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

[RobStark]

The whole idea of Tesla hooking up with AAPL is more ludicrous than Ludicrous Mode! Speculating that this might happen just makes proponents of that look like they have no idea about what's going on.

Elon Musk is in a whole different realm vs. Tim Cook.

Tim Cook looks ready for the golden handshake and a nice comfortable quiet retirement.

Then I googled him and he is only 59!

 

[woodisgood]

So it's November.

Where's da truck??

In Palo Alto, under a blanket. Obviously.

 

[ElectricOrgan]

You are missing a number of big points. First, the customers of traditional car manufacturers are the dealers, who absolutely do not want low maintenance electric cars. Second, sticking a battery and motor in a conventional car gives a sub-par experience. Example: Leaf. Note the poor sales of Leaf compared to Tesla.

So everything about Leaf sales is because they put electrics in an existing model??? That is not very well supported. To start with the Leaf originally had a very short range. Then it got a bit longer, then a bit longer to where it is still not a trip car, so no point in comparing to any Tesla.

Even if this were true, you can still use the same factories to make EVs as ICE even if the cars are not identical.

Second, you can't make electric cars without a supply of batteries, only Tesla has an actual plan for this (Yes, VW says they do, but they've been saying that for a very long time with little to show for it).

No one else is producing EVs in any volume. The ones that are making EVs have adequate supply. Are you suggesting they can't scale up battery production? That seems quite a statement. It would be like saying Tesla can't build another car factory.

Third, the 5% range reduction is more like 50% range reduction between Tesla and others. This gap will increase with new battery technology. And no, I don't think they can implement it even if they figure it out.

I can't agree with that. There is no range reduction with other brands. Other brands of cars are built with less range, period. That's because they didn't want the driver of the price to be the battery. Tesla started out with luxury cars that sell in limited quantities and can't ever become the common EVs that Musk wants to build.

While Tesla may have an edge in battery chemistry, there is no reason why others won't stay very close or even surpass Tesla. This is a race where anyone can take the lead at any time if their research finds something new. Tesla doesn't have magic, they just spent the most money the earliest.

This exact same thing happened in the tire industry when radial tires came in. The result is that only one North American tire manufacturer survived, and that was mainly because they had other products. Building a popular electric car is more than just sticking a motor and a battery in the car. People tend to purchase cars with emotions, so there needs to be something that sparks the buying emotion--in cars most typically this is performance or snob appeal, even if they don't purchase the top of the line model, or never add the racing parts to their car.

Most people don't buy performance or snob appeal. Most want transportation without pain. Tesla is not on many people's radar because their presence is so sparse. Most won't dream of buying a car over the Internet when it is a 100+ mile trip for service. The sales people can't explain to them they don't have to worry there is no Supercharger for 100 miles if they simply charge at home, because they'll never talk to a sales person.

 

[Steve m]

Are the Chinese still creating an island in the South China Sea? Maybe they can use all these spanking new GF3 Model 3s to build it out more by dumping them there.

Bad idea... These Islands are for military use. Building them with materials that will burst into intensive fires from one small bomb is no good.

 

[ElectricOrgan]

Musk is thinking of Robotaxis, he did an entire presentation about them. People who purchase cars do so mainly for the convenience of having a car always ready. If Robotaxis can make each trip seem like not a major expenditure and can be 95% as convenient as having a car right there, then most urban dwellers will use them instead of having a car. Even if that goal is achieved, it will take some time for adaptation so the private ownership with the car working for you could be a transition phase. We won't know until the network becomes reality.

I'm not sure you are getting the point. If cars can self drive like this, Tesla should not be selling them. Tesla should be the Uber of self driving cars. In fact, isn't a lot of the research in self driving being done by these guys? Tesla isn't the only self driving developer.

 

[Artful Dodger]

I wonder what the share price will do when that parking lot starts filling up with Model 3's?

(That was a rhetorical question!)

Thru extensive research, TSLAQ has already determined that:

• there isn't going to be a Gigafactory in China
• that factory isn't going to produce any cars
• those cars won't be profitable and they'll be 'chinese'
• GF3 will never produce more than 1K 3K per week
• there isn't going to be a bty workshop 2nd Gigafactory
• and, importantly, there's IS NO demand.

Anything I miss? /S

Cheers!

 

[ElectricOrgan]

The big question for the legacy auto makers isn't whether they can make an EV, it is a question of whether they can do it on a mass scale and show profitability. As far as I know, the Tesla "competitors" have developed cars to sell in small numbers because they can't sell them at any significant profit so they are more of a liability to their bottom line than anything else. Until they figure this out (and to this point nobody has that I know of) EVs will simply be compliance cars that manufacturers make to either satisfy governmental emissions regulations or an attempt to improve public relations to show everyone how "eco friendly" they are.

Dan

I don't think it is harder for GM or VW to make a profit on EVs than for Tesla. Lord knows Tesla is having a hard time with it. The major auto makers have only dipped their toes because they understand the economics and see the market is not quite there yet. They also know the real market is China. That's why the first of GM's new EVs will be made and sold there. The US will be the second batch.

 

[copyhacker]

The big issue in the Automotive space is that incumbents (and many pundits/analysts) are treating EVs as sustaining innovations, and are only treating autonomy as potentially disruptive.

This.

Most of the individual aspects of what Tesla's doing are not deal breakers for a legacy car maker. But if you add them all up? Tell you what, we'll even make it easier and leave autonomy off the table.

