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

[Dan Detweiler]

If the car is an appreciating asset, it follows the stock price will also be
An appreciating asset.

Here is my issue with the whole "appreciating asset" comment. It sounded to me that Elon was referring to the ability of the car to improve through OTAs. I don't think it was in reference to the Tesla Network. I think people are approaching this the wrong way. Our cars appreciate in their functionality, usability and usefulness. Whether they appreciate in monetary value is reliant on many other factors. Just my interpretation.

Dan

 

[Tenable]

The stock is up 2% because TSLA. :Þ

I'm hoping for (betting small) a bit of a run up into the investor day event. I'll likely sell out before the event happens. I'd love to be surprised. But we have seen "fully autonomous drive demos" from quite a few companies. There was even an obscure company I'd never heard of at CES doing them this year. Even if Tesla were to give out flawless rides around the facility, it seems likely the response will be muted. I believe the market will generally chalk it up to a planned drive and not much more. In order for things to stick they were to unveil something along the lines of amazing functionality and simultaneously announce an immediate roll out. I would have been well served historically selling into these events. Hoping for something magical seems silly now days. But as an owner of the vehicles and for the long term mission I am excited to see the presentation.

 

[Cobbler]

Keeps banging its head on $272...

This feels like it's 2015 again

 

[Tslynk67]

TSLA$ UP to 2% any news like SEC resolution ? Others ?

More the fact that is was over-sold on BS FUD...

 

[mickey6]

Here is my issue with the whole "appreciating asset" comment. It sounded to me that Elon was referring to the ability of the car to improve through OTAs. I don't think it was in reference to the Tesla Network. I think people are approaching this the wrong way. Our cars appreciate in their functionality, usability and usefulness. Whether they appreciate in monetary value is reliant on many other factors. Just my interpretation.

Dan

Maybe he meant "Future-Proof" then. Appreciating asset in my opinion is tied to $$

 

[VValleyEV]

How much of a competitive advantage is this for Tesla in Europe? Sounds huge:

“To take this a step further, the Model 3 and other Teslas will be the only models capable of charging with all three DC fast-charging standards found in Europe—CCS (Combo), CHAdeMO, and Superchargers.”
From quite a while back (any newer/batter info?)
Tesla will soon be compatible with all DC fast charging—in Europe

 

[pnungesser]

Seriously!? You are familiar with S3X, no? Those are castings that hold the motors and gearing and such. Castings, like peanuts, do not grow on trees.

They need to make multiple castings per car at the current run rate of >5k/week...um, lots of machines and space required. Lots.[/QUOT

Yes seriously. There are many things that require castings and machining. I was hoping for a more specific answer from someone. Castings for drive train could best be done at GF1 and avoid having to ship twice. Casting for other things like suspension parts for, example, would only require shipping be done be done once to Fremont. I was looking for what options made sense to be done at Lathrop. The consensus here was that it was a parts warehouse. That's not what Tesla said in their report. As an engineer I did not appreciate your snide comment, and yes, I'm familiar with S3X both as an owner and investor.

 

[Tenable]

If they kick the price of FSD up 5k, cars that already have FSD increase in value 5k(ish).
View attachment 397373

Ok, I am prepared to be flayed for writing this. But regardless of these Elon tweets I'd wager a fair number of shekels that any price increase in the near future is going to be nominal. I've seen people on Tesla Facebook groups call Elons recent methods reminiscent of traditional car salesmanship with a couple going so far as to call it sleazy. I understand the need to pull sales in right now and as an investor I'm glad they are doing what they need to. But we would be naive to think that all of the whipsawing that Tesla is doing right now isn't impacting buyer and owner perceptions of the company and the value proposition of the vehicles.

If they were to significantly increase the price of the software it would have a corresponding decrease in the take rate which is clearly not what Tesla wants or needs right now. The Tesla Fully Autonomous Network is likely nothing more than a pipe dream for the next several years. Even if Tesla can work miracles, they have to get legal approval, that process will not happen overnight.

 

[Rarity]

I think it's pretty clear that as the proportion of a car's value that is in the software increases, the car's value will increasingly follow the software asset value trajectory. Seems like a reasonable proposition. Right now, the value is maybe 20% software/80% hardware at point of sale.

As we have seen with Tesla over the last two years, that software value has increased gradually in fits and starts.

 

[ReflexFunds]

They could definitely be cherry picking routes.
However, my understanding is that the only disengagements that need reported are driver intervention for safety, and system self-disengagements. So balking (won't turn left) wouldn't count anyway ...



If they kick the price of FSD up 5k, cars that already have FSD increase in value 5k(ish).
View attachment 397373

This also increases the price of non FSD upgraded cars by a lesser amount. Tesla will honour the original advertised upgrade price to current owners. The lower price of FSD upgrade has an option value, and this value will increase when the price of FSD on a new car increases.

