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

[Knightshade]

Horse/carriage/wagon replacement was fast in USA (AFAIK), slow in some other areas (WW2 German Army still had millions of horses - wikipedia - "supply train of a 1943 German infantry division employed 256 trucks and 2,652 horses attended by 4,047 men")

It wasn't as fast as some folks imagine even in the US though.... people keep trotting out that famous NYC parade picture (even Tony Seba makes this mistake) while ignoring horses remained in very common use (just not in NYC parades) for decades after that in the US, including through the great depression in the 30s when some folks converted their car carriages back to having a horse pull em because they couldn't afford gas.... google Hoover cart sometime.... and as you note adoption was even slower in much of the rest of the world.

If we're considering rail, insurance, airline or electric utility/grid investments of Buffet, I don't have enough knowledge to pass judgement, but I have a suspicion that enough of Buffet's investments will be affected as to materially affect returns & possibly force actions upon him eg sales, reduce debt. Whether it's a house of cards or the dents will buff (et) out is the question.

One of the points he makes in his letter is because they have so much cash, and FCF, relative to obligations they're able to get much better return on that cash compared to tighter companies forced to keep them in "safe" bonds.

So he seems fine in that regard.

I think he's making a mistake betting on legacy industries without looking out for disruptions.

Again- this is not remotely what is happening

I pointed out examples from both his rail company and his power company where they've been working on stuff to plan for an electric/renewable transition since years before Tesla sold the first model S

While competitors like Union Pacific keep whining it's too expensive to look at any of that.

They're not, themselves, being disruptive (that's risky and expensive- not Buffetts brand) but they're certainly aware of, and planning for, disruptions to their core businesses- far moreso than most competitors.


That's exactly in line with his idea of finding a few well-managed companies and sticking with them- his managers appear aware, and far more willing to make moves, to recognize future changes than others in the same industries- even if they're not rushing all-in to every potentially disruptive tech out there.

 

[MikeAtkinson]

A 0.5 point rise in the 10 year is a disaster for Tesla. It effectively lowers their long term growth rate from 50% to 49.5%..

There is an important point that every commentator I've seen has missed.

The 10 yr treasury yield rises mainly due to inflation (in the short term inflation fears, but long term will not remain high unless inflation is high). Consumer price inflation is mostly due to wage or (commodity) price inflation, which only really occur when there are shortages due to a booming economy. A booming economy is really good for growth stocks, it enables them to grow even faster, especially if they make much of their money from intangibles (software, IP).

In the case of Tesla they are production bound so number of vehicles produced won't increase much in a boom, however software (FSD) will and people will buy higher margin performance and long range variants. So it is likely that their growth rate will increase faster than bond yields, perhaps 5 or 10 basis points for every one basis point of yield increase. Also as cash on hand will be higher than debt, high interest rates are a small net benefit.

 

[lafrisbee]

For the record, I agree that the Aztek was a horrendous styling effort for a vehicle that was neither a car nor a truck.

I loved the look of the Cybertruck from the get-go, and it is both a great car inside with a real truck bed on the back.

The comparison of the two is misplaced IMHO.

The cybernotatruck has a notabed not a bed. A truck bed does NOT have a rolldown roof that stays closed, nor sides that aren't horizontal.
When they ended up engineering the damn thing they stood back and looked at it and didn't see it was a truck any longer. Sure they started out engineering a truck for the truck market. But they Homer Simpsoned it.

And then they knew they had a problem. If it did not look like a truck, walk like a truck, or sounded like a truck then it was not a truck...
So they had to call it a truck. Not just say it was in the truck category.. They had to put the word TRUCK" in the name.
"E-TRUCK" (E meaning Elon or Electricity. Take your pick)..no too many people will think Elon is being self-centered
"Model T" "T" is for Truck...no Model T was taken.
"NotaTRUCK" being honest never works so No, no, not honesty
"CyberTRUCK" Eureka, just enough of a head fake where the "Truck people" will get a little bit of a thought in their heads that, "Hey this can be used as a truck too." Even though... "Cyber" means "not real" to most truck people. as in "he has a "cyber" (air quotes) girlfriend.
It doesn't walk like a truck, or talk like a truck, or eat like a truck, or pollute like a truck... and it can do so much more than a truck.
But let's sell it to one of the largest segments of the auto industry..."trucks."

