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

[neroden]

FWIW, I don't think that we can read demand from deliveries until (a) the reservation queue is gone, (b) production is ramped up to full speed, and (c) inventory starts to build up. That did actually happen with Model S a few years ago, but hasn't happened with Model X yet, let alone Model 3.

Model 3 won't be through the reservation queue by the end of the *year*, globally speaking.

Model S and X were down for renovations for much of Q1 and had to ramp back up in Q2 so we won't see numbers reflecting demand until Q3 (I expect to see more X than S).

 

[dmckinstry]

As an engineer, I have immense respect for that generation of engineers, the generation of engineers that build the Blackbird and the Concorde, and put men on the moon, with nothing more than a slide rule.

As for putting men on the moon, they had far better accuracy than any analog computing device available.
In the mid '60's the first computer I programmed for (the IBM 1620, using FORTRAN of that generation) was capable of programmable accuracy. In fact a fellow graduate student (was studying gravity waves) had a side project of generating Fibonacci tables. Of course none of the could be done within multiple powers of 10 of real time.

 

[Mars ☰mperor]

Changed without notice. That is apparently pretty normal for most brokerages FWIW -- if people know brokerages which push a notification at you immediately when they change special margin maintenance requirements, let me know.

About a month or two ago, IB gave a week ahead notification before changing from 30% to 40% margin requirement for $TSLA.

ALSO the 10% was a gradual transition.

Edit: @durkie has mentioned it

 

[dmckinstry]

Where are you getting this from? I saw this recently but haven't seen too much data around raw materials supply:

Nice plug for Model 3 design in reducing copper in its wiring harness over their previous models as well as every other car manufacturer. Somewhere fairly near the end of the video.

 

[Troy]

Don’t take it the wrong way, I appreciate the work you did. But as others said, you better admit it when it didn’t work well.

If you click on the link next to 80K, 85K or 89K, I said I will update my estimate on 30 June 2019. It's not like each time I said, it was my final estimate and then kept changing it. It was well understood that the estimate would change. I tweet my final estimate on the last day of the quarter and then measure the accuracy of that. I have done the same thing for many quarters.

As more data comes in, I update my estimate. For example, right now my Q3 2019 delivery estimate is 88K. Around 10 Aug, I will have the EU numbers for July and I will update my estimate. Then around 10 Sep, I will have the EU numbers for Aug and I will update my estimate again. Then on 30 Sep, I will tweet my final estimate for Q3. It's not complicated. I don't use Twitter much. In June 2019, I tweeted only 11 times excluded responses and most of them were estimates. It's easy to follow.

• 76K on 26 May 2019 here, 80% accurate
• 80K on 9 June 2019 here, 84% accurate
• 85K on 16 June 2019 here, 89% accurate
• 89K on 24 June 2019 here, 94% accurate
• 91K on 30 June 2019 here, 96% accurate

 

[Alphacrux]

About a month or two ago, IB gave a week ahead notification before changing from 30% to 40% margin requirement for $TSLA.

ALSO the 10% was a gradual transition.

ETrade gave me a 1-day notice raising the requirement from 40% to 45%. Then gave another 1-day's notice THE NEXT DAY to raise it from 45% to 55%.

 

[Troy]

I decided to open the estimates survey for Q3 2019 early. You can add your estimate here:

Tesla Production & Delivery Estimates Survey

You can edit your estimate as many times as you wish until the end of 30 Sep 2019, Pacific Time. Only your final estimate counts.

 

[Antares Nebula]

I decided to open the estimates survey for Q3 2019 early. You can add your estimate here:

Tesla Production & Delivery Estimates Survey

You can edit your estimate as many times as you wish until the end of 30 Sep 2019, Pacific Time. Only your final estimate counts.

We have to sign in?! C'mon, make it easier. Can't we do this within TMC website?

You can add my estimate if you wish: (deliveries only) S,X: 20k, 3: 80k (Total: 100k)
Thanks!

 

[Off Shore]

Sooooo, I'm thinking about that leaked memo. How fast IS Shanghai going to come up? It is basically a copy-and-paste job (none of this "learning how to make a car production line" stuff which Fremont repeatedly dealt with). I could see the first cars coming out in early October, with volume production in January.

