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

[StarFoxisDown!]

But it's too dangerous to sell a Tesla there.

Isn’t the Texas government on break? I wouldn’t expect Abbot to say anything about that until there’s something he can actually do about it

 

[thx1139]

I watched the same interview and that's really what you got out of that long interview that covered many topics? Really?

I don't agree with Texas's social policies, but Abbot was doing exactly what a politician should do. He continually mixed business policy and social policy together to muddy the message.

We live in an era of sound bits. Abbot says Elon is for Texas Social policies. That is what is going to be presented.

 

[larmor]

Heard Phil Lebow use an interesting term. Buyers strike. He said he did not want to use it but.... Went on to deny Cathie Wood's speculation however. Buyers strike!

Discussion moved on to ford and F150 plants being closed and reducing shifts. They have a chip problem plus they are not making the vehicles the buyers want. It is related to chips but why.

Annualized production rate was around 18m per year back in April but now the rate is more like 13m. Is this what disruption looks like? Is the chip shortage because the fabs saw this buyers strike coming? Are chips being stockpiled by someone? Love to hear some data from the fabs.

The chip shortage has made the entire car market weird. Used cars are selling for more than new cars, this includes used tesla cars. At this time, there just are not enough EVs available for the average buyer to get into an electric car. That being said, the price point of the Cybertruck is compelling and on par with higher end pickup trucks, the largest auto segment in the US. Really need to see volume production of the cybertruck.

 

[Todd Burch]

My prediction for today's SP. Up...."they" are going to have a hard time keeping a cap on it.

Not Advice......well kinda...but only as much as any random dude on the internet.

As long as volume remains paltry, which it continues to do, my prediction is it will go where the MMs want it.

 

[jeewee3000]

You misread. I posited that Tesla's tech is 10X safer than human and 5X safer than competitor. You would need to argue that the competitors tech, being just 2X safer than human, is good enough. In either case, a regulator is never forcing the industry everyone to buy a Tesla; the competitor always has the option to sell a vehicle to be driven by humans without the questionable autonomy tech.

Now some people have speculated that once autonomy tech becomes 10X safer than human than human driving would be banned. That would take us into to a whole new ballgame because demonstrating that your tech is mere as good (1X) as human would no longer be good enough; it would be banned along with unaided human driving. In this situation, it becomes debatable whether even 2X safer than human is good enough for regulators. Indeed some human drivers could argue that they themselves are 2X safer than the average human driver and ought to be allowed to drive unaided as well. This then would be a tough situation because they would no longer have the option of marketing vehicles for human driving.

Personally, I doubt that governments will ever get to the point where they ban unaided human driving. Market forces will strongly favor the best autonomy tech and it will become ubiquitous without being banned. As they fraction of vehicles on the road with 10X or better autonomy rises, the roads will become incrementally safer, even for hapless human drivers. For example, if you're the only human driver on the road and all other vehicles on the road have autonomy good enough to avoid having an at-fault accident with you, then the only accidents you get into are where you yourself are at fault. So your total risk of having an accident is reduced as the risk from other vehicles drops to zero. So to the extent that even unaided human driving becomes less risky over time and in response to vehicle autonomy uptake, governments have even less motive to ban it and face the ire of a certain segment of autonomy resistant drivers.

So I guess I net out to a position where most governments continue to allow unaided drivers, but hold autonomy tech to a higher standard. Governments will likely want to protect unaided human drivers from accidents with other vehicles where autonomy is at fault. Thus, autonomous tech would need to prove that it can avoid most accidents with other human drivers and especially any at-fault accidents. Also of course, autonomy must avoid accidents with pedestrians, animals and stationary objects. I suspect that any autonomous tech that can achieve this is likely more than 2X safer than human drivers. Indeed any autonomy tech that is merely 1X as safe as human on average is probably less safe than humans in as many scenarios as it more safe than humans. This raises the question, in which scenarios would regulators tolerate an autonomy system that is less safe than human? If the answer is none, then the average safety must be much higher than 1X. Indeed NHTSA looks to be doing some data mining on Tesla data to find out where if any Tesla's autonomy tech might be inferior to human drivers. If they find anything, then Tesla will have to improve upon that and be able to demonstrate superior performance in the future. So nominally I think Tesla needs to be at least 2X safer than human on average just to pass current regulatory scrutiny.

