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

[ZachShahan]

Zach - loving your articles. Three ideas for future articles that may spark interest:

1) Is Elon looking to change the home building industry next?
Legwork. Aircon.

2) Elon's Tsunami inbound
Legwork. Peeps need reminding just how many world changing products Elon has coming. If you accept, good luck keeping it readable. Maybe split into multiple articles by year or company.

3) The economics (and charging practicality) of driving a Model 3 for Uber
Could be a game changer if you can find the data / sources. Maybe you initially write an article asking for Uber/Lyft drivers to write to you with their accounts.

Thanks. Will put on story list & tag some writers.

 

[stef]

Less than 100km from where I live. Apparently a Dutch Model S of less than a year old, and a supercharger that is also one of the newest in Belgium.
Normally, I’d expect an avalanche of comments (on the original HLN article) like ‘those Teslas should be banned because they catch fire all the time’, but no comments at all for the moment. Also, the article is very factual and doesn’t refer to any other EV fires. Maybe we’ve reached the tipping point where the other car manufacturers can’t push the EV FUD anymore because they want to sell their own EVs.
If there’s any more local news about this fire, I’ll try to summarize it here.

Its Sunday. Expecting comments and media to pick this up 30 minutes before US market open tomorrow.

 

[LN1_Casey]

What Do We Know About Tesla Owners? | CleanTechnica

The Hedges Company has also released some fascinating stats on Tesla owners. [...]

• The Model X has a higher percentage of women owners. Women own 29% of Model X vehicles, and men own 71%. The Tesla Model S, a 4-door sedan, tends to have more male ownership than the Model X. Males own 77% of Model S vehicles, and women own 23%. Women only own 16% of Model 3’s, men own 84%.

I wonder if the higher percentage of women owners contributes at all to the over all lower median income of the model X owners vs the model S, when the X is a higher priced vehicle.

 

[ZachShahan]

I lament the fact that FUD and combating FUD has come to as prominent place as it has on this thread. But it unfortunately does seem to have become relevant at this point to an investors roundtable. I try to avoid stepping into the debate online because of its often polarized and vitriolic nature, but I read an article today that I just could not let pass without posting a response.

Here's the article, in case others wish to respond.
Why Bloom is Off Environmental Rose for Tesla and Other Electric Vehicles

it's not all that hard to find my response (it's the really long one), but I can't seem to find a way to link directly to it, so am including below. (Now would be a good time to skip to the next post if you don't want to read something that's long). And while you'll see that I'm not an unadulterated fan of Elon or the Paris Agreement, I think it does its own small part to balance the one-sided narrative.

- - - - -
I come to the Daily Signal because it serves as a voice of reason. But it has badly, and sadly, failed here. At its best, the Daily Signal is an antidote to news that begins with an ideological premise and then gathers up an appropriate collection of "facts" to reach a pre-ordained, foregone conclusion. This article, however, serves as a cautionary tale that even the best intentioned efforts can still fall into the very rhetorical trap which it seeks to counter.

Anyone that has read my writings knows my libertarian, traditional virtues orientation. As well as my disdain for using climate change (whatever the nuances of the scientific data and models) as a trojan horse for big government intervention. But I drive a Tesla Model 3, and it is not because I am one of those "Tesla owners [who] sip their lattes at the Supercharger" or a "wealthy environmentalist." I don't even drink coffee, and a quick glance at my bank account woud disabuse anyone of the notion that I am wealthy.

I drive a Model 3 for a different set of reasons. Based on data from the IIHS, its occupants are safer in a crash than every other car ever tested [https://www.tesla.com/blog/...]. Think about that for a moment. This has nothing whatsoever to do with climate change, or whether one is left- or right-leaning. Its total cost of ownership is comparable to a Toyota Camry (my previous car) or Honda Accord [https://cleantechnica.com/2...]. And while I am disappointed in Tesla's selective use of statistical data to justify how safe its autopilot features are, even its informed critics view it as having by far the most advanced self-driving features available to the public [ https://insideevs.com/news/...]. As a driver I would never even consider going back to a non-autopilot car, as when it is used as intended, it makes me a far safer and less-stressed driver than left to my own devices. None of these things have to do with climate change.

In addition to ad hominem attacks that seek to stereotype and demean Tesla supporters, the author employs a mix of selective facts and confounding Tesla with other electric vehicle efforts to make his case. For example, a lengthy section of the article talks about the problems with sourcing cobalt, an ingredient in some batteries. First, Tesla sourcing is well documented and very sensitive to child labor issues. Second, Tesla usage of cobalt in its batteries is the lowest in the industry. And finally, Tesla is moving quickly to a battery that uses zero cobalt. That's zero as in none. [https://cleantechnica.com/2...]

