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

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TBH I don't think Tesla needs any bailout, I don't think Elon would accept it and I don't want it to happen.

It would be that $450m loan story all over again, yes, the one that was repaid early, the same one that some other manufacturers didn't yet pay back, what 12 years later, and yet it gets dished-up as FUD against Tesla even today.

What would be far better would be for Tesla to negotiate some other kind of assistance, other than cash. What that might be, I don't know, but I'm sure there are plenty of possibilities for bright and inquiring minds to come up with.

Agreed.

How bout we start with...

wait for it...

Letting Tesla sell their products in the whole country? You know, like the commerce clause in the Constitution says?

Fire Away!
(It’s (STILL) the batteries, Stupid!)
 
Ventilators are not a cure. If you're on a vent you have serious issues, probably some permanent lung damage, and may die.
No, they are not a cure. But politically, they are an important threshold. Society is willing to accept that some will die on ventilators, but many will find it unacceptable to allow people to die more quickly for lack of ventilators. There are other critical thresholds where our capacity to deliver life sustaining health care is overwhelmed.

So we need to be careful about any bottleneck in the health care supply chain, not just ventilators. So long as the health care system is overstressed, workers will be prevented from returning to work. This is a basic socio-political reality. I wish Musk understood this. For some reason he is unable to see this from a systems point of view, but is rather narrowly focused on what Tesla needs. A pandemic can be seen as a supply chain problem. Musk needs a supply of healthy workers to turn cogs in the factory, but the systems that secure a health workforces are under enormous stress. He needs to think more about how to relieve bottlenecks in the workforce supply chain. Whatever he can do to prevent or relieve bottlenecks will be greatly appreciated and actually help Tesla get back on track.
 
I have agree because personally I have been fighting to survive this crap for 11days now, with asthma and then getting this it is extremely difficult and wears you down. 4 Doctors have told me I should go to ER but being stubborn as I am I refuse and am still trying to beat this with home care in isolation. Wish me luck as it is wearing me down. Do not underestimate this crap.
I'm with you. I deal with asthma too, and my lungs are very prone to get a bronchial infection anytime I catch a simple cold. I absolutely do not want to catch this crap. And I personally care whether my local hospital will have the means to care for me should I need it. The best thing I can do for my family, my employer and the economy generally is avoid getting sick. Even the common cold coupled with an overstressed health care system could send me down a perilous path.

So take good care of yourself. That's really the best thing for all of us.
 
I believe the California state order that declares Tesla and other vehicle manufacturing activities within the state as "critical" (in line with federal law) suggests the following:
  • Tesla shut down Fremont voluntarily in a time period (last week of Q1) where they were primarily making Q2 vehicles for Europe and China already. They did this probably to reduce local criticism in the Bay Area where most big companies are shutting down and are switching to work from home.
  • They'll start a comprehensive worker health protection program in Fremont like in Shanghai, with masks, gloves, goggles, temperature monitoring, IR camera screening at the gates and periodic disinfection within the factory, no shuttle buses, etc. See the protection methods in China.
  • They'll start ventilator production.
  • In 2-4 weeks they'll restart vehicle production with lower staffing initially, and they'll make high margin vehicles like the Model Y and AWD/P models. They'll restock near zero or critically low inventory levels in various markets like the UK - which also helps their legal standing to restart.
  • They have the authority under the California state directive and federal law, the Alameda county directives will either have to be modified, or can be ignored. If Alameda county still disagrees at that point, they can sue and they'll lose in court.
  • Because the US economy is tanking and unemployment is soaring (expect U.S. unemployment to soar in next week's report by 1 million or more), while the virus and lockdowns are spreading, it's unrealistic to expect new car sales to be unaffected. This is why the other big OEMs shut down their factories. Q2 sales will drop across the industry while consumer fear and physical lockdowns run their course.
  • They'll keep the parts of Fremont running that supply parts to GF3, such as the seat factory, with reduced staffing. GF1 won't have to shut down and will supply battery packs and power trains. GF3 will ramp up to 250,000/year faster than originally planned. Chinese economic activity is already in a post-pandemic rebound.
I.e. I believe Tesla did the pragmatic thing given local pressure and economic uncertainty, while making it easier to supply GF3 and to restart the factory while the lockdown is in place.

Edit, now that I caught up with the thread, the news that GF3 is switching to two shifts is additional confirmation IMO:

Kelvin Yang on Twitter

"GF3 2 shifts next week enabling 3k/week run rate"​

If GF3 receives enough batteries from the U.S. they might even switch to three shift production, with a 4k/week runrate or more.

Tesla isn't a single factory company anymore, and their primary limit is battery output.

Good report.

Q: I wonder if Tesla will modify transfer pricing (US to China sales) allow for more cash to be returned to Tesla USA? Further, does Tesla's agreement with China allow for a more liberal policy for profits/currency to be transferred back to the USA?
 
  • Informative
Reactions: Eugene Ash
Allowing to sell and service in EVERY state would be a good start.
I was thinking the same thing. Similar to inter-state commerce, one state's product must be allowed to be sold in the same manner in every state. States wouldn’t be allowed to impede Tesla sales by arbitrary dealership-cartel laws. THAT would be a whole lot smarter than a (hopefully) unneeded bailout.

edit. I see others beat me to this.
 
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No, they are not a cure. But politically, they are an important threshold. Society is willing to accept that some will die on ventilators, but many will find it unacceptable to allow people to die more quickly for lack of ventilators. There are other critical thresholds where our capacity to deliver life sustaining health care is overwhelmed.

So we need to be careful about any bottleneck in the health care supply chain, not just ventilators. So long as the health care system is overstressed, workers will be prevented from returning to work. This is a basic socio-political reality. I wish Musk understood this. For some reason he is unable to see this from a systems point of view, but is rather narrowly focused on what Tesla needs. A pandemic can be seen as a supply chain problem. Musk needs a supply of healthy workers to turn cogs in the factory, but the systems that secure a health workforces are under enormous stress. He needs to think more about how to relieve bottlenecks in the workforce supply chain. Whatever he can do to prevent or relieve bottlenecks will be greatly appreciated and actually help Tesla get back on track.

This will be an unpopular opinion.

Maybe he sees the shutdown as good for the environment. And as long as all automakers are shut down no one is at any particular advantage so he finally relented. Also, less ppl slows down global warming. This might kill 5% of us. But global warming will kill all of us.
 
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Lots of money at stake with triple witching due to higher than normal volume. Might be quadruple witching today with individual stock options??

The triple is for stock market index futures, index options and stock options. Option writers have a lot at stake today and really want to nail max pain.

I’d prefer having Curt Renz explain but I don’t know if he’s still posting. Explanation below:

Triple witching hour is the last hour of the stock market trading session (3:00-4:00 P.M., New York City local Time) on the third Friday of every March, June, September, and December. Those days are the expiration of three kinds of securities:

The simultaneous expirations generally increases the trading volume of options, futures and the underlying stocks, and occasionally increases volatilityof prices of related securities.

On those same days single-stock futures also expire, so that the final hour is sometimes referred to as the quadruple witching hour.