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

[vikings123]

For 2021, sure it is. Context matters. There’s no way in any mythical place that Tesla announces anything more for India next year. Too much already on their plate and bigger fish to fry first.

The biggest problem with importing cars in India is taxes. Yes they will likely start in India next year and will sell plenty. I have a few friends back home who are itching to buy a Tesla in India. I was chatting with one of them just last night as his current car got flooded and he is in the market to buy a new car. He knows that ICE will be dead soon but has no EV options to speak of. So ICE it is for now for him.

The import taxes will mean that a model 3 that is priced at 45K USD will likely have a OTD price of $90K or thereabouts, yes you pay a lot in taxes. The taxes are reduced if Tesla can setup an assembly plant(I believe merc and BMW already have assembly plants in India) and finally can provide China like prices once they have a local manufacturing plant. Tesla cannot achieve price parity or volume sales until they have a MFG plant in India.

 

[Jack6591]

Battery technology, Full Self Driving, the machine that builds the machine, vertical integration, and long term macro events I don’t think I’ve ever been more positive about Tesla’s future. All things fine and good; the stars are in alignment.

 

[BETA1019]

If you click on the post number, top right of the post, you’ll get a link to that post, like this: Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable

So then you can create a bookmark to that specific post in whatever browser you’re using. Presumably you’d create a bookmark folder for such links.

Thanks!

 

[vikings123]

Any thoughts on moving a margin account from E*TRADE to IBKR? Their margin interest is about 80% less than the former and that itself is a huge selling point of course.

IBKR has tiered margin rates. See link below. I think they offer one of the lowest margin rates in the market. I’ve been very happy with them and although their UX could be better the fact is it works.

BTW, I would caution getting into margin around election season. IBKR has already increased margin requirements which means they are expecting a lot of volatility. I’m personally keeping some cash on the sidelines in case we have another major dip.

Interactive Brokers Margin Rates

 

[H Mak]

Ford is British - it went global with the Mondeo (British car of the world with a French sounding name). Soon you are going to tell me JLR is Indian....

Speaking of JLR, Tesla will overtake them in terms of vehicles sold, if not this year, certainly next. To me this is quite a milestone in terms of Tesla moving up the mainstream ladder. JLR cars are everywhere in the UK.

 

[st_lopes]

Any thoughts on moving a margin account from E*TRADE to IBKR? Their margin interest is about 80% less than the former and that itself is a huge selling point of course.

My employer has a number of restrictions around where I can hold an account (as well as what stocks I can own). Were it not for those... I would have everything at IBKR. They offer the best pricing (especially on options and margin) and the most complete set of research and analysis tools, again at the most competitive rates.

 

[Bet TSLA]

Tesla cannot achieve price parity or volume sales until they have a MFG plant in India.

But, as opposed to real engineering problems, that is the sort of thing that can be fixed with the stroke of a pen. Just replace "has a factory" with "plans to have a factory". If it's what the Indian government wants then they'll figure out how to make it work. Maybe an "environmental exception".

 

[OrthoSurg]

It’s true. I had always said that I would never own an American car. Yet I now own a Model 3, my wife owns a Model 3, I have a reservation for a Cybertruck and 100% of my savings are in TSLA. The Tesla brand cannot be understated.

I invested as much in Tesla as in Bombardier+Nemaska Lithium.
I’m -95% on my QC portfolio.
+250% with TSLA
I will never buy a Quebecois car or company ever again.

 

[dc_h]

The biggest problem with importing cars in India is taxes. Yes they will likely start in India next year and will sell plenty. I have a few friends back home who are itching to buy a Tesla in India. I was chatting with one of them just last night as his current car got flooded and he is in the market to buy a new car. He knows that ICE will be dead soon but has no EV options to speak of. So ICE it is for now for him.

The import taxes will mean that a model 3 that is priced at 45K USD will likely have a OTD price of $90K or thereabouts, yes you pay a lot in taxes. The taxes are reduced if Tesla can setup an assembly plant(I believe merc and BMW already have assembly plants in India) and finally can provide China like prices once they have a local manufacturing plant. Tesla cannot achieve price parity or volume sales until they have a MFG plant in India.

The problem with an assembly plant is the local sourcing requirements and the lack of local sources for an EV. Very chicken and egg problem. No one is better at solving these issues, but getting through local red tape requires time and that can usually be better spent just getting stuff done. Once they have the new 4680 batteries running, they could build a local Tesla Energy / battery plant. Once they've established TE in India, they could assemble stamped parts and get local seats and other components to get over the hump. TE would also give them more political clout, once local jobs are created.

There's a lot of history behind local protectionism. It may be counterproductive, but it is understandable.

 

[mrmage]

I believe they update the driver assist systems too. The brochure I read said nothing about map updates. A few years back it took my local MB dealer two days to update the map of my Mercedes.

But tuning engine, brakes etc? Don't think so.

