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

[Antares Nebula]

Notice how this article is framing it: as panasonic contradicting the Nikkei report. Needless to say there is a lot of confusion created out of the bad reporting by the Nikkei (no citing of any sources, anonymous or otherwise), where whether your bull or bear, have to admit.

Tesla Shares Fall on Conflicting Reports Over Japanese Battery Production

Tesla Shares Fall on Conflicting Reports Over Japanese Battery Production

 

[SpeedGoat]

welcome troll - nice to see you here reincarnated as a goat

Stating the obvious makes one a troll? Really now... lets try for a moment to be serious.

Tesla is a company that has immense growth ambitions. Indications that those are changing and/or limited in any way should be taken seriously.

If indeed Tesla simply has enough cell production for the foreseeable future then things are fine, but the market's reaction is perfectly logical.

 

[Vitold]

It's undervalued as a growth stock and overvalued as a car company. That's the conundrum for the market right now and partly the reason for the crazy volatility.

Tesla has never been just a car company and never will be (unless car makers become more like Tesla) Tesla even changed their name and it is still confusing to some people...

 

[Fact Checking]

If the return is 4 times higher on cars than PowerWall, it means that the PowerWall is substantially underpriced.

I mean, Tesla puts about ~$10k worth of cell supply into a ~$40k ASP Model 3, on which it gains ~20% margins: $8,000 income generated per unit.

Selling $10k worth of PowerWalls with 20-25% margins will generate $2,000-$2,500 of income.

It's still a very good margin, but my point is that putting cells into a car leverages up the value - so as long as they can Tesla will prefer to put cell into cars, and this is why they reconfigured Tesla Energy cell output last year to feed Model 3 battery packs.

 

[traxila]

[

This is pure wishful thinking/denial and is emblematic of the echo chamber effect of this forum.

TSLA is valued as a growth stock. Any sign that TSLA won't continue to grow at a high rate calls that valuation into question.

A freeze on new investment in both GF1 and GF3 most certainly raises valid questions about Tesla's growth going forward.

We have had official projections of production rates as high as 500k/year by the end of 2019, of which roughly 70% were to come from the US. (7k US, 3k China). Where are the batteries going to come from?

Um, didn’t Panasonic confirm they are already at 35Gwh per year run rate? Which wasn’t supposed to happen until later. This allows for a 400,000 run rate on the 3. The S and X are not using batteries from Gigafactory. So the batteries for half a million cars are there ahead of schedule. But of course, this is a negative...

I guess it will be if they cannot sell the batteries. We will see.

 

[lascavarian]

As i think about battery packs for GF3, packs are already trucked in some transportable form to Fremont from GF1. Shipping to GF3 for any short period of time would simply be trucking the packs to port (for loading) rather than Fremont.

This would raise transportation costs but that increase would be offset by reduced labor costs at GF3. Additionally, for some period of time, there would be the production equipment and 2019 vehicles that need to be shipped so there would be a shared transportation cost/efficiency for a period of time.

If the MXWL technology is more space efficient, at some point the lines at GF1 will give up some space requirements. Could that be starting now. Seems a bit soon with MXWL not quite locked down yet.

 

[anthonyj]

Constant negative news. Gap down every few days. When is Tesla going to come out and prove that demand isn’t slowing? Show SR orders or something, geez.

 

[Artful Dodger]

Constant negative news. Gap down every few days. When is Tesla going to come out and prove that demand isn’t slowing? Show SR orders or something, geez.

Uh, Apr 24?

 

[sundaymorning]

Focusing on aggressively ramping TE seems like the obvious way to go here to try and utilize as much of the cell production as they can. From what Elon said in the Q4 CC I think, TE was cell starved due to model 3 ramp. That does not appear to be the case at all now. He mentioned that this will be the year we see TE take off. Q1 ER will be interesting on that front as we should definitely already see signs of that happening given the availability of cells.

Maybe this is why he visited Buffalo. Maybe he needs to sleep there to get things going.

 

[Carl Raymond]

Old contract terms met. Time for a new contract. Each party seeks the best terms.

Tesla have cell production above immediate requirements. So they use the breathing space to demonstrate that in China they don’t *need* Panasonic.

Panasonic show that merely by mentioning they are *considering* future investment, they can drop TSLA 10 bucks.

OK boys. We can see those muscles. Now shake hands, be friends, and make a deal that splits the gold and provides surety to both sets of stockholders.

Thanks

(sidenote: to *increase* investment, that also must be *considered*)

 

[nursebee]

Cue violins for all of those running for the exits.

Focus on the prize, it is a 10 year plan, not this week plan:

https://ir.tesla.com/news-releases/...ces-new-long-term-performance-award-elon-musk
Elon Musk’s Compensation

 

[ggies07]

After one article, the stock drops and all this chatter. Yeah, there needs to be disclaimers in the heading of every article stating if you've ever driven or been to the factory. The bots need to be trained to recognize the statement as well. This *sugar* is ridiculous.

 

[Fact Checking]

In other news, Audi is now proud to have sold 'four digit' number of E-Tron's in March:

Audi e-tron Sales In March Kicked Off At Four Digit Volume​

which suggests somewhere between 1k-2k, i.e. about a day's worth of Model 3 production ...