Next, to the environmental impact of using electricity from the U.S. national power grid. This is well-trod ground but the best available data leads to just the opposite conclusion the author wishes to draw, both for marginal per mile usage [https://afdc.energy.gov/veh...], as well as in considering the complete life cycle, from manufacture to disposal [https://www.ucsusa.org/clea...]

One could go on about the viability of the company (Hint: it's going to be just fine), "the federal government pouring money into companies such as Tesla," and other misrepresentations, but this response has already gone on too long.

The interested reader can check these other points by simply spending some time on google and reading more than one side of the argument. Let me instead conclude with two points of caution. First, I agree with the author completely when he says "it’s more important than ever that we get to the truth." But the way of truth is humility, something in short supply in most polemics. Humility sifts through a variety of sources to get a balanced view of the facts and theses. As a scientist by training (Ph.D. in physics from Stanford) I am reminded of Sir Francis Bacon's caution about the true nature of science "If a man will begin with certainties, he shall end in doubts; but if he will be content to begin with doubts, he shall end in certainties."

Second, my antennae go up whenever I hear an argument from the left, or the right, that seems to relish in schadenfreude, rather than treating presumed opponents empathetically, giving them the benefit of the doubt as to motives, and assuming that they are thoughtful but perhaps not well informed. Searching for hypocrisy in others does not have a great pedigree [https://www.lds.org/scriptu...]. David Brook's recent book, Love Your Enemies: How Decent People Can Save America from the Culture of Contempt, is highly recommended here.

I'd be happy to get together over lunch with the author to hear him out, and then go for a ride together in my Model 3.
- - - - -

Well done. I know it gets tiring and old, but we need more of this.

 

[ZachShahan]

Choose no panel gaps. Choose a manufacturer with a lot of dealers near by. Choose a ****ing thick paint. Choose a HUD, foot-operated tail-gate, and electrical tow-hooks. Choose three years free oil changes, tire rotations and free winter tire storage. Choose the same old mind-numbing boring stuff that kills the planet, stuffing it full of Co2. Choose rotting away at the gas-station, pushing your last dollar into the petrol pump. Choose our demise.... But why would I want to do a thing like that? I chose not to choose demise. I chose something else. I chose the future:

With "commercials" like that. nothing else matters.

But there are a LOT of people who don't really watch YouTube.

There are still a LOT of people who watch TV instead.

These people are typically older, but not necessarily closed minded.

Older people tend to have more money for $40K+ cars.

Tesla has dominated social media for years, but it needs to reach the people who are not living on their phones and conversing with teenagers online.

 

[ZachShahan]

The point is that non every co-worker and father has a Tesla owner to fix their misconceptions. Eventually if enough people believe the FUD, it WILL hurt future Tesla sales. Tesla needs to preserve the halo image.

It's already hurting sales. No doubt about it.

Edit: Though, regarding those people who are not buying who might otherwise buy — many of them may find out they were tricked and eventually buy a Tesla. Or not.

 

[HG Wells]

Another possibility for initial self driving.

Rental cars at airports.
Automated drop off and pick up.
Cars never exceed 35 mph to and from lots.

Same route every time.

As you arrive, GPS tracking on phone alerts lot to send car.
By the time you reach curb car has arrived. Phone is used as key for car. ETC

 

[Brian12345]

“You're page never made any sense. This issue of people getting vehicles in weeks when there is clear demand elsewhere is sheer chaos.”

This is an excellent observation. How many more deliveries & how much frustration could be alleviated if Tesla could better match volumes if manufactured cars with consumers in a receptive market instead of attempting to match one car to one consumer who is anxious to buy immediately?

I wish Tesla would modify their thinking on dealerships. In certain markets, on the west coast for example, dealerships may not be needed. Close to manufacturing, plenty of service centers & very receptive consumers that get if.

But in many other markets in the US & internationally, having some type of arrangement with traditional dealers has several advantages:

1) dealership “buys” cars so helps with cash flow

2) inventory available immediately for test drives and sales-guarantee this increases delivery numbers.

3) Takes away one of the biggest concerns for the uniformed - cars getting serviced quickly and conveniently a the dealership.

4) if dealership/partnerships were strategically implemented it would remove many of the psychological barriers older (and more financially able ) consumers are most concerned about.

There would be a very long line of willing dealerships that would love to partner.

I think one of biggest PR problems with Tesla, and quite frankly a huge turn off/eye roller is the over hyped conspiracy stuff. If a dealership partnership was announced, if helps that narrative.

Revisiting the selective use of dealerships and coming up with a hybrid solution could solve a lot of problems and take some pressure off Tesla.