I can't believe Elon Musk will pass up an opportunity to improve things at GF3.

 

[schonelucht]

These numbers are all too low. I repeat my comment from yesterday, especially after the leaked email... There is ZERO chance Q3 deliveries will be lower than Q2 (barring an earthquake or other unforeseen event that affects production). DEMAND IS NOT AN ISSUE.

Is it possible the planned line upgrades reduce production with a corresponding impact on deliveries? Maybe not an earthquake but 2 weeks of shutdown is not unheard of in the automotive industry and would basically mean 12-14k less cars to deliver.

 

[Tslynk67]

Context is everything. Example: I own land that's been degraded by a millennium of overgrazing; while in ancient times it surely was home to birch forest, today it's 50% poor grassland and 50% gravel barrens (well, and some iron bogs, but they're good and shall remain boggy). The canyon slopes are subject to landslides as a result of the degradation. Simple restoration of the soil by fertilizer (it's highly phosphorus and nitrogen deficient), manure, or seeding leguminous plants can increase the amount of carbon in the soil (and overland) dramatically in 5-10 years or so - about 10t/ha aboveground and ~120t/ha underground to the gravel barrens, somewhat less for the poor grasslands. Reforestation (taiga species) would add another ~80t/ha aboveground and ~50t/ha underground over several decades. So long as the biome remains "forest", the carbon sequestered will not decline, as new trees replace ones that die - indeed, mature trees would continue to seed the barrens around them, expanding their groves and continuing to lock up more carbon. So long as grasslands are not allowed to become overgrazed again, their carbon, too, will remain locked up.

I have 8ha. That's a lot of carbon sequestration potential just from restoration and reforestation - something like 2000t when all is said and done. Honestly, the only thing that stops me from doing more is how much money I have to sink into things like soil restoration or buying seedlings. Even the smallest conifer seedlings I can get are ~$2 each, which would mean tens of thousands of dollars in reforestation costs. If I want larger trees that get the job done sooner, they're even more expensive. I've already spent many hundreds of dollars on fertilizer, and probably need to spend thousands more to get phosphorus up to normal. And whether I do nitrogen from synthetic fertilizers, paying for dozens of manure spreader truckloads, or legume planting, that too will come with a significant price tag.

Or to put it another way... cash does sequester carbon.

(On that note, if anyone wants to sequester some carbon, you're more than welcome to support restoration or reforestation plans on my land - I'd do all the grunt work, and send photos of your plants Realistically, though, I expect this to just be a project that I slowly fund myself over the course of decades)

Start a crowdsource "Help Karen Plant A Forest", or something like that - I'm sure a lot of us would chip in.

 

[Antares Nebula]

I can't believe Elon Musk will pass up an opportunity to improve things at GF3.

There will definitely be improvements; it's not copy and paste of Fremont. Tesla stated as much in Q1 report.

 

[Tslynk67]

(*cough*)bulls**t(*cough*)

Seriously, will people please stop with this? It's really annoying to the large amount of people in the world (myself included) who still are unable to buy any Model 3 at all. Including some of the world's largest auto markets, like India, Russia, Brazil, eastern Europe, Saudi Arabia, etc.

Let's totally forget that even in the places that can buy Model 3s, SR+s only started getting delivered right at the end of the quarter, and RHD countries only just started getting any vehicles at all right near the end of the quarter as well. Let's also forget that this sort of theorized "demand decline" has never happened in the history of Tesla, because each time a new vehicle enters a market, getting vehicles on the road stimulates new sales to people who were previously not buyers (e.g. early buyers end up triggering their friends / family / coworkers / neighbors / etc to buy one). Let's furthermore forget that the total EV market grows every year as new people decide to go electric for their next vehicle.

Indeed, I don't think we saw any M3SR's delivered in Norway yet, I could imagine the country could take the whole European production run for several quarters given the capacity they've shown for the P and LR variants.

 

[kengchang]

I'm not sure if this will affect TSLA in the short term, but it seems possible.

Former Tesla employee admits uploading Autopilot source code to his iCloud

At the end of 2018, Cao allegedly deleted 120,000 files off his work computer, disconnected his personal iCloud account, and deleted his browser history all around the same time he accepted a job with XPeng, an EV startup based in China that makes cars that look very similar to Tesla’s. Tesla also claimed Cao recruited another Autopilot employee to XPeng in February.​

Any update on the shakoobash or sth trial?

