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

[engle]

As we all know, Tesla Motor's 2013 mission was: "to accelerate the advent of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible." Now semi and cyber trucks have been added.

As TSLA's market cap stays near its lofty level of $100B or goes higher, there will be old ICE companies that fail to transition to self-driving EVs successfully. Some will go into bankruptcy during the next recession. As part of their reorganization, they will have to sell-off idle factories and shrink. IMHO, It will be faster for TSLA to buy up some of these idle factories for TSLA stock in slow construction places like the USA than build them from scratch (except in China! ).

I don't see any reason for TSLA to acquire any weak and failing ICE companies since they come with too much last century baggage like union contracts (instead of stock options) and dealer networks. However, perhaps the bankruptcy judge can jettison them in court?

VW probably doesn't need to catch Tesla in the near-term to survive. I actually think they have a pretty good chance of hanging in there long enough to be a major player, Telsa's future main competitor. Tesla has a proven ability to scale unbelievably quickly but even that won't be enough to meet the demand for serious EV's.

We need other players putting out desirable EV's.

 

[bhtooefr]

Keep fighting Greta:

Treasury Secretary Steven Mnuchin's actress wife Louise Linton posts and quickly deletes Instagram backing Greta Thunberg over her husband after he told the activist to go to college and study economics before lecturing people on climate change

That's a Daily Mail article, BTW, for those who wish to avoid clicking on that source.

 

[lklundin]

A usually reliable Twitter account has posted a short video in a pine plantation - apparently the GF4 site - where a detonation can be heard with the recorder saying 'Dritte' (third),
Gigafactory4 on Twitter

One would normally not set off (even small) explosives before the whole site has been surveyed for unexploded ordnance, so I take this as a strong indication that by now the whole site has been surveyed for that.

If so, we should soon get reports that the clearing of the pine plantation has commenced.

Edit: Here is a longer video, from another usually reliable Twitter account, where 3 detonations can be heard, followed by an acoustic (all clear ?) signal:
Tobias Lindh on Twitter

 

[Sean Wagner]

We need other players putting out desirable EV's.

Absolutely.

They need to finally enter a positive feedback loop, while battery cell production has to scale for costs to continue to fall. The market is too big, diverse, and changeable for one company to do it all.

Incidentally, I think the recent "revelation" by Mercedes that Tesla buying Grohmann set back their battery pack manufacturing is so much baloney. They've had enough time to scramble - the urgency just wasn't there. You'd think automation was today's porcelain, confined to a small band of Black Forest dwarves.

I see potential parallels between Tesla buying "team Grohmann" in a hurry and Volkswagen's acquisition of "software companies" [I'm lacking info here]. If VAG is not completely daft, they'll keep working teams of savvy developers together, give them clear marching orders [!!!], a lot of leeway, and keep corporate bureaucracy out of their hair.

Ford's very small and diverse team that re-conceived the Mach-E with some urgency is a good example [on a vastly smaller scale] of how to do it, but it only works when everyone understands where to go and what is expected.

Which is why Tesla's mission makes such a difference. It's simple and creates a shared space for communications and decision-read-difference making. Building the Nevada Gigafactory seemed insane if you didn't understand its propulsive properties.

 

[Christine69420]

Lots of conjecture that there may be some extra cost to upgrade HW2/MCU1 vehicles (S/X early Feb 2018 or before) to HW3.

Probably because Elon tweeted some time ago that the oldest cars who have waited the longest would get the HW3 upgrade first. But now it looks like we are last in line.

If there are a lot of FSD AP1/AP2.x cars with MCU1 (any way to tell?), could be some extra cost. Any way to tell how many of the 50k are in this category?

The TeslaFi site have lots of statistics. It's based on it's members cars but is large enough to be relevant IMHO.

TeslaFi.com Firmware Tracker

 

[Sean Wagner]

And while I'm at it, this does seem germane to the posts above:

Ford Europe looks to have two Mach-E's on tour, and it seems like a pretty impromptu thing.