Meanwhile, Ford Blue needs to be able to navigate a bend in the road.

You raise some interesting points bordering on the philosophical.

I've given the transition to fully autonomous vehicles a lot of thought over the years.

I assume full autonomy is guaranteed in the long run, and that it will be forbidden for humans to operate automobiles. (Insert Elon's elevator analogy )

However, I don't believe the transition will be as sudden as some believe. A full ban of human operation of vehicles is far far away, and will require the FSD-tech to be widespread among car manufacturers.

Also before a ban is in order - even in a small(ish) region such as California for example - the ban could quite possibly be imposed per person. I'm imagining the possibility of (at first) imposing "manual driving bans" on convicted drivers in Court (after DUI, road rage, hit-and-run, heavy speeding, causing a heavy collision, etc).

This would be similar to the withdrawal of ones driving licence we know currently, which prevents you from driving for a set amount of time. In severe cases, a permanent driving ban can be imposed by the Court (currently, in Belgium at least, but this is most likely similar in US/EU). Once FSD is available - even in few brands (cough TSLA cough) - the current driving-ban-system can evolve into forcing FSD on certain people (bad drivers), to increase overall safety on public roads.

This would be similar to the "alcohol lock" a Belgian judge can impose upon a heavy drinker, meaning you are only allowed to operate a vehicle equipped with a built-in alcohol test (by exhalation). Said vehicles can only start their engines in case of a negative alcohol test.

The more I think about it, the more logical it becomes: the FSD revolution will start with forced FSD (besides all the voluntary users of course). Then the flywheel can gain speed and one or two decades later the permanent switch can be made to FSD all around.

 

[j6Lpi429@3j]

i am in no hurry for tesla to recognize fsd revenue. Firstly i think doing so before there is regulatory change will look dubious, but secondly its not like they *need* the money right now anyway. Why show all the competitors how profitable autonomy can be before you need to? why give more information on fsd take rates to the competitors than you need to?
Unless you have to sell your tesla stock this year, why be in a hurry for them to recognize this big pile of cash that is currently hidden from casual investors?

 

[ninpb]

EV tax credit/bill has been quiet for a while. First blip in weeks.
Michigan(D) rep talking of point of sale credit, favoring US union with a Sept 15th non-binding deadline.

U.S. lawmaker working on EV tax credit in budget bill to support union jobs

Michigan Democrat Dan Kildee says he wants to "tilt our policies" in favor of union workers.

www.autonews.com

(staring at M3P order page intensely)

 

[j6Lpi429@3j]

also re...enforced FSD.
Economics will fix this. Cost to ensure car with FSD: $1,000. Cost without FSD: $20,000. Problem solved. a de-facto ban on manual car operation. Insurance companies are data focused and not interested in any war between one car company and another. The data will force the change.

 

[StarFoxisDown!]

That's quite a stretch. Abbot is fully on board with whatever the lobbyists tell him. He has exactly zero plans or desire to do anything about it.

Regardless of whether you think Abbot is for or against Tesla, doesn't change the fact that I don't think Texas government is even in session at this time of the year. So there's going to be zero news on anything related to this.

 

[SOULPEDL]

My thinking is partnering with someone like TSMC plus getting significant gov incentives could alter the calculus significantly.

Partner with Intel or AMD, not TSMC is my recommendation. The 60 Minutes show suggested that China could take over Taiwan to own the Chip industry. Chew on that for a while.

 

[Accident]

Isn’t the Texas government on break? I wouldn’t expect Abbot to say anything about that until there’s something he can actually do about it

The next Texas legislative session starts in 2023 with laws taking effect on 09/01/2023.
Texas Gigafactory would have produced +1 million cars before they can sell one directly to Texans.

 

[Tim S]

Regarding chip fabs... our local manufacturer announced in July they will be building a second fab here in upstate NY and expanding construction in their current plant.

Here are some quotes from a local news story...
"GlobalFoundries plans to build a second semiconductor fabrication plant at its Fab 8 campus, an expansion the company says will lead to the creation of another 1,000 jobs and double its manufacturing capacity..."

GlobalFoundries did not say how much it would spend on the second factory - known as Fab 8.2 - or how much the second factory would cost. Generally, such facilities cost $10-15 billion to build and equip...

CEO Tom Caulfield said that the company would now spend $1 billion in upgrades at the current Fab 8 to build out its manufacturing capacity into unused floor space...