 

[ZachShahan]

“You're page never made any sense. This issue of people getting vehicles in weeks when there is clear demand elsewhere is sheer chaos.”

This is an excellent observation. How many more deliveries & how much frustration could be alleviated if Tesla could better match volumes if manufactured cars with consumers in a receptive market instead of attempting to match one car to one consumer who is anxious to buy immediately?

I wish Tesla would modify their thinking on dealerships. In certain markets, on the west coast for example, dealerships may not be needed. Close to manufacturing, plenty of service centers & very receptive consumers that get if.

But in many other markets in the US & internationally, having some type of arrangement with traditional dealers has several advantages:

1) dealership “buys” cars so helps with cash flow

2) inventory available immediately for test drives and sales-guarantee this increases delivery numbers.

3) Takes away one of the biggest concerns for the uniformed - cars getting serviced quickly and conveniently a the dealership.

4) if dealership/partnerships were strategically implemented it would remove many of the psychological barriers older (and more financially able ) consumers are most concerned about.

There would be a very long line of willing dealerships that would love to partner.

I think one of biggest PR problems with Tesla, and quite frankly a huge turn off/eye roller is the over hyped conspiracy stuff. If a dealership partnership was announced, if helps that narrative.

Revisiting the selective use of dealerships and coming up with a hybrid solution could solve a lot of problems and take some pressure off Tesla.

I agree with some of your points. Though, if Tesla started selling through any dealerships (except perhaps EV-only dealerships), I think it would immediately be on shaky legal ground for direct sales in much of the US.

Of course, if that meant shutting down Tesla stores, maybe Elon would be happy.

 

[Unpilot]

“You're page never made any sense. This issue of people getting vehicles in weeks when there is clear demand elsewhere is sheer chaos.”

This is an excellent observation. How many more deliveries & how much frustration could be alleviated if Tesla could better match volumes if manufactured cars with consumers in a receptive market instead of attempting to match one car to one consumer who is anxious to buy immediately?

I wish Tesla would modify their thinking on dealerships. In certain markets, on the west coast for example, dealerships may not be needed. Close to manufacturing, plenty of service centers & very receptive consumers that get if.

But in many other markets in the US & internationally, having some type of arrangement with traditional dealers has several advantages:

1) dealership “buys” cars so helps with cash flow

2) inventory available immediately for test drives and sales-guarantee this increases delivery numbers.

3) Takes away one of the biggest concerns for the uniformed - cars getting serviced quickly and conveniently a the dealership.

4) if dealership/partnerships were strategically implemented it would remove many of the psychological barriers older (and more financially able ) consumers are most concerned about.

There would be a very long line of willing dealerships that would love to partner.

I think one of biggest PR problems with Tesla, and quite frankly a huge turn off/eye roller is the over hyped conspiracy stuff. If a dealership partnership was announced, if helps that narrative.

Revisiting the selective use of dealerships and coming up with a hybrid solution could solve a lot of problems and take some pressure off Tesla.

Nope ...Unless there was a radically different form of dealership. As is currently structured dealership's are incentivized to sell crap to customer's. Most dealerships survive on service and markup's to a car.
The need for Service will be MUCH lower with a Tesla.

As currently structured it is hard to find a more unpleasant experience than going to a car dealer.

 

[SO16]

There would be a very long line of willing dealerships that would love to partner.

Extremely unlikely.

Where Does the Car Dealer Make Money? | Edmunds

“So where does the majority of a dealership's profit come from? It's not from car sales, at least not directly. It's from the service and parts department, which accounts for 44 percent of the dealership's gross profits, according to NADA.”

I used to bring my gas car in for service about every 6 months.

Over two years in with my Tesla? Zero to date. I did have mobile service but that was to fix cosmetic issues after initial purchase.

 

[HG Wells]

Very OT

Space alien spotted stealing burned out model S.

 

[bdy0627]

I'm sorry the COGS of the SR+ is $38-39k? Shouldn't there be more discussion of this?

This has been discussed but probably buried in the noise here. This is why Tesla will not offer the SR, which is at an even lower selling price, online. The SR+ is barely profitable barebones, while the SR is still a money loser. It's unfortunate that Tesla felt they needed to include Autopilot with the SR+. Keeping that a separate option at about $3k would be a big help for GM. I personally don't think it should be included at the $39,900 base price point.

 

[Pras]

This has been discussed but probably buried in the noise here. This is why Tesla will not offer the SR, which is at an even lower selling price, online. The SR+ is barely profitable barebones, while the SR is still a money loser. It's unfortunate that Tesla felt they needed to include Autopilot with the SR+. Keeping that a separate option at about $3k would be a big help for GM. I personally don't think it should be included at the $39,900 base price point.