 

[kengchang]

Indeed, I don't think we saw any M3SR's delivered in Norway yet, I could imagine the country could take the whole European production run for several quarters given the capacity they've shown for the P and LR variants.

Netherland is phasing out the EV incentive next year, should provide healthy boost to the demand.

 

[Tslynk67]

Sooooo, I'm thinking about that leaked memo. How fast IS Shanghai going to come up? It is basically a copy-and-paste job (none of this "learning how to make a car production line" stuff which Fremont repeatedly dealt with). I could see the first cars coming out in early October, with volume production in January.

I think the moment one car comes off the line, we'll see a significant SP bump - Wall Street seem to either be in denial or are wilfully ignoring it, will be a big wake-up call IMO.

 

[Tslynk67]

I expect 3K production and deliveries at Shanghai in Q4 2019, not 10K. See my table here.

I'm with you on this, Troy. Let's face it folks, we have prior here with ramping up production and it was very ugly. Granted they have experience at it now, but I think better to err on the side if caution and get a pleasant surprise rather than hyping it up for a fall.

 

[NicoV]

In Europe, there are no more reservation holders left.

the demand in Europe going forward will be 11K, not 18K

Seriously, will people please stop with this? It's really annoying to the large amount of people in the world (myself included) who still are unable to buy any Model 3 at all. Including some of the world's largest auto markets, like India, Russia, Brazil, eastern Europe, Saudi Arabia, etc.

If they manage 18K each quarter going forward, and we assume a 20% cancellation rate, *they won't run through the European reservation queue until middle of Q4 2019*.

It is simply not true that there are no reservation holders left in Europe in the regions where delivery is possible. I know about 6 Belgian reservations: 3 have been delivered, 1 has been cancelled, and the remaining 2 are still open.

Europe has a very different mentality with respect to buying cars compared to the USA. We don’t have the inventory system, so nobody wakes up in the morning with the idea of buying a nice new car, and buying whatever is on the next doors dealer lot so that they can drive the car in the evening. Europeans are used to the built-to-order system (inventory sales are only done to clear out showrooms cars). They buy their car on their own schedule, not on Tesla’s schedule.

In the Netherlands, many people will decide to buy a Model 3 before the end of 2019, since then tax benefits go down as of 1/1/2020. The previous tax cliff caused 12K Model S/X deliveries in H2 2018, so I expect H2 2019 to be a multiple of that for Model 3 (in the Netherlands alone).

Looking at the companies around me that I’m familiar with: they are still figuring out how to organize their company car fleet in such a way that they can support EV’s, but when they do, their Model 3 demand will be massive. Currently it’s only small companies with short decision lines and flexible policies that buy Model 3 as company cars.

I can't really guess what they're going to do in terms of "unwinding the wave". They could bring deliveries down fairly low if they *really* unwound the wave, but I don't think they'll do that quickly.

There’s a ship at pier 80, it looks like Tesla will unwind the wave by starting shipping to Europe earlier in the quarter, and stop shipping earlier in the quarter so that there’s less inventory in transit at the end of the quarter.

 

[ProfTournesol]

I decided to open the estimates survey for Q3 2019 early. You can add your estimate here:

Tesla Production & Delivery Estimates Survey

You can edit your estimate as many times as you wish until the end of 30 Sep 2019, Pacific Time. Only your final estimate counts.

done! filled in the form, but I have to say I need to adjust during the quarter. I don't know if there will be schaduled and unscheduled production stops. Also the start of M3 production in china may or may not happen in Q3. Rumors say 2nd week of September some parts in China will start producing. If anybody has any intel about suppliers for the GF3, please let me/us know!

 

[Singer3000]

First I thought this was a joke.

Then I realized it indeed was a joke, written by a freaking clown.

Jonas is an unpopular fellow on these boards but he was bang on right when he implored Elon to raise capital at +350 prices. He may or may not be completely wrong with his updated sales forecasts (I personally think he is wrong).

But ignore his concluding remark at your peril:
“we believe the conviction, passion and time horizon of the prevailing bear case in the market may take several more months or quarters to break”.