In the past, GlobalFoundries has said that it is looking at building a second chip factory, or "fab," in Malta pending a $52 billion federal chip manufacturing subsidy package being promoted by Schumer and the White House, and it was clear from Monday's announcement that that funding would be required to move forward. The House of Representatives must next pass the bill, known as the U.S. Innovation and Competition Act.

Caulfield said the company has begun the planning process for Fab 8.2 — something the company has started and stopped in the past — although he would not discuss a date or timetable for the new factory."

GlobalFoundries to build second chip plant in Malta

GlobalFoundries plans to build a second semiconductor fabrication plant at its Fab 8...

www.timesunion.com

 

[Discoducky]

I've been thinking about the last few years of both Ford and GM and the relative collapse of their sales. I think it mostly has to do with seceding the sedan market to the asian and European markets and focusing on trucks and SUV's. But the pandemic/chip shortage really threw a wrench in things for many reasons.
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But if I dig into it more I think their collapse is going to be even faster than I thought. I think they knew for probably the last 24 months+ they need to make the shift to electric and had been planning their exits, but as we all know this is a very difficult proposition for the legacy car companies. The more they lean into electric, the less they sell on the ICE side.

I believe 2020-2022 were supposed to be the golden years for them selling ICE as they make the transition where they get the remaining max profits out of ICE before customer switch to EV's faster. The goal being the ICE trucks would fund their EV development while they were still in large demand. The chip shortage has devastated this hope though. Even though they are making more per vehicle than ever before they dont have near enough volume to make up the difference. Time keeps going by and Tesla and others hit the mainstream and are seemingly unaffected at the same degree to the chip shortage as the Big 3. So while customers still want their trucks, but they cannot buy them, and the longer they wait the sooner EV trucks get here. Their window is closing to sell vehicles people want...and they cant sell them. Ford as an example lost money last quarter on their actual vehicle production, but was saved by their financial arm. This quarter will be much worse as there are more line shutdowns, so instead of having cash to plow into EV F150 and others, they are bleeding cash given they cannot deliver or make cars without chips.

This has been covered over and over, but honestly the EV tax credit doesn't really help any of the manufacturers. It helps consumers (and me personally if I buy a model Y) save money on the cars, but I dont believe we actually need to stimulate demand for EV's, nor are they too expensive at the moment. Unless Ford and GM raise their prices dramatically to claim the credit for themselves, or they use the credit to get undesirable cars to sell its worthless. All the while Tesla makes 25% GM on each car with no tax credits and an ever growing demand problem. The dealers for the big 3 will likely mark up the vehicles in the near term to keep the credit for themselves.

Finally I have a bet with a friend of mine that one or all of the Big 3 will either file for bankruptcy or be bailed out by 2025. I am somewhat positive the government will bail them out as MI/OH are very important to both political parties. But when we do bail them out its just going to be one big sponsored jobs program because I dont see how propping them up changes their business model. I am always amazed at the bond markets appetite for crappier and crappier loans to companies in the chase for yield, but these bonds will be expensive, which only weighs more on these companies.

Anyways I keep buying Tesla and waiting.

This was a great read, thank you!

TL;DR for my stuff below - Tesla most likely is affected by chip shortages, but way less than legacy.

And just so folks are aware, when any auto maker says 'chip shortage', what they are saying is that there is a shortage of the chips that they currently use on their boards. The automakers typically, if not always, buy their boards from 3rd parties, mostly off the shelf (i.e. no special form or function other than programming for their specific needs).

Chip shortage are due to automakers NOT being able to make running changes to their boards fast enough. Tesla is as they not only make their own boards, but program their chips in-house from the bare metal to application. Which means they can be much more agile when it comes to having supply chain issues with chips. **IF** there are other pin compatible chips, memory, compute, throughput...yata yata, then Tesla could apply FW/software engineering talent to make a running change. I believe they have done this and are much less affected by the global chip supply chain flucuations.

 

[jerry33]

I didn't misread - I said that as long as humans were allowed to drive, regulators should and would approve another companies autonomous tech that was safer than a human even if it was not as safe as Tesla's system. To do anything else would be the same as forcing people to buy a Tesla or be even more dangerous by driving a car themselves rather than use an autonomous system that could double the safety factor.

This is not even a question.