This can all happen without achieving full autonomy, but would be completely dwarfed by the price appreciation from the cash generation potential of a fully autonomous car.

 

[Drax7]

Here is my issue with the whole "appreciating asset" comment. It sounded to me that Elon was referring to the ability of the car to improve through OTAs. I don't think it was in reference to the Tesla Network. I think people are approaching this the wrong way. Our cars appreciate in their functionality, usability and usefulness. Whether they appreciate in monetary value is reliant on many other factors. Just my interpretation.

Dan

If the car is an appreciating asset, it gives tesla pricing power.
Pricing power means not having to sit around a table holding hands
And Praying.

Wide mass appeal, pricing power, and growth.

 

[sparcs]

If they kick the price of FSD up 5k, cars that already have FSD increase in value 5k(ish).
View attachment 397373

Only if customers are willing to pony up for FSD. I'm interested in a Model Y and there's a zero percent chance I would pay for FSD if it increases in price beyond what it is now.

 

[Rarity]

Only if customers are willing to pony up for FSD.

Or if they choose the 3-year lease and Tesla is able to collect in some fashion on the back end by enabling FSD.

 

[MarcusMaximus]

Here is my issue with the whole "appreciating asset" comment. It sounded to me that Elon was referring to the ability of the car to improve through OTAs. I don't think it was in reference to the Tesla Network. I think people are approaching this the wrong way. Our cars appreciate in their functionality, usability and usefulness. Whether they appreciate in monetary value is reliant on many other factors. Just my interpretation.

Dan

Notably, he retweeted Cathy Wood talking about the $/yr that would be generated by an autonomous taxi Model 3 in response to the appreciating asset comment. Elon seems to have genuinely meant Tesla Network

 

[M|S|W]

How much of a competitive advantage is this for Tesla in Europe? Sounds huge:

“To take this a step further, the Model 3 and other Teslas will be the only models capable of charging with all three DC fast-charging standards found in Europe—CCS (Combo), CHAdeMO, and Superchargers.”
From quite a while back (any newer/batter info?)
Tesla will soon be compatible with all DC fast charging—in Europe

To my knowledge there is no Chademo adapter for Model 3 - only CCS and Tesla Supercharging for DC.

 

[mongo]

Ok, I am prepared to be flayed for writing this. But regardless of these Elon tweets I'd wager a fair number of shekels that any price increase in the near future is going to be nominal. I've seen people on Tesla Facebook groups call Elons recent methods reminiscent of traditional car salesmanship with a couple going so far as to call it sleazy. I understand the need to pull sales in right now and as an investor I'm glad they are doing what they need to. But we would be naive to think that all of the whipsawing that Tesla is doing right now isn't impacting buyer and owner perceptions of the company and the value proposition of the vehicles.

If they were to significantly increase the price of the software it would have a corresponding decrease in the take rate which is clearly not what Tesla wants or needs right now. The Tesla Fully Autonomous Network is likely nothing more than a pipe dream for the next several years. Even if Tesla can work miracles, they have to get legal approval, that process will not happen overnight.

As @ReflexFunds points out, even if the car is not initially purchased with it, if the add on price stays below the new with-purchase price, there is value added.
While higher take rate is better. If the hardware side of AP is stabilized, then expenses are too. If the number of cars sold is increasing, then they can make the same amount (to cover development and profit) with a lower rate rate.

Hopefully, we'll see Monday how the status is.

 

[MarcusMaximus]

Only if customers are willing to pony up for FSD. I'm interested in a Model Y and there's a zero percent chance I would pay for FSD if it increases in price beyond what it is now.

You could always put in a refundable deposit now and lock it in at the current price...

 

[RobStark]

You mean will end 2019 with a .768? or are the years wrong?

Fire Away!

Jan-March 2019 Tesla Market share in the US was .768%

GCBC reports sales-market share, it doesn't predict sales/market share.

With Tesla it estimates what percentage of reported sales were in the US since Tesla refuses to do national/regional breakdowns.

 

[SOULPEDL]

Considering Lidar costs $60k (less maybe now and dropping over time), seems the business models still supported rideshare mania with uber, waymo etc... From that perspective, isn't FSD potentially worth $60K (or the hardware cost difference) in a rideshare model? Otherwise the others would not have attempted self driving ridesharing. IMO $5k is WAY underpriced.

 

[Zhelko Dimic]

not sure if it was posted. but Real Vision have another Tesla Short episode. Basically the guy is betting that demand is gone. And he says reducing sales team is a problem for demand. He will reverse his mind if he will see sustainable demand. Seems reasonable guy though.

This is worth watching if you want to evaluate your risks. You don't have to agree. I don't agree with conclusions, but it's worth knowing your risks if you're person that would take the red pill...
If you are a blue pill type of person, no need to see this video.

To conclude, best bear theses I've ever seen. Actually, more precisely, the only one that wasn't moronic.