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

[Navin]

Same ol two step. How does this jackass still move the market

https://ftalphaville.ft.com/2018/09/18/1537277135000/Tesla-needs-cash--says-Morgan-Stanley/

 

[humbaba]

Same ol two step. How does this jackass still move the market

https://ftalphaville.ft.com/2018/09/18/1537277135000/Tesla-needs-cash--says-Morgan-Stanley/

Is there some new news, or just this >6 months old article?

 

[Krugerrand]

*sigh*. Ok. You win

 

[Lessmog]

Based on the attached EU chart from the tweet, it looks like FCA is also partnering with Tesla in the US, possibly for CARB ZEV credits. There's another large pile of cash right there, since it includes Dodge brand minivans.

View attachment 394577

Could that be for US-made vehicles sold in the EU? Are there any?

Don't know where it is made, but I have seen many Fiat Freemont SUVs both here and even more in Italy.

 

[sparcs]

Tesla price target lowered to $400 from $450 at Jefferies

Jefferies analyst Philippe Houchois lowered his price target for Tesla (TSLA) to $400 from $450 following the Q1 miss in mix and delivered units. While Q1 disappointed, the "critical tests" remain demand elasticity in Q2 as lower priced Model 3 versions become available and sorting out logistics, Houchois tells investors in a research note. Further, the announcement of an "Open Pool" with Fiat Chrysler (FCAU) to reduce calculated CO2 emissions in Europe could generate several million of cash income, possibly starting this year, says the analyst. Nonetheless, he lowered his fiscal year estimates for Tesla by 6% in volume to 374,000 units, revenue by 8% to $27B, GAAP operating income by 36% to $409M and free cash flow by 16% to $560M. Houchois keeps a Buy rating on Tesla.

 

[Krugerrand]

Fred Alert:

Tesla fired most employees in a service center for being ‘inappropriate’



Womp womp.

Good on Tesla.

If only the dramatic amongst us could have waited the less than 12 hours before getting dramatic about how terrible, awful, backwards, end of the world, OMG!!!! There isn’t going to be service coverage!, Tesla is stooooopid, etc....

If only a little more self control. If only a little patience. If only not jumping to conclusions. If only not thinking the worse.

If only. The world would be a better, more positive, less dramatic world.

If only we could learn from this lesson. But alas.

 

[mongo]

If only the dramatic amongst us could have waited the less than 12 hours before getting dramatic about how terrible, awful, backwards, end of the world, OMG!!!! There isn’t going to be service coverage!, Tesla is stooooopid, etc....

If only a little more self control. If only a little patience. If only not jumping to conclusions. If only not thinking the worse.

If only. The world would be a better, more positive, less dramatic world.

If only we could learn from this lesson. But alas.

I'll check back with you tonight

 

[ggr]

Mod: wish granted. --ggr.

As moderator, I should remember not to mix roles. I have removed the temporary ban on @Smokey4141 so that he can rebut my rebuttal. Or try to anyway.

Edit: wow, so many disagrees! Tells me something...

 

[Chocochip]

Lex Fridman on Twitter
MIT HCAI Autopilot study paper is out.
Elon also retweeted.


Here is the full paper PDF if you have problem opening the summary page:
https://hcai.mit.edu/tesla-autopilot-human-side.pdf

Not sure if anyone else discussed this (I did a quick search and couldn't find anything); I read the paper and here are the main takeaways:

• this is a study on the vigilance of drivers when supervising the Autopilot system, NOT a study on how safe Autopilot is - it may be an indirect indicator of Autopilot safety via the level of vigilance it exacts from the driver
• previous literature points to a drop in vigilance with time (measured as missed/non-detected errors, or delayed reaction to such) when supervising an autonomous system (typically in a simulation)
• by contrast, in this study the authors noticed a consistently high level of vigilance when operating Autopilot; they assign this different outcome to two factors:

1. the expectation and anticipation of failure of the system from the operators (drivers) in certain situations and road environments, due to it being far from perfect - in other words, expecting things to go wrong makes drivers pay more attention; and
2. what the authors call "functional vigilance", meaning that the drivers can, on top of supervising the system, also disable and enable it at will, which leads to shorter autonomous driving intervals, which can be more easily supervised

• there are also certain patterns in which drivers choose to employ Autopilot, mainly high-speed road sections with free-flowing traffic (highways)
• there were no accidents recorded during the study, either caused by a poor Autopilot decision or by slow reaction of the drivers in dangerous situations
• most situations in which drivers chose to disengage Autopilot in an anticipatory manner involved curves in the road, while most situations for reactive disengagements involved the car getting to close to lane lines, walls or other cars
• interestingly, drivers in the study tended to constantly explore the limits of the system, which allowed them to better understand its limitations (where things are likely to not work or go wrong)
• there is also an acknowledgement by the authors that, statistically, there will be a number of individuals in the greater population that will tend to over-rely on the performance of the autonomous system and show decreased vigilance, although they didn't see this behaviour in the studied group

Paradoxically, the authors suggest that the imperfect functionality of the Autopilot system is what keeps vigilance levels high for drivers and helps avoid serious consequences; a closer-to-perfect system may actually increase complacency and prove itself more dangerous when supervision is still necessary. Moreover, being constantly exposed to a close-to-perfect autonomous driving system for an extended time interval may cause a drop in driving abilities and a lowered capacity to "take over" when things go wrong.

