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

[EVNow]

I think people are making too much of this. Had Musk's e-mail not leaked, we wouldn't have closed the day at $243!

Right - we would have been around 230 … like now ! But no drama … but what is TSLA without the drama ?

But, I do think Musk/Tesla has a dilemma. How to encourage seller to sell more at the end - without giving any hints about the delivery numbers ? Because, I'd like a good surprise on P&D, rather than a record, but, miss.

 

[M3Rider]

Completely agree. The Y will not make any money in the first couple of production quarters as volumes ramp and fixed costs crush per unit margins.

Then the price drop comes. Don't forget about price drops.

The goal is not to make money. "Pace of innovation is all that matters". OEMs will keep getting a regular kick in the butts, there will be no time for them to relax and count the money.

 

[jerry33]

There are other interesting synergies going on as well. In Texas, the big wind farms are out in the Panhandle and Trans-Pecos, and the big consumers are Austin, San Antonio, DFW and Houston in the east. In an amazing feat of forward thinking, the state authorize a huge upgrade in the transmission grid to move all that wind power

This may have been the catalyst to finally open the floodgates for Texas solar. There is a LOT of west Texas acreage that is well-suited for solar, and now the transmission capability is ready and waiting.

Almost all new power generation applied for in Texas is solar. NG and coal are being shut down as they reach EOL.

 

[willw64]

Had the number come in at 100k or slightly higher the stock probably would have hung in there until the earning's announcement where the focus would have been on GM's. If in fact order backlog is up, missing the number by 2k or 3k isn't a big deal and the focus on the call will be did the GM stabilIze or go up, and can Tesla sell cars at a profit.

 

[EVNow]

So if I started driving 300 mi/day instead of 20 my electric bill would not change!

Would be useful for Uber/Lyft drivers.

 

[Prunesquallor]

Excellent stuff. Have you seen this?

Storage developer plans to bring batteries to 149 MW Texas wind portfolio in SPP territory

I had NOT seen that. And this is the first I’ve heard of Glidepath. Most excellent.

They may be promoting this as grid stabilization right now, but my money says they’re eventually going after the NG peaker plants.

 

[T3slaOwner]

Thanks for the fix. How long ago did they last push out the quarter they said they would be up to 7K per week?
I pray they do reach 7K by end of this year, but preferably by next month so they can produce as many 3s as they have
demand for and show a good bump up in M3 deliveries for Q4.

I'll be happy if they start making a profit every quarter. Oh yeah, and start fixing the intermittent issues with my car!

 

[StealthP3D]

Big Iron sells cars the way they do because it sells cars.

I agree, the games the big three played worked in the past. And it continued working long after the car-buying public grew tired of it. But they wouldn't stop playing the same stupid games because they didn't have to stop. And the games helped them earn profits on inferior products. The barriers to entry were so high the big three had no competition. Enter Tesla.

Now the car-buying public has a choice. Let's see what happens.

I'm pretty sure most people are sick and tired of all the games.

 

[KSilver2000]

Would be useful for Uber/Lyft drivers.

I don’t know whether someone who relies on earning income from driving Uber/Lyft should be buying a Tesla.

 

[EVNow]

Completely agree. The Y will not make any money in the first couple of production quarters as volumes ramp and fixed costs crush per unit margins.

What fixed costs ? Unlike 3 - there isn't much.

Y will play out differently than 3. The % increase in volume is much smaller than with 3. When Y starts production, Tesla will already be gaap break-even with 3 + S&X.

The likely issue is high profits in the beginning quarters when Y has ramped up - but producing only high margin trims. Then the lower trims start - reducing the margin - like it happened with 3. I hope Tesla guides properly for this.

 

[Bet the House]

Agreed. My wild guess is that we bottom out in the next half hour or so and start a slow climb for the rest of the day back to $232-233 by the end of the day.

Whats the saying, even a broke clock is correct twice a day?

(I'm pretty sure this is the first time I actually had a prediction that was close to being correct)

 

[Cherry Wine]

Just like in Q3/Q4 '18 - I'd guess good profits and revenue boost. May be not to the same extent. After Q3 ER I'll model next year.

I am eagerly awaiting your model. Really appreciated.

 

[Cherry Wine]

Completely agree. The Y will not make any money in the first couple of production quarters as volumes ramp and fixed costs crush per unit margins.

Two considerations:

1. Shared cost efficiencies.
2. Manufacturing lessons learned.

Thoughts?

 

[T3slaOwner]

I got a lot of "likes" on this, so I’ll expand further.

My old energy plan was provider's-choice for source at $0.096/kWhr energy charge. The new plan is all renewable: solar days (0600-2100) at $0.163/kWe and wind nights at $0.00. When all the transmission charges were taken into account, I would break even if my night/day usage ratio was 35/65 or higher.

Wow! Wish I could get that. I can survive with no A/C during the days, but winter I have to heat at night. I'd do the thing where they heat rocks/water at night and let that keep the house warm during the day.