In any event, no other car manufacturer's self driving will be held to the same standards as Tesla will be held to. After all, doing so would harm political contributions.

 

[Artful Dodger]

Partner with Intel or AMD, not TSMC is my recommendation. The 60 Minutes show suggested that China could take over Taiwan to own the Chip industry. Chew on that for a while.

I'm pulling for Samsung (the manufacturer of Tesla's FSD chip) with a new FAB in Austin, TX:

Austin American-Statesman

www.statesman.com

Cheers!

 

[kbM3]

Shanghai took 10 months (in the midst of a pandemic) to hit the Model 3 targeted run rate. Tesla was targeting 250k a year and 5k per week. The first 6 months were only 50k (shutdowns and Covid in general had an impact). I'd think Berlin will be similar, but bigger numbers with the 500k goal from the beginning and hopefully the lack of shutdowns shaves off a month or two. IMO 300k is close to the high end of what to expect from Berlin in 2022 with it heavy in the last 6 months. Q4 probably won't surpass 10-15k. Austin will probably have a bit higher numbers added since it seems they are farther ahead on the Y, and the CT will be produced in 2022 as well. My guess in total ~750k with ~450-500k of that in the last 6 months.

On the flip side, Shanghai Model 3 production was basically a copy of Fremont. Berlin and Austin are both implementing completely new methods of car manufacturing and Elon has previously stated that they will probably run into difficulties.

 

[Knightshade]

Partner with Intel or AMD, not TSMC is my recommendation. The 60 Minutes show suggested that China could take over Taiwan to own the Chip industry. Chew on that for a while.

AMD doesn't have any fabs. They got out of the fab business years ago. They outsource to folks like TSMC.

Intel has fabs- but none capable of making 7nm D1 chips. That's why Tesla appears to have used TSMC for that. Intel had been TRYING to get lower nm process to work for years and years now with poor success... it's why their CPUs kept having to squeeze everything they could out of 14nm process (and now eventually 10 nm)...so I'd be highly reluctant to partner with a company that's shown a terrible lack of progress for a long time now....Intel HOPEs to finally get on a 7nm process in 2023 and not like they haven't been missing target dates for years now.

TSMC and Samsung are the only games in town right now for 7nm (with TSMC a couple years ahead here already on second gen process)

 

[Singuy]

This was a great read, thank you!

TL;DR for my stuff below - Tesla most likely is affected by chip shortages, but way less than legacy.

And just so folks are aware, when any auto maker says 'chip shortage', what they are saying is that there is a shortage of the chips that they currently use on their boards. The automakers typically, if not always, buy their boards from 3rd parties, mostly off the shelf (i.e. no special form or function other than programming for their specific needs).

Chip shortage are due to automakers NOT being able to make running changes to their boards fast enough. Tesla is as they not only make their own boards, but program their chips in-house from the bare metal to application. Which means they can be much more agile when it comes to having supply chain issues with chips. **IF** there are other pin compatible chips, memory, compute, throughput...yata yata, then Tesla could apply FW/software engineering talent to make a running change. I believe they have done this and are much less affected by the global chip supply chain flucuations.

Tesla does not make their own boards except the FSD board (and even then they don't exactly make the board..they just made the board design and the third party fabs everything). Everything else is third party like the infotainment board, and all the micro controller board.

 

[StealthP3D]

The next Texas legislative session starts in 2023 with laws taking effect on 09/01/2023.
Texas Gigafactory would have produced +1 million cars before they can sell one directly to Texans.

Probably Abbot is setting himself up to be the hero with a last-minute executive order allowing cars produced in Texas to be sold in Texas.

Also, ironic that his name is basically "a bot". Autonomous driving should have an easy go of it with a Governor like that!

/s

 

[henchman24]

On the flip side, Shanghai Model 3 production was basically a copy of Fremont. Berlin and Austin are both implementing completely new methods of car manufacturing and Elon has previously stated that they will probably run into difficulties.

I see Berlin and Austin more as an evolutions (sans CT) of Shanghai's Y program. Shanghai is vastly different from Fremont in design of the factory and it was designed that way as lessons learned from the 3 ramp in Fremont. Then the Y program in Fremont added to the Y deployment in Shanghai. The 4680s are not likely to be ready for the initial production ramp, so the biggest differences with Berlin/Austin on the Y side is a front casting. CT is all new, I don't expect that one to go all that smoothly.