 GWh just for powerpacks and powerwalls, and they talk up the potential for even more. Giving all of the current Supercharger stalls (let alone new ones built in 2019) 200kWh per stall would be 2,4GWh. Even if you want to say only 100kWh per stall and no new Superchargers this year, that'd still be 1,2GWh.

Tesla can make use of every single cell they can get their hands on.

From the Earnings Call:

Elon Musk
So that's our expectation for Y. For Semi, we're - I don't know if you want to comment on that, Jerome.

Jerome Guillen
I want to start next year as well.

Semi production does not begin until 2020, and that response from Jerome did not sound like a "it will start 2020Q1". If 10% of cells have to be scrapped, then Panasonic does not know what they are doing. And again, Shanghai is down the pipeline, it would be extremely early to setup cell lines for that now. And on the call, Musk said it would probably be a mix of GF1 cells and local Chinese-made cells.

Guidance for Tesla Energy in 2019 was as follows:

A new manufacturing line made by Tesla Grohmann is further increasing production of Powerwall and Powerpack modules at Gigafactory 1. With a better supply of cells and new manufacturing equipment, we are aiming to more than double energy storage deployments to over 2 GWh in 2019.

And on the call, Musk said their internal guidance was for close to 3 GWh, but it would depend on timing of projects. In my calculations, I used the "optimistic" amount to illustrate how much excess capacity they would have even in that scenario. Your assumption is that Tesla Energy production lines "can just be run faster" to handle a capacity 3 times what they are guiding for. I think that's a bit of an unfounded assumption. Like I asked previously, how exactly would incorporating Megapacks (and possibly solar) possibly lower capital costs for Superchargers?