The suggestion made is that the ideal autonomous driving system is not one that is 99.99% perfect, but one that is imperfect but can effectively notify the operator of its imperfections.

 

[humbaba]

From the "Truth in Filing Department":

These villains really did register as Washington lobbyists

 

[Fact Checking]

The crowd-sourced, social media swarm that is betting Tesla will crash and burn

Let's again remember that the LA Times is owned by a direct competitor of Tesla, which is developing zinc-air battery technology:

Wondering whether this is related:

Patrick Soon-Shiong - Wikipedia

In February 2018, the Los Angeles Times reported that Soon-Shiong's investment firm Nant Capital reached a deal to purchase the paper and The San Diego Union-Tribune from Tronc Inc. for "nearly $500 million in cash"​

And:

"In September 2018, his company NantEnergy announced the development of a zinc air battery with a projected cost of $100 per kilowatt-hour (less than one-third the cost of lithium-ion batteries)."​

I.e. the LA Times' current owner has a company that is developing battery technology that competes with Tesla's battery technology.

So the LA Times is attacking a direct competitor of the owner of the paper.

The only surprising thing about this is that the LA Times writing hit pieces about the owner's competition does not count as market manipulation aiding and abetting an illegal 'short and distort' scheme in the SEC's book.

 

[humbaba]

As moderator, I should remember not to mix roles. I have removed the temporary ban on @Smokey4141 so that he can rebut my rebuttal. Or try to anyway.

Always better to take the high road. But is that some turkey jerky you're chewin' on?

 

[bdy0627]

If you're looking for dispute that Model 3 osbournes S, you're not going to find it from me. I've been amazed that it took this long for it to happen. And now, S and X are osbourning S and X, since almost everyone seems to think a refresh is imminent.



So you think Tesla should have, instead of producing 77k vehicles and delivering 63k, they should have instead produced 90-100k and delivered 63k, and thus tacked another 1B loss to FCF? Great plan there.



With SR in the mix in the US (which IMHO was clearly demand limited in Jan + Feb, due to the front-loading effect of the tax credit cliff, and seasonal low volumes; it's hard to say whether March was more limited by demand or deliveries), now you have the SR osbourning higher-end 3s. You have to reduce their price to continue to sell them, and it's important because their margins are so good (even price-reduced). Global S+X price reductions, again, you're not going to get any dispute from me that S+X has been osbourned and needs stimulus - although the real stimulus they need is not a "buy our car!" ad, it's a refresh so it can regain the crown of "the latest tech".

Until then, the proper solution is to eliminate the low-margin S+X variants - which made up the lion's share of sales - to "downsell" buyers to the higher-end 3 variants, which make more profit, and have all remaining S+X sales have higher margins. Remember, it's not about raw volume - it's about how much you earn.

Yes! Totally agree with all of this.

 

[Krugerrand]

I've got say though, the numbers are a nice reality check for many people here.
I remember when a while ago I was talking about how Tesla needs to be prepared in case there's a recession to have enough cash and have a healthy P&L.
And people here completely brushed me off saying that Tesla are SO in demand that even if there's a full blown recession, Tesla will still sell more and more and so they should only focus on growth and forget about income etc.
And here we are in a slowing but still growing economy with Tesla selling under expectations...
______

Actually, Tesla has positioned itself in preparation for a recession. They’ll be just fine. Others. Not so much.

 

[Drax7]

We are oversold, though first quarter numbers are ugly and that may limit
A bounce let alone a sustained rally.

When can we look beyond the valley, is there any indication demand
Will resume for all 3 models. We need some delivery evidence to resume
A sustained upward trend.

 

[aubreymcfato]

The crowd-sourced, social media swarm that is betting Tesla will crash and burn

A positive article about TSLAQ. They are really scraping the barrel, but, alas, this will progress the anti-Tesla narrative.

 

[Smokey4141]

homophobic jokes about federal judges = "can rub some people the wrong way"

This tells as much about Mark as it does about you.

What's next - Roger Stone type "joke" about judges ? Mark & Roger Stone I'm sure share a lot of political ideology.

It would be more accurate to say:

homophobic jokes about federal judges = "and Mark makes some bad (and cringe-worthy) jokes...."

Certainly cringe-worthy, and not something I would have said...

But thank you for making an incorrect assumption about me... Tells me much about you, right?