Audi spent more than $2.5b on the E-Tron and would have to sell 600,000 units to break even on that:

Tesla Model 3 cost surprised Porsche and Audi after reverse-engineering

"The e-tron as the first electric Audi is not only late. It does not reach some target values and has become far too expensive with more than two billion euros in development costs. The approximately 600,000 cars sold for the break-even are now regarded as an illusion."​

That's the competitive position market leader Tesla is in today.

 

[M|S|W]

Everything makes perfectly sense, because just yesterday TSLA started to climb again....can`t let this happen

 

[shootformoon]

Be careful with this assumption. If the return is 4 times higher on cars than PowerWall, it means that the PowerWall is substantially underpriced. That is, there is an opportunity cost in that is not be appropriately priced. If opportunity costs are appropriately priced, then we should be somewhat indifferent to the specific product mix sold. This is particularly important if grid battery growth really starts to take off.

powerwall is 14kwh and $6700 . It is 75kwh for a long range m3. 75/14*6700 = $35892. I wound not say 4* higher?

 

[Navin]

The drop does help option market makers adjust their positions to account for the earlier earnings announcement. Someone at the nikkei should be getting a flower basket for this gift of a news story

 

[humbaba]

In other news, Audi is now proud to have sold 'four digit' number of E-Tron's in March:

Audi e-tron Sales In March Kicked Off At Four Digit Volume​

which suggests somewhere between 1k-2k, i.e. about a day's worth of Model 3 production ...

Audi spent more than $2.5b on the E-Tron and would have to sell 600,000 units to break even on that:

Tesla Model 3 cost surprised Porsche and Audi after reverse-engineering

"The e-tron as the first electric Audi is not only late. It does not reach some target values and has become far too expensive with more than two billion euros in development costs. The approximately 600,000 cars sold for the break-even are now regarded as an illusion."​

That's the competitive position market leader Tesla is in today.

I don't have the source handy, but Audi said they had targeted 300 cars/day, but due to logistics issues (LG playing hardball negotiation) they were limited to 150 cars/day -- so while that is a couple of days of M3 production it is ~10 days of their production. I'm not sure when they started production, but that suggests that even at half-rate they are producing faster than they can sell.

If they did in fact break even at 600k sales volume then that suggests more than a decade to break even. Even if you go with their target 300/day that is still 6 years to break even. They would have to make and sell cars at a real rate to break even in any reasonable time frame. If their sales already can't keep up with essentially no production that does not bode well.

Regarded as an illusion sounds about right.

 

[Ellec]

"We will of course continue to make new investments in Gigafactory 1, as needed," a Tesla spokesman said in an emailed statement to Bloomberg News on Thursday. "However, we think there is far more output to be gained from improving existing production equipment than was previously estimated."


Tesla Shares Fall on Conflicting Reports Over Japanese Battery Production

 

[elasalle]

OK I added JAN 21 calls in 450 range ...

 

[Krugerrand]

Ok I’m trying not to get overly optimistic about this early quarterly conference call...help me.

Positives:

-Traditionally an early call is bullish.

-It’s right after a positive news event (we know the FSD event will be positive or else they wouldn’t have it). Why schedule bad news right after a positive event and kill momentum when you could instead let the good news soak for several weeks?

-Carsonight has been a good source in the past and says the GF has been humming, inconsistent with reported vehicle production. He says he doesn’t understand the disconnect. I don’t believe the theory that Tesla is stockpiling packs (looks bad on financials/hurts cash availability). So perhaps cells have been going to commercial (Powerpack) and/or retail (Powerwall) storage projects. Consistent with Elon’s “year of Tesla energy” statement at Model Y event. Perhaps also consistent with why the Q4 guidance gave a slow M3 ramp, not indicating 7k/week in Fremont until Q419?

-FCA deal.

-Possible recognition of additional FSD/EAP income (Advanced Summon) plus additional FSD deposits.

-Maxwell news (even if no acquisition, perhaps news that their tech is being incorporated into the GF).

-Wording in P&D report saying “negatively impacted” instead of “negative”.

-If Q1 was obviously not going well and it was evident to the company early, there might have been time/resources to put more focus on the Tesla Energy side to make up for the problems on the auto side.

-Elon’s “stay positive” tweet.

Negatives:

- Known P&D report info, primarily poor X/S deliveries. Modeling auto results using historical Tesla Energy results makes the financials look poor.

-X/S layoffs.

-Downward price adjustments: “DiscountGate”.


Perhaps the Q1 financials don’t look good, but there is so much upcoming good news that Tesla believes this news will overshadow bad quarterly numbers? For example:

-AP3 Hardware in production and very positive progress. Level 4 AP is TRULY and demonstrably in sight.

-Verygreen’s report of “Raven” and “something else” indicating a likely S/X refresh (better performance, longer range, perhaps other changes).


In an attempt to keep a realistic balanced view, who can provide some reasons as to why this report being this early would NOT necessarily be bullish?

Maybe the new CFO in an attempt to impress his boss has rushed through the financials and made some glaring errors? That’d be bad, eh? Unless the mistakes were the kind that make the report worse than reality.

Let me try again.

Maybe because they sold so few vehicles the maths are just that much easier, hence report earlier. Hmmm....despite the distortion field currently surrounding the planet, they still sold a lot of cars with a YOY increase plus a lot of one time charges - nope, maths should be as hard as always.

One last kick at the can.

They have no money left, so nobody would care what the report says; bankrupt.

Did that help?