One German dealer in the small town of Bad Neustadt had a week's time to organize an unveiling ["I had planned on two days of skiing"], but the event was packed.

See

Incidentally, the Mach-E's screen is supplied from there. Interesting.

 

[pyromatter]

 

[Words of HABIT]

Is it just me or does Trump come across as the smartest guy in the room?

I’m going to take a shower now. I feel dirty.

IMO the US President or any Presidential candidate trashing Tesla will not get elected in November 2020. Therefore, Ralph Nader is out of the running due to his recent tweet. Ralph Nader appeared to only attack Tesla to state the opposite of Donald Trump, trying to distance himself.

 

[Tslynk67]

Keep fighting Greta:

Treasury Secretary Steven Mnuchin's actress wife Louise Linton posts and quickly deletes Instagram backing Greta Thunberg over her husband after he told the activist to go to college and study economics before lecturing people on climate change

Don't know how people could cohabitate together with such opposing views. For a good long-term relationship you need similar life-philosophies, well either that or lots of really great sex - but the latter does tend to drop off a bit after the first couple of years and very much so when kids come on the scene.

It's like George and Kellyanne - how does that work? Answers on a postcard please, to the usual address.

 

[Words of HABIT]

Trump outed himself as a big Elon fan just recently during a bizarre interview at this year's Davos summit.

Our President doesn't come off as a particularly intelligent individual, but at least he has given a warning [deleted stuff]

Can we please stop with the references to the annihilation of Elon. This is clearly spreading FUD and should not be tolerated on this forum. Thank you.

Mod deleted offensive part.

 

[SageBrush]

This bleating about regulation is a red herring.

I call it an externalized cost of ICE, but your point is spot on.

 

[Remus]

Indeed, took at $TSLAQ this morning, and all they care about in all of this is GF3 production being compromised.

They really are a bunch a shits. Go browse yourselves if you dare, it's pretty revolting though.

View attachment 504369

I think this do have a negative effect on the share price temporarily.

Usually there will be a huge influx of people going into Beijing Shanghai and Shenzhen after the new year holiday ends. Looks like the government is trying to stop people from going into these cities to prevent the outbreak. It will definitely have negative effect on all economical activities. At the same time expect the suppliers to be affected too.

I am horrible at market timing.. so I will keep my dollar cost average buying and be glad to get more shares. But high flying option surfers may want to cut back a little.

 

[Hock1]

IMO the US President or any Presidential candidate trashing Tesla will not get elected in November 2020. Therefore, Ralph Nader is out of the running due to his recent tweet. Ralph Nader appeared to only attack Tesla to state the opposite of Donald Trump, trying to distance himself.

Has there ever been an 85 year-old "in the running" for President?

 

[Words of HABIT]

First confirmed case of the Coronavirus found in Canada (affected patient is at Sunnybrook Hospital, Toronto) which is 24km from where I live. This shows me how small and interconnected this planet is, and how important it is that what we do as individuals affects each other. We really are all in this together. We are all one people. We all share one environment.

CTV News report confirming Coronavirus now in Canada
Canada's first 'presumptive positive' case of coronavirus found in Ontario

CTV interview with infectious disease specialist Dr. Neil Rau.
This is a very good explanation of Coronavirus virus. Dr. Rau several times refers to this as a "mild" disease, and that for those infected would not kill heathy individuals.

The major Financial Markets will get pushed down in the short term due uncertainty, however the Coronavirus will pass (weeks? months?) and become distant memory like SARS. Longs may be tested. The Tesla thesis and Master Plans are unchanged, even more urgently needed in today's World. My investment in Tesla remains strong. IMHO there is still no better place to invest my hard earned money.

EDIT: removed 2nd link. The interview with Dr. Rau is the 2nd CTV clip that follows the first CTV clip for which link was provided.

 

[CalX]

I think this do have a negative effect on the share price temporarily.

