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

[Carl Raymond]

If the negotiations play out the way I expect there will be some form of monthly reporting by the Tesla oversight committee on what tweets they 'approved' and which ones EM tweeted out on his own. Big whoop

“Dear SEC. Monthly tweet report.

We pre-approved zero percent of tweets by Elon Musk.

We approved of 100 percent of tweets by Elon Musk.

Kind regards,
Tweet report auto sender.
Responses to this address are not monitored.
Please do not reply.”

 

[EVNow]

And we don't know the terms of the contract, which is commercially confidential.

I mean, at one extreme, the contract could say "Tesla agrees to pool its fleet with Fiat Chrysler for 1 year and Fiat Chrysler agrees to pay $300 million." Performance completed.

It could be something more complicated. We don't know.

I hope it is something related to # of EVs delivered in EU. That way, Tesla can recognize the revenue with delivery.

 

[oneday]

Not surprising. It is essentially what the SEC lawyer indicated when asked by the judge what they felt appropriate IF she found Musk in 'contempt'.

IMO, to save face they really need to push this narrative publicly while Musk/his team probably have to stay quiet.

If the negotiations play out the way I expect there will be some form of monthly reporting by the Tesla oversight committee on what tweets they 'approved' and which ones EM tweeted out on his own. Big whoop

I’m glad that the SEC requested for the monthly reports (among increasing fines and other things) during the hearing to the Judge. It gives EM attorneys something to offer that was specifically requested of the Judge and does nothing to impede on Musk and Tesla (minus the time to quickly generate a monthly update). It’s a gimme IMO.

 

[printf42]

OT

Notice the temporal shift here. It's not reasonable because Musk has in fact done a demonstratively bad thing worthy of punishment, but it is "reasonable" because they want to be able to prevent him from doing bad things in the future.

We should all be punished pre-emptively for our future misdeeds!

Are we living in “Minority report” world now? Where is my self-driving Lexus and the alien-dreadnought that’s making them?

 

[Doggydogworld]

"In the initial phase of Gigafactory Shanghai, we expect to have stamping, paint shop, body joining, and general assembly shops in operation by the end of 2019. " - not pack assembly. Packs for this year need to come from GF1. So, yes, the hypothesis that Tesla has incentive to stock up on packs now (within the constraints of a couple hundred million in costs, and storage needs) so as to avoid needing to increase pack production capacity later in the year, is plausible. That doesn't mean that it's right, but it is a plausible hypothesis.

But in the Q4 call Musk said: "And earlier this month, we saw the construction of our Gigafactory in Shanghai, and by the end of this year, we expect to be producing Model 3s using a complete vehicle production line. That's body paint, final assembly, general assembly and module production."

I generally believe company announcements above Muskclaims, but they don't really disagree here. Musk simply provided more detail. I also swear I read that Tesla plans to start seat and motor production in Shanghai in 2020 (not module/pack production), but I can't find that now. EDIT - it was in docs filed in China, they don't seem to mention module/pack assembly.

 

[MarcusMaximus]

I would have guessed at least some incremental production increase in Model 3s for Q1 compared to Q4. I wasn't ever expecting 90k to 100k Model 3s for Q1. Probably many here were expecting in 80k+ territory for Model 3 production in Q1.

Production of Model 3’s did increase slightly in Q1 compared to Q4...

 

[EVNow]

OT :

OT

Sure. But I can point to at least one good electric urban rail line location in practically every city with a population of 500,000 or more. To get to those population levels, you can't be totally sprawly.

To their credit some of these larger cities are building said lines. Others (cough, Columbus Ohio, cough) are not.

Seattle should be easy for mass transit considering how geologically the city is boxed in. Yet I've to literally wait till 2041 for the light rail to come near me. It all comes down to totally wrong priority of the US / state governments.

East Link light rail between Seattle and Redmond halfway done

• Northgate Link Extension in 2021
• Hilltop Tacoma Link Extension in 2022
• East Link in 2023
• Lynnwood Link Extension 2024
• Downtown Redmond Link Extension in 2024
• Federal Way Link Extension in 2024
• Tacoma Dome Link Extension in 2030
• West Seattle and Ballard Link Extensions in 2030 and 2035
• Everett Link Extension in 2036
• TCC Tacoma Link Extension in 2039
• South Kirkland-Issaquah Link in 2041

 

[neroden]

OT

Seattle should be easy for mass transit considering how geologically the city is boxed in. Yet I've to literally wait till 2041 for the light rail to come near me. It all comes down to totally wrong priority of the US / state governments.

Plus NIMBYs. Yes.