Edit: Found the blurb online:

More than 50 electronic components in the new S-Class can be updated with new software over-the-air (OTA). These include the entire MBUX infotainment system, the driver display, the driving assistance systems and the MULTIBEAM LED and DIGITAL LIGHT lighting systems. This technology saves the customer time, as he/she does not need to visit a workshop for this purpose. Furthermore, the vehicle remains up to date throughout its lifecycle and is equipped for new features.

Source: The new Mercedes-Benz S-Class | Daimler

That’s quite forward thinking... for 2012 2010 2008.

 

[vikings123]

But, as opposed to real engineering problems, that is the sort of thing that can be fixed with the stroke of a pen. Just replace "has a factory" with "plans to have a factory". If it's what the Indian government wants then they'll figure out how to make it work. Maybe an "environmental exception".

There has been a lot of talk of EV investments and exceptions. The government has said they want all cars to be electric by 2030 but I’m not seeing any way to get there without follow-up actions. Most recently they announced a 4.6B USD incentive for battery manufacturing also a reduction in import tax for batteries. We will definitely need more than that to improve infrastructure and EV manufacturing. IMO the market for two wheelers/mopeds is huge. Maybe they will start with a research center in India and invent the Tesla moped first?

Read more here about the recent announcement from the government: Exclusive: India plans $4.6 billion in incentives for battery makers in electric vehicle push - document

 

[Right_Said_Fred]

Speaking of JLR, Tesla will overtake them in terms of vehicles sold, if not this year, certainly next. To me this is quite a milestone in terms of Tesla moving up the mainstream ladder. JLR cars are everywhere in the UK.

Tesla probably already overtook Jaguar Land Rover this year. JLR sales in Q1 and Q2 of 2020 (calender year, not their fiscal year) were 110,000 and 74,000 cars, just slightly more than Tesla. I don’t expect JLR to have sold 140,000 cars in Q3 and they certainly will not sell 180,000 in Q4.

 

[joh01652]

CNBC has a decent article on Tesla, renewable energy credits, the GHG cap-and-trade market, and how well-positioned Tesla is to capitalize on this growing source of revenue.

Where Elon Musk and Tesla earn real credit 'eating the lunch' of auto competitors

 

[NicoV]

Tesla probably already overtook Jaguar Land Rover this year. JLR sales in Q1 and Q2 of 2020 (calender year, not their fiscal year) were 110,000 and 74,000 cars, just slightly more than Tesla. I don’t expect them to have sold 140,000 cars in Q3 and they certainly will not sell 180,000 in Q4.

The people’s eyes will only open when Tesla sells more cars than BMW or Mercedes. That’s around the 2 million/year iirc. Give it another 3 or 4 years and we’re there.
The crossover will probably be earlier, I think the sales of BMW and Mercedes will go down materially as they get replaced by Tesla’s.

 

[mekberg]

The people’s eyes will only open when Tesla sells more cars than BMW or Mercedes. That’s around the 2 million/year iirc. Give it another 3 or 4 years and we’re there.
The crossover will probably be earlier, I think the sales of BMW and Mercedes will go down materially as they get replaced by Tesla’s.

Two years tops IMO.

 

[Singuy]

Anyone here believes Elon may ask the board to delay his compensation package for this third trench? Is it even allowed? I bring this up because not only does Musk not need it currently but also it's becoming a huge drag on financials since valuation increased 10x but revenue did not increase 10x during similar time.

 

[Congo Line]

CNBC has a decent article on Tesla, renewable energy credits, the GHG cap-and-trade market, and how well-positioned Tesla is to capitalize on this growing source of revenue.

Where Elon Musk and Tesla earn real credit 'eating the lunch' of auto competitors

$560M in 2020 and more in 2021. That’s a lot of ‘free’ net profit.

 

[mrmage]

IBKR has tiered margin rates. See link below. I think they offer one of the lowest margin rates in the market. I’ve been very happy with them and although their UX could be better the fact is it works.

BTW, I would caution getting into margin around election season. IBKR has already increased margin requirements which means they are expecting a lot of volatility. I’m personally keeping some cash on the sidelines in case we have another major dip.

Interactive Brokers Margin Rates

Those are great rates. I’ve avoided using margins other than as needed for options and settlement, but that could tempt me.

One strategy I’ve considered is to lock my current shares within a reasonable range with a collar, then buy more shares on margin using the low end of the collar.

For example, locking some TSLA shares between 370 to 600 until Jan 2022, then buying additional shares equal to low dollar amount of the shares I locked.

Leaves plenty of upside for locked shares, ensures SP drops will not create a margin call, and gives lots more upside with the new shares.

 

[st_lopes]

Two years tops IMO.

This has already happened in North America. Giga Berlin is going to be that catalyst for Europe.

 

[joh01652]

$560M in 2020 and more in 2021. That’s a lot of ‘free’ net profit.

Actually, the article states: "Nelson [CRFA analyst] is estimating $560 million for Q3 and $670 million in credits’ revenue in Q4." Not sure if this is true, but that's what's written in this piece.

This may be the most comprehensive, big-picture, pro-Tesla article I've ever read from CNBC--makes me think they just recently purchased a few million TSLA shares...