 

[WarpedOne]

My ignore list just got a bit less incomplete ...

 

[jhm]

The crowd-sourced, social media swarm that is betting Tesla will crash and burn

Hmm, I got to wonder if these shorts are so good at sniffing out fraud, why haven't they been shorting and exposing all these automakers colluding on emissions fraud and more? You'd think shorts could basically do some emissions testing of their own to determine who's cheating and then target the cheaters.

Instead $tslaq is a doomsday cult fixated on a single target. You can see in this reporting how members have gone through a sort of conversion experience as they bond with the $tslaq community. They become indoctrinated into seeing Musk as a liar who cannot be trusted as as source of information about Tesla. This creates an intellectual filter where any information contrary to the view of the cult is rejected as an obvious deception by Musk. Also to reinforce this script, their is cultivation of a persecution complex. As long as Musk and Tesla acolytes are seen as persecuting the $tslaq truth speaker, it validates the cults view and radically rejects any information contrary to that view. The cult member feels himself fighting a righteous cause simply by hating and contradicting any who are "persecuting" the cult. The fixation on Tesla's in parking lots reveals this sort of distortive framing. Consider that the average dealership sells only about 10 cars per week, but they've got scores even hundreds of cars on their lots at any point in time. This is just a logistical reality. There is nothing nefarious about that. Now look at the Tesla delivery lot, they are stuffed to the gills just to handle the logistics of delivery. Naturally there needs to be some overflow. Now because the $tslaq cult has framed this all as some great deception, they are predisposed to interpret the observations of Tesla in lots as some sort of deception, rather than simply the logistics of a company that is bursting at the seems more than doubling their deliveries in a single year. The cannot take in such an alternative interpretation because they perceive that they are actively being lied to and personally threatened by Tesla. Growth and logistics, those are exactly the sort of lies they would expect a fraudster like Musk to try to deceive them with!

Philosophically this is why falsifuability criterion of Karl Popper is so important for delineating between empirical though and cultic thinking. The question is, what sort of empirical data would a $tslaq member accept as falsifying or invalidating his investment thesis? The intellectual filters of the cultic mind make it nearly impossible for anything to register as fact that should threaten the cultic view. So we see this over and over again, some information comes out that is consistent with a Tesla grow narrative, and the doomsday cult quickly radically reinterprets as some sort of bad thing or further evidence of fraud or doom. The basic facts that Tesla grew unit sales by 150% last year and finished the second half profitable and cash positive does not register in their think as facts which potentially invalidates their short thesis. Instead they become obsessed with snooping around parking lots hoping to find evidence to buttress their rejection of facts about growth. So many of them do not hold a short thesis that can reasonably be falsified by basic facts. And this is precisely what it means to be caught up in a cultic thinking as a radical departure from empirical thought.

Yes, $TslaQ is a cult.

One should also ask themselves what empirical outcome would cause me to reject my current investment thesis. For me personally, I am looking to see 50% annual growth in revenue through 2025. If Tesla were to struggle to sustain this level of growth, I would become very concerned. As a really basic empirical test, I check to see if y/y reported revenue has actually grown more than 50%. Moreover, I question whether this growth can be sustained over the next year or two. So I need to see that Tesla is continuing to position itself for growth. This outlook is quite open to information which can falsify my thesis. So to the best of my abilities, I am engaged in empirical thinking and not lost in cultic brain rot.

 

[Smokey4141]

That analysis is worth a read, tempered by the fact that every single one of that dude's threads supports the short thesis. That crew would be way more credible if anyone could ever recognize that Elon and Tesla have achieved some pretty amazing things. Those folks have left such a years-long trail of being mostly wrong in their wake. It'd make them way more credible if they weren't such strident ideologues.

Some (including me, today) have criticized this place for being cult-like. TSLAQ drinks nothing but KoolAid.

To be fair, Fly is in Europe, and tracked deliveries in that area on practically a daily basis...
NO ONE on the "Q" side of the ledger was ~surprised~ by the disappointing Q1 sales....
Yet many ~here~ were...
So, drink whatever flavor Kool-aid you want, but on the "Q" side, it tasted pretty good...
(that wasn't meant specifically to you, Creekstalker, but more the collective board here)

And yes, many have been wrong about some things at some times, but there's been a lot right too....
And many times see things before they are common knowledge....
And some have been pounding that drum for years, others have come along more recently...
To lump ~all~ TSLA bears into one single camp.....is just simply wrong...

This might be an interesting thread along those lines as well... Never mess with the "el gato"... hahahaha
el gato malo on Twitter


I'll wrap this up with...... Achieved some pretty amazing things, yes....
But at what cost?

Rhetorical question, no need to answer, but....when the books and movie comes out a few years from now.....please....think of this note...

Regardless, thanks, man... Always appreciate honest, thoughtful debate among reasonable adults....