 

[mejojo]

It's a near mortal lock we'll hit $620 again in the future, it's just not looking likely for another 18+months. Or whenever the next big global downturn happens.

...or the next split....

 

[MikeAtkinson]

We had a Gates-backed startup in PA called Aquion Energy that developed an ugly and heavy 20kWh "aqueous hybrid ion" salt water battery out of all common raw materials. It worked great and was easy enough to manufacture, they just never scaled manufacturing like Elon would. Personally, I'd much rather have one of these in my basement at $10k than two Powerwalls @ $14k.

IMO it's time for Tesla to branch out into technologies more appropriate to stationary storage. Imagine what Elon and team could do for the design and manufacture process of such technologies in just a couple years of work.

Maybe, but I suspect that Elon and team look at all available battery technologies.

Physically larger and heavier batteries have many disadvantages, including higher installation costs and not being suitable for so many properties. LFP batteries use common raw materials, Lithium is common - it is the 25th most abundant element in the Earth's crust.

 

[Thumper]

Just going from memory here, but I believe Fisker was hired to work on the early design of the Model S but for unknown reasons his work was rejected as being unsatisfactory. I think the design we have to day for the S is all Franz whom I would not characterize as a weak member of the Tesla Team.

 

[lafrisbee]

Damn, sometimes you just have to post it hoping the mods have a sense of humor, and to give EVERY ONE OF YOU a joke to tell at the next Tesla gab-fest...
"I sure hope Musk does not get involved in major scandal...because "Elon-gate" could be a drawn out process..

 

[StarFoxisDown!]

Guess we're done climbing for the day.

If you compare the Nasdaq and the Tesla chart for today, so far it's pretty easy to see where they're stepping in to cap rallies. Stock should be trading at least 2.5X the Nasdaq since it's been underperforming the Nasdaq on 3X multiple times over the past two weeks.

Would've liked to see more volume on this bounce but maybe afternoon trading will surprise.

Regardless, just happy to see some decent green today

 

[Rammstein]

Just going from memory here, but I believe Fisker was hired to work on the early design of the Model S but for unknown reasons his work was rejected as being unsatisfactory. I think the design we have to day for the S is all Franz whom I would not characterize as a weak member of the Tesla Team.

I agree! Did you see him with that sledge hammer denting that truck door and then he smashed two unbreakable windows on the Cybertruck. I wouldn’t classify him as weak either.

 

[hobbes]

What the heck is this?
- ramp to drive up so it is for finished cars
- roof only makes sense if car stays there for a while
- hole in base so car can be accessed from below

Return of the battery swap??? Doesn´t make sense after they abandoned it before...
Does anyone have a better idea?

View attachment 639638
(4 min into the video)

Possibly related: Tesla China's move sparks speculation it may support battery swap, a model central to NIO - CnEVPost

Tesla China's business registration recently added "sales of battery swap facilities for new energy vehicles," according to data provider Tianyancha, sparking speculation that it may support battery swap like NIO.

This combined with the ramp in the video above and the fact that Tesla could get subsidies for its more expensive Models in China by supporting battery swap is interesting. Could they technically support battery swap but not actually offer (they are denying "adopt" battery swap) it to try and get the subsidies? Or is it all b.s. ?

 

[2daMoon]

The cybernotatruck has a notabed not a bed. A truck bed does NOT have a rolldown roof that stays closed, nor sides that aren't horizontal.
When they ended up engineering the damn thing they stood back and looked at it and didn't see it was a truck any longer. Sure they started out engineering a truck for the truck market. But they Homer Simpsoned it.

And then they knew they had a problem. If it did not look like a truck, walk like a truck, or sounded like a truck then it was not a truck...
So they had to call it a truck. Not just say it was in the truck category.. They had to put the word TRUCK" in the name.
"E-TRUCK" (E meaning Elon or Electricity. Take your pick)..no too many people will think Elon is being self-centered
"Model T" "T" is for Truck...no Model T was taken.
"NotaTRUCK" being honest never works so No, no, not honesty
"CyberTRUCK" Eureka, just enough of a head fake where the "Truck people" will get a little bit of a thought in their heads that, "Hey this can be used as a truck too." Even though... "Cyber" means "not real" to most truck people. as in "he has a "cyber" (air quotes) girlfriend.
It doesn't walk like a truck, or talk like a truck, or eat like a truck, or pollute like a truck... and it can do so much more than a truck.
But let's sell it to one of the largest segments of the auto industry..."trucks."