I don't drive much - maybe 600 mi/month. But with the new plan I’m still saving 10-35% (determined mostly by how much the home AC is running during the day) over the old plan (as long as I still charge at home every night). But an interesting observation is that even if I started driving a lot, an 11 kW charging rate could still completely recharge a 75 kWhr EV battery in the 9 hr window of free energy. So if I started driving 300 mi/day instead of 20 my electric bill would not change!

I think most people don't realize the cost of fueling an EV is pretty much in the noise for most who use electricity for heating or A/C.

This seems to show the potential for an excellent synergy between abundant wind power and electric vehicles.

Since there is (currently) no good grid storage for excess wind energy during off-peak use, the EV batteries serve that role. The energy provider charges a higher rate during peak hours (essentially getting some income from this otherwise spilled power) and the consumer potentially still saves money (depending on usage patterns).

Our energy grid is something that will be evolving. Hydroelectric storage is a good pair with wind power where it's available. But there just isn't enough of it. Some have talked about making storage rather than relying on natural formations. Mines can be used or built. I haven't looked into it, but there are clearly options available.

This will all change if 1) there are enough EVs charging at night to significantly change the demand curve and/or 2) grid-scale energy storage comes online.

If you do a little math you will find EVs charging at times of poor pairing of generation and use will be a good thing. For the most part, even if everyone is driving EVs we will not need to change the infrastructure, other than possibly some local distribution, to charge EVs. In fact, if managed wisely and not manipulated by the utilities, EV charging will be a net positive.

 

[M3Rider]

Whats the saying, even a broke clock is correct twice a day?

(I'm pretty sure this is the first time I actually had a prediction that was close to being correct)

Don't give yourself a pat on the back yet, @anthonyj 's target is 235. Lets see who wins.

 

[T3slaOwner]

Two considerations:

1. Shared cost efficiencies.
2. Manufacturing lessons learned.

Thoughts?

They make the S and X on the same line even though they only use something like 20% common parts. I believe they are building a whole, new line for the model Y but it should come up to speed fairly quickly. They are claiming the model 3 line in China will be producing shippable cars in two weeks.

If they actually produce significant volumes of model 3s from China this year (to me that's 1000 a week) I'll be impressed and this would be Tesla's first true production win. If they are still making only a couple of hundred a week it's a fail in my opinion. I'm wondering if there will be culture clash in any of this?

 

[jerry33]

I had NOT seen that. And this is the first I’ve heard of Glidepath. Most excellent.

They may be promoting this as grid stabilization right now, but my money says they’re eventually going after the NG peaker plants.

In Texas, the legislators have classified battery storage as energy generation, not energy storage, so it can't really be used until the law changes.

 

[CyberDutchie]

Oh my god, how can they be lying time and time again and get away with it?

Tesla Stock Is Sinking on Disappointing Deliveries. Here’s What Wall Street Is Saying.

The company said Wednesday evening that it delivered fewer vehicles than expected based on FactSet’s consensus expectation, though more than it reported in the second quarter.

Where did Tesla say they delivered fewer vehicles than expected?

Here’s what Tesla actually said:

In the third quarter, we achieved record production of 96,155 vehicles and record deliveries of approximately 97,000 vehicles. In addition, we achieved record net orders in Q3 and are entering Q4 with an increase in our order backlog.

This is right-out criminal. Scumbags!

Add the one word and you’ll see how ridiculous their first sentence is:

Shares of Tesla fell Thursday after the electric auto maker disappointed investors with its release of record third-quarter delivery and record production numbers after the market’s close Wednesday.

 

[T3slaOwner]

What fixed costs ? Unlike 3 - there isn't much.

Why not??? They have built a whole new line. That gets depreciated over time if the cars are built or not. No small part of the costs.

Y will play out differently than 3. The % increase in volume is much smaller than with 3. When Y starts production, Tesla will already be gaap break-even with 3 + S&X.

The likely issue is high profits in the beginning quarters when Y has ramped up - but producing only high margin trims. Then the lower trims start - reducing the margin - like it happened with 3. I hope Tesla guides properly for this.

Reasonable, but the devil is in the details. Also very likely is a drop in model 3 sales as the Y fills backlog orders doubling up your hump effect. That could easily put the company back into the RED.

 

[Duffer]

Oh my god, how can they be lying time and time again and get away with it?

Tesla Stock Is Sinking on Disappointing Deliveries. Here’s What Wall Street Is Saying.

The company said Wednesday evening that it delivered fewer vehicles than expected based on FactSet’s consensus expectation, though more than it reported in the second quarter.

Where did Tesla say they delivered fewer vehicles than expected?

Here’s what Tesla actually said:

In the third quarter, we achieved record production of 96,155 vehicles and record deliveries of approximately 97,000 vehicles. In addition, we achieved record net orders in Q3 and are entering Q4 with an increase in our order backlog.

This is right-out criminal. Scumbags!

Because a lot of money is being made by manipulating the stock, which leaves plenty for "greasing" the right palms.