I mean, it's insane: a majority of Seattle actually voted for a big subway system in the 1970s ("Forward Thrust"), but due to ludicrous arcane antidemocratic rules, the referendum required 60% support in order to pass, so it "failed" despite majority support. And here we are.

 

[Smokey4141]

@smoky4141
(Tunes thumbs and index fingers again, bad arthritis tho)
Mmmmmm.
Tha wirlds smallest violence,
Playing tha wirlds sadddist songs
In stereo, fur yer listening pleasure.
/s
Seriously, flawed product? Kills people?
Ya tawkin Fossil fuel vehicles or fuel cell vehicles?
Ya not Donn Bailey, just his evile twin skippy
A beeg smooch at cha

Winfield, I'm going to put you on ignore now, because I've come to believe that you are an immature child....
Feel free to continue to shout at the clouds though....

 

[Thekiwi]

Bloomberg TV with “breaking news”

“Tesla laid off DOZENS of sales staff last week’

Wow. Dozens. If only they had already announced that they would be getting rid of some sales staff. Like in some sort of mid quarter announcement many weeks ago.

/S

Can’t believe this absolutely meaningless “news” causes dips on share price.

Oh, wow they are coming back to the story again (the drop can’t have been big enough they have to mention it again 2 minutes later)

Edit: oh look coming back to it for a 3rd time - now with Dana Hull on live for “expert” comment.

 

[Singuy]

I posted this in the near future quarterly financials thread but would like more input about it. I'm curious what others think about likely revenue growth over the next 18 months. This model projects deliveries of 344,000, so a miss on guidance of 360,000+ for 2019.
I think that's a reasonable miss to expect at this point. I have a very difficult time going much higher than these delivery numbers right now. Do others think, based upon the execution we are seeing, that these numbers are overly conservative? I think this illustrates just how amazing Q3 and Q4 2018 were. From a revenue standpoint, they were rather incredible. These numbers at least point to Q4 2019 finally reaching the revenue achieved in Q4 2018. I think it's very unlikely to occur before then. Q1 2020 drops back down below Q4 2018 revenue level due to S/X seasonality and decreasing model 3 ASPs. It's back up above in Q2 2020. This model assumes Tesla reaches a production level of about 7,500 by the end of 2019. Again, this is auto revenue only. Obviously, this involves a lot of guesswork about deliveries and ASP.

Q4 2018
3 production: 61,394 (4,700 per week)
3: 63,150 (ASP $55,800)
S/X: 27,550 (ASP $104,000)
Total: 90,700
Total Auto Revenue: $6,389B

Q1 2019
3 production: 63,000 (4,800 per week)
3: 50,900 (ASP $54,000)
S/X: 12,100 (ASP $102,000)
Total: 63,000
Total Auto Revenue: $3,983B

Q2
3 production: 71,000 (5,500 per week)
3: 61,000 (ASP $52,000)
S/X: 17,000 (ASP $102,000)
Total: 78,000
Total Auto Revenue: $4,906B

Q3
3 production: 83,000 (6,400 per week)
3: 72,000 (ASP $50,000)
S/X: 22,000 (ASP $102,000)
Total: 94,000
Total Auto Revenue: $5,844B

Q4
3 production: 97,000 (7,500 per week)
3: 86,000 (ASP $49,000)
S/X: 23,000 (ASP $102,000)
Total: 109,000
Total Auto Revenue: $6,560B

Q1 2020
3 production: 106,000 (8,100 per week)
3: 95,000 (ASP $47,000)
S/X: 17,000 (ASP $102,000)
Total: 112,000
Total Auto Revenue: $6,199B

Q2 2020
3 production: 118,000 (9,100 per week)
3: 106,000 (ASP $46,000)
S/X: 18,000 (ASP $102,000)
Total: 124,000
Total Auto Revenue: $6,712B

Q3 2020
3: 117,000 (ASP $45,000)
S/X: 22,000 (ASP $102,000)
Total: 139,000
Total Auto Revenue: $7,509B

So based on those numbers, Q2 and Q3 doesn't seem very gaap profitable either unless we have huge ramps in the energy department?

Also seems like Q3 and Q4 will have a hard time having significant YOY growth metrics. Man Q1 S/X numbers were so disappointing. I don't know what kind of miracle Tesla is pulling to have S/X even hit the lower part of the 70k-100k deliveries guide.

 

[KarenRei]

So based on those numbers, Q2 and Q3 doesn't seem very gaap profitable either unless we have huge ramps in the energy department?

Layoffs and store closures will be reducing expenditures, which was kind of the whole point of them.

I don't know what kind of miracle Tesla is pulling to have S/X even hit the lower part of the 70k-100k deliveries guide.