I can't get on that bandwagon for the old style at all.

To me, as a person who has owned a lot of trucks over my life, Cybertruck will do everything I want a truck to do. Haul lumber, motorcycles, packages, appliances, and whatever else will fit on the space provided for the bed.

Plus, it will have handy storage compartments on the sides, built-in T-channels and other tie-down points for attaching things, ramp built into the tailgate, and a roll-cover that I might otherwise have paid extra for on an old-fashioned pickup still using the dated 20th century template.

If you want the old-fashioned template, Rivian and others will likely have just the thing for you.

If you look on the bandwagon for Cybertruck, that's me wailing on the Cymbals, or, Cyber-cymbals as it were.

 

[dl003]

Just going from memory here, but I believe Fisker was hired to work on the early design of the Model S but for unknown reasons his work was rejected as being unsatisfactory. I think the design we have to day for the S is all Franz whom I would not characterize as a weak member of the Tesla Team.

He was always late. His designs didn't capture Elon's vision. He might have sabotaged the project even since he was trying to launch his own car. People are so caught up with the promise of SSB and other shiny objects to realize the CEO is a crook. Once the CEO is a crook, everything else will fail. Ask NKLA.

 

[Vad42]

What the heck is this?
- ramp to drive up so it is for finished cars
- roof only makes sense if car stays there for a while
- hole in base so car can be accessed from below

Return of the battery swap??? Doesn´t make sense after they abandoned it before...
Does anyone have a better idea?

View attachment 639638
(4 min into the video)

Almost looks like it could be an elevator for underground Boring tunnel. Almost...

 

[elasalle]

Who ever is paying for GJ's CNBC appearances ... needs to co relate that every time GJ appears on CNBC these days, the SP goes up

 

[Pras]

Up almost 6% so far in March. On pace to finish month at $4000+. I'd be fine if the pace slowed a bit and we ended up at only 1000,

That Gordon Johnson type analysis!

 

[TheTalkingMule]

Who ever is paying for GJ's CNBC appearances ... needs to co relate that every time GJ appears on CNBC these days, the SP goes up

That's the idea. They see it coming and trot him out as part of their capping effort. Do we have anyone we could pay to go on CNBC?

 

[Mike Smith]

There is an important point that every commentator I've seen has missed.

The 10 yr treasury yield rises mainly due to inflation (in the short term inflation fears, but long term will not remain high unless inflation is high). Consumer price inflation is mostly due to wage or (commodity) price inflation, which only really occur when there are shortages due to a booming economy. A booming economy is really good for growth stocks, it enables them to grow even faster, especially if they make much of their money from intangibles (software, IP).

In the case of Tesla they are production bound so number of vehicles produced won't increase much in a boom, however software (FSD) will and people will buy higher margin performance and long range variants. So it is likely that their growth rate will increase faster than bond yields, perhaps 5 or 10 basis points for every one basis point of yield increase. Also as cash on hand will be higher than debt, high interest rates are a small net benefit.

And a booming economy also gives Tesla more pricing power across all their products. That alone counteracts any increase in interest rates on valuation (and the analysts don't know how to value Tesla anyway - they're just discounting a random number).

The only thing it really effects is the growth rate adjusted for inflation. Using the 10 year as a proxy for inflation it drops Tesla's growth rate by the same amount as the increase in the interest rate.

 

[pz1975]

Anyone who takes a bearish position or closes a bullish position in TSLA based on Gordon Johnson’s “analysis” deserves the loss or lost profits that will inevitably follow. It takes about 20 seconds of google research to look up his horrendous prediction history for TSLA.

Gordon Johnson is like a broken clock without any hands - he isn’t even right twice a day.

 

[MikeAtkinson]

https://twitter.com/Tesla__Mania/status/1366420204113125383

Shanghai is authorizing a new 461142.40 square meter land for "New Energy Vehicles Whole-Vehicle Manufacturing" near Giga Shanghai


People familiar with the matter say it is highly likely that Tesla will be acquiring the usage right of this land. http://shtdsc.com/2016/tdjy/wsgg/202103/t20210301_1009641.html…

 

[oldTAVguy]

That's the idea. They see it coming and trot him out as part of their capping effort. Do we have anyone we could pay to go on CNBC?

No, they would have to have the same credentials as GJ, and we don't have anyone (not counting trolls and care bears) that would debase themselves as GJ does.