Replacing an ICE engine with an electric motor? Simple.
Replacing a fuel tank with a big battery? Piece of cake.
Obtaining thousands of big batteries? ehhh... can be done by forking over a gigaton of cash to a battery manufacturer, probably
OTA firmware upgrades? Sure, why not (oh, wait.. except for pesky laws saying that maintenance must be done by dealers, not OEMs)
Unified infotainment/nav/control/UI? well... we have all those vendors we'd have to scrap
Convenient fast charging network? Fuggetaboutit.
Direct sales? Not gonna happen without a bunch of friendly legislators.
Automated alien dreadnought? Over the union's dead body.

 

[dc_h]

The unions have reason to fret, that CEO Tavares is a cost cutting fiend. But he bought Opel back to profitability after 15 years of loosing money under GM.

On the EV front, my guess, is that CEO Tavares (he is not pro EV by some of his statements) take the cheap route and makes a deal to use VW's MEB platform. The Tesla parts sharing rumor doesn't seem probable to me.

I don't think MEB will work well for them. Initial costs are much higher then Tesla. The key is probably who has supply and would be willing to share pack supplies. Both VW & especially Tesla, may be able to see everything they can make at 30% margins. Is there a way for Tesla or VW to expand battery cell and pack production faster then vehicle assembly, if they had more money or guaranteed cash flow?

 

[Curt Renz]

TSLAQ. And you're likely on the TSLAQ block list(I am, as well).

Sounds like the information control systems of France in the 1790s, Germany in the 1930s, and the Soviet Union in the 1960s.

 

[TradingInvest]

Tesla should spend some effort to educate it's shareholder base. I invested in a company that every year the CEO together with the senior management team have a big meeting with shareholders. (In addition to the regular annual shareholder meeting).

The goal of that meeting is to educate the shareholders. During the meeting, they spend a lot of time candidly explain what they do, how they do it, and what to expect, the good, the bad, the long term, the short term. They want shareholders to really understand the company and to have the right expectations. They want to have the right shareholders, not to push the stock price. When I look at the stock, it has no volatility, it barely moves in months. I can guess the price correctly even if I haven't checked it for months. When I step back to look, the stock has gone up more than 1000 fold in 30 years.

Tesla attracted lots of inexperienced investors, and lots of leveraged gamblers, they become victims of the stock manipulators. When the manipulators make tons of profit, they are like shark found blood. I think educating the shareholders is very important. Good shareholder base is a valuable asset to the company. To be fair, Tesla has many intelligent investors too.

Correction, not 1000 fold, it's 120 fold. Big difference.

 

[Tslynk67]

Do you use Firefox? If so, just open a "New Private Window". Since it won't logon with your Twitter credentials, when you view a twitter feed you won't be recognized as being on the TSLAQ block list. So the feed will be displayed as if you were an unregistered twitter visitor.

Cheers!

You just need to use another browser where you're not logged-in. Copy-paste a tweet URL and you're in. Of course you can't post anything, but you can read everything - just be aware you may feel nauseous as a result and will need to take a shower afterwards.

 

[ZachF]

China says it's reached a consensus on core points with the US during this week's trade talks

I have a feeling that "China deal" will become the next Brexit... (i.e. we will be "three months away" from a new agreement for the next decade)

 

[ggr]

In Palo Alto, under a blanket. Obviously.

No, it is in Hawthorne.

 

[Mike Ambler]

I believe I remember Elon stating a few years ago that with a solar farm 100 miles square at the 4 corners area, he could power the entire United States. I wonder what it would take for Australia?

Solar -> see the red dot
Batteries -> about a pixel

Power Australia
Solar 71km2
Battery 7.1km2 (Powepacks)

 

[RobStark]

I don't think MEB will work well for them. Initial costs are much higher then Tesla. The key is probably who has supply and would be willing to share pack supplies. Both VW & especially Tesla, may be able to see everything they can make at 30% margins. Is there a way for Tesla or VW to expand battery cell and pack production faster then vehicle assembly, if they had more money or guaranteed cash flow?

Ford-VW Partnership Expands, Blue Oval Getting MEB Platform For EVs

 

[Dan Detweiler]

I don't think it is harder for GM or VW to make a profit on EVs than for Tesla. Lord knows Tesla is having a hard time with it. The major auto makers have only dipped their toes because they understand the economics and see the market is not quite there yet. They also know the real market is China. That's why the first of GM's new EVs will be made and sold there. The US will be the second batch.

Batteries? They certainly won't be able to buy them cheaper than Tesla can make them, and they certainly won't have the same specs. If they're smart they would be begging Tesla to sell them their batteries but that wouldn't help in the short term since Tesla can barely make enough now to keep up with their own cars let alone provide enough for any significant ramp by another manufacturer. So they are forced to rely on inferior tech from other manufacturers that also can't make enough. There is no way out for them without spending HUGE amounts of money and then they STILL won't have the pack technology to compete with Tesla on price or specs. They have backed themselves into a corner they very well may not be able to get out of.

Dan

 

[Mkorpal]

I have a feeling that "China deal" will become the next Brexit... (i.e. we will be "three months away" from a new agreement for the next decade)

100 bucks says it's done November 2nd, 2020.

 

[hacer]

Most mansions wouldn't even go a day with only 2 Powerwalls!

Come on, this is California. $9 million will get you about 800 square feet - 2 power walls should be plenty.

 

[heltok]

Regarding Tesla selling skateboards to FCA-PSA. Sure it makes sense for them to do that today. But once Tesla has released FSD? Imo it makes no sense for Tesla, they should just push out as many Teslas as they can because:
-They will sell every car they can produce
-Profits will be sky high on every car
-Each car will decrease CO2 emission much more than a car sold by another manufacturer without FSD

If Elon is correct in that FSD will be out around end Q4 and Robotaxi will get regulatory approval somewhere in 2020/2021 then Tesla would be stupid to give away any battery packs to anyone. What they should do is just crank out Model Ys in millions per year and buy them themselves.