With model Y ramp we will likely see price adjustment. Will be interesting to see.

 

[Prunesquallor]

What Do We Know About Tesla Owners? | CleanTechnica

• Yet –only 56% of current Tesla Model 3 owners own their own home, which means that Tesla ownership is almost more important to this segment than is residential ownership.

.

It also means that somehow, 44% of Mod3 owners find a way to charge without wiring their garage.

 

[Prunesquallor]

“You're page never made any sense. This issue of people getting vehicles in weeks when there is clear demand elsewhere is sheer chaos.”

This is an excellent observation. How many more deliveries & how much frustration could be alleviated if Tesla could better match volumes if manufactured cars with consumers in a receptive market instead of attempting to match one car to one consumer who is anxious to buy immediately?

I wish Tesla would modify their thinking on dealerships. In certain markets, on the west coast for example, dealerships may not be needed. Close to manufacturing, plenty of service centers & very receptive consumers that get if.

But in many other markets in the US & internationally, having some type of arrangement with traditional dealers has several advantages:

1) dealership “buys” cars so helps with cash flow

2) inventory available immediately for test drives and sales-guarantee this increases delivery numbers.

3) Takes away one of the biggest concerns for the uniformed - cars getting serviced quickly and conveniently a the dealership.

4) if dealership/partnerships were strategically implemented it would remove many of the psychological barriers older (and more financially able ) consumers are most concerned about.

There would be a very long line of willing dealerships that would love to partner.

I think one of biggest PR problems with Tesla, and quite frankly a huge turn off/eye roller is the over hyped conspiracy stuff. If a dealership partnership was announced, if helps that narrative.

Revisiting the selective use of dealerships and coming up with a hybrid solution could solve a lot of problems and take some pressure off Tesla.

Unfortunately, in a lot of states, it’s either buy into the whole independent dealership cartel or nothing. Given the Tesla transparent pricing and the reduced maintenance needs, I’m not sure an independent dealer could turn a profit on Teslas.

 

[bdy0627]

Elon would rather sell 350k Model 3s with an ASP of $55k than 350k Model 3s with an ASP of $43k this year.

Absolutely true. It allows Tesla to be more successful in its mission since it provides more cash for Tesla to grow and create more product lines. The only reason to sell them at a lower price is because they must - either because of battery supply limitations shifting the preferred trim mix or due to the market requiring that price point in order to sell them.

 

[sparcs]

But in many other markets in the US & internationally, having some type of arrangement with traditional dealers has several advantages:

Customers would be paying substantially more for vehicles in a dealership arrangement as you're essentially paying a middleman. Service related income on a Tesla is minimal. You would just see service charges get bloated to the obscene to make up for it.

Right now Tesla is selling every Model 3 they can build, so inventory is less of an issue. Delivery is the bigger problem. Maybe you could argue it for S/X, but those are low volume vehicles so inventory will never get too crazy.

 

[mongo]

This has been discussed but probably buried in the noise here. This is why Tesla will not offer the SR, which is at an even lower selling price, online. The SR+ is barely profitable barebones, while the SR is still a money loser. It's unfortunate that Tesla felt they needed to include Autopilot with the SR+. Keeping that a separate option at about $3k would be a big help for GM. I personally don't think it should be included at the $39,900 base price point.

38k is for robo taxi. For consumer version intenal cost, the price is off by 1.... in the ten thousand's place. (With some adjustment for 7k/wk rate)
Twitter

From the tear down :

The analysis was done by a German engineering firm. The engineers found that material cost for the Model 3 are at 18.000 dollars plus about 10.000 for production. Given that prices for the Model 3 are between 35.000 and 78.000 dollars, this would leave Tesla with room for profit.

 

[Webeevdrivers]

Customers would be paying substantially more for vehicles in a dealership arrangement as you're essentially paying a middleman. Service related income on a Tesla is minimal. You would just see service charges get bloated to the obscene to make up for it.

Right now Tesla is selling every Model 3 they can build, so inventory is less of an issue. Delivery is the bigger problem. Maybe you could argue it for S/X, but those are low volume vehicles so inventory will never get too crazy.

I agree. No need for dealerships. But service centres are needed. And more of them. It was one of the things that held us back from buying a Tesla. They need to stand on their own and generate revenue though. There are more and more cars out of warranty that will need work, upgrades etc. Make them a profit centre. But they need to be there. And not just one per province.

I would be interested to see how Tesla stacks up to Bolt or Leaf on requirement for service. Many Tesla owners have owned or still own other EV’s. Is a Tesla about the same, less, more.