Really?

 

[sparcs]

People who had high production expectations almost always had high delivery expectations to correspond to them. Almost nobody thought it made sense to needlessly create a big gulf between production and deliveries if you can tell you won't be able to deliver everything.

Should we set our Q2 expectations lower then? 65k Model 3s produced for Q2?

The logistical issues still remain as they have a lot of European and Chinese deliveries remaining. There's a standard range ramp that Elon has talked about that may affect Q2 production.

 

[durkie]

And we don't know the terms of the contract, which is commercially confidential.

I mean, at one extreme, the contract could say "Tesla agrees to pool its fleet with Fiat Chrysler for 1 year and Fiat Chrysler agrees to pay $300 million." Performance completed.

It could be something more complicated. We don't know.

Is this going to remain a mystery for beyond the Q1 reports of both of these companies? Sure we might not know the exact terms, but it seems like we'll know the effective terms. FCA can't just hide how much they're paying right?

 

[KarenRei]

Should we set our Q2 expectations lower then? 65k Model 3s produced for Q2?

The logistical issues still remain as they have a lot of European and Chinese deliveries remaining. There's a standard range ramp that Elon has talked about that may affect Q2 production.

Even if Tesla doesn't get any better at shipping overseas - which they already did as the quarter progressed - there won't be the new in-transit inventory buildup that occurred this quarter, unless they do another major geographic expansion. Europe and China are continuing to deliver right now from what was previously sent but not yet delivered. Unlike Q1, they should start and end with similar inventory, if not less at the end of Q2 (I actually strongly suspect less)

 

[KarenRei]

Is this going to remain a mystery for beyond the Q1 reports of both of these companies? Sure we might not know the exact terms, but it seems like we'll know the effective terms. FCA can't just hide how much they're paying right?

We have no clue. It could all be frontloaded in Q1 for all we know. Or not occur until 2021.

 

[Singuy]

Layoffs and store closures will be reducing expenditures, which was kind of the whole point of them.



Really?

Karen we all had a lot of crow eating lately so lets not be too optimistic.

The S/X deliveries had a 1/4 ratio to the model 3 and the S/X has the advantage of being available in far more places than the 3 this quarter. So I don't know why we don't expect to see the same ratio moving forward (or maybe worst when SR+ is more readily available). I'm less worried about the X than the S. Tesla needs to put the new batteries and drive train into these cars ASAP. The price difference between a 3 and a S currently is not worth it according to the market giving us these ratios. We are already seeing that the 3 is getting more/better features than the S/X(such as v3 charging) and that's a big deal for buyers. I wish it's the other way around so it can bring some balance to the force.

 

[KarenRei]

Karen we all had a lot of crow eating lately so lets not be too optimistic.

That's not a crow. That's a raven. Hint, hint.

 

[Duffer]

@KarenRei I was expecting a Edgar Alan Poe reverence, but the picture works.

Reuters: SEC steps on Tesla 'reasonable' to prevent problems: commissioner

WASHINGTON (Reuters) - The U.S. securities watchdog’s request that a federal judge hold Tesla Inc Chief Executive Elon Musk in contempt over the billionaire entrepreneur’s use of Twitter was “reasonable,” said a U.S. Securities and Exchange Commission official on Monday.

SEC Commissioner Robert Jackson, a Democrat, told reporters at a conference in Washington that the SEC was reasonable in suggesting greater oversight of Musk’s communications, including the threat of new fines if he backslides.

Contrary to some members thoughts, Tesla will not be out of the crosshairs in 2020 if/when Trump is replaced. There are currently 18 Democrats in the race currently. Presidential campaigns are very expensive and there are millions of Petro dollars available to "help".

Notice the temporal shift here. It's not reasonable because Musk has in fact done a demonstratively bad thing worthy of punishment, but it is "reasonable" because they want to be able to prevent him from doing bad things in the future.



We should all be punished pre-emptively for our future misdeeds!

Of course. Now turn yourself in at the closest retraining center for doubting your master's... err government's benevolent actions.

 

[KarenRei]

For anyone who's not understanding the "Raven" reference:

Tesla, TSLA & the Investment World: the 2019 Investors' Roundtable
Tesla, TSLA & the Investment World: the 2019 Investors' Roundtable

As a completely unrelated side topic, something just occurred to me. GM just hit their tax credit cliff - but said that they have no plans to compensate for it with a drop in price on the Bolt. They moved 4,316 Bolts this quarter. I'm sure that number is going to drop heavily next quarter. I wonder if that might shift another thousand or so sales Tesla's way in the US...