Usually there will be a huge influx of people going into Beijing Shanghai and Shenzhen after the new year holiday ends. Looks like the government is trying to stop people from going into these cities to prevent the outbreak. It will definitely have negative effect on all economical activities. At the same time expect the suppliers to be affected too.

I am horrible at market timing.. so I will keep my dollar cost average buying and be glad to get more shares. But high flying option surfers may want to cut back a little.

You do know that they have stores all over China and can buy online right?

 

[Remus]

You do know that they have stores all over China and can buy online right?

You do know they are production limited right?

 

[gerebgraus]

VW probably doesn't need to catch Tesla in the near-term to survive. I actually think they have a pretty good chance of hanging in there long enough to be a major player, Telsa's future main competitor. Tesla has a proven ability to scale unbelievably quickly but even that won't be enough to meet the demand for serious EV's.

We need other players putting out desirable EV's.

There will be a major shake up. Tesla will be the dominant player with monopolistic profits. I doubt we will see gross margins under 25% any more with exceptions of major ramp-up period. Otherwise gross margins will climb over 40% within 2 years. Most legacy carmakers will go out of business although their brand names might survive under new ownership. (My model for transition is the CRT tv to LCD. It is an imperfect analogy, but it is much better than going from horses to ICE. Personally I preferred the smell of horse manure to gas exhaust. Anybody else remembers? )
There will be some other remaining players with much smaller profit margins: BEV has becoming very complex and at this point it would be very difficult for a new startup to make it. Rivian has a chance especially because of financial support and orders from Amazon. 2 or 3 Chinese companies will make it. My sense that possibly between 1 to 3 big legacy car maker will also survive, but they would need to totally restructure the business. Only Diess of VW admits that, but that does not mean that VW will be among the survivors.

 

[berryja]

Let's hope that Tesla gives us some kind of information during the ER on revenues from software offers, such as the Model 3 AWD performance boost for $2000. Papafox just purchased the upgrade and offers a one minute video giving you a quick appraisal of the feature here:

Hey, it's a weekend ; )

Too funny!

 

[VValleyEV]

Probably because Elon tweeted some time ago that the oldest cars who have waited the longest would get the HW3 upgrade first. But now it looks like we are last in line.



The TeslaFi site have lots of statistics. It's based on it's members cars but is large enough to be relevant IMHO.

TeslaFi.com Firmware Tracker

I am a TeslaFi user.

Unfortunately, their data doesn’t help much for “how many FSD vehicles have MCU1”. They don’t track MCU1 or FSD. Also, out of the 3753 S/X models in the database, 2382 (63%) have the AP version listed as “unknown”.

We do know quite a bit: that MCU1 exists only in S/X, and only in cars with AP1, AP2, and AP2.5, and for AP2.5 vehicles, only for those built before late Feb 2018. Of course Tesla has all the data.

Again, this is likely a non-issue, raised simply because we haven’t seen evidence of an S/X with MCU1 upgraded by Tesla to HW3 because of FSD pre-payment. Also we have heard reports of enthusiasts upgrading AP2.5 to AP3/HW3 themselves while retaining MCU1 (@verygreen), and that is encourraging.

But until we have evidence that Tesla has performed an FSD HW3 upgrade on an MCU1 S/X vehicle, there will be some handwringing. Same goes for evidence that they have done an FSD upgrade from AP1 or AP2.0.

 

[Buckminster]

For anybody who missed the discussion on Tesla's $1.8B valuation allowance last weekend, or never really understood much of it, I just wrote a blog post summarizing everything on the topic:

Tesla's $1.8B Valuation Allowance: Could it mean FY 2019 GAAP profits and immediate S&P 500 inclusion?

Frank - many thanks for this - incredibly useful. You went for 10-20% likelihood - see below, it feels like you are teasing me.... Decisions decisions.

Short term calls look pretty pricy. I might take my first long shot in a while but only a day or two before ER once the premium has come down. But only if there is consensus here that there is a 20%+ chance on immediate S&P inclusion. The sheer number of potential short squeeze catalysts is off the charts - surely one of them is gonna spark into life.