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

[RobDickinson]

Noone:

Elon - Good news everyone, no new products this year but a car half the price of all the ones we sell today coming next year!

 

[Beltsbear]

This year: No CT. No Semi. No Roadster.

Disappointing and quite surprising given that we heard so much noise about Semi delivery to Pepsi this quarter.

Well I don't take the call exactly the way others are taking it. I believe the Semi will indeed start deliveries in small quantities to customers in 2022. The Cybertruck will be produced in 2022, with the initial super low volume production starting near the end of the year. No customers will get CT in 2022. Yes, another delay, but only pushed back a few more months.

 

[TheTalkingMule]

Forward PE is now 83
Current y-o-y growth rate is 87%
TMC = miserable

I don't get it.

 

[MC3OZ]

They’re still expanding the auto business as fast as they can. It’s not like they said, “Actually, we’re not interested in buying every battery that suppliers can manufacture anymore, and we’re done building factories.”

Seems to me like the cars and batteries are just the boring, been there, done that part of the business now. Still immensely important, profitable, and nowhere near final scale. But time to move on to the next vision instead of dwelling on the present.

I certainly don’t begrudge anyone for being frustrated by the unsettled feeling that produces, but I don’t think it’s surprising. Very in character both for the company and for Elon.

I think we will see a compression of the time between a product reveal with estimated prices, and product production.

It is probably counter-productive now to reveal a product years before production, 6-12 months before volume production might make sense, as customers might hold off ordering an alternative product from another carmaker.

So ideally reveal and the ability to order, 6-12 months before production.

It is no longer necessary to try to increase the level of clean transport ambition at other carmakers, most are as committed/worried as they are going to get.

Customers and shareholders can get their hopes and expectations up, and the coming models can be a constant source of speculation and interrogation.

And finally they need to deliver any products already announced, before revealing new ones, or most of them.

Any new factories can initially be for the purpose of producing models currently in production, that is because logistics is the primary consideration and it is far easier to start a new factory with an existing product.

 

[Mark Alset]

As Elon said, people really don't get it (with it=FSD). The $25k car already exists, it just doesn't cost $25k YET. A FSD enabled car will get ~5x as much use when compared to a car without FSD. Models S3XY with FSD ARE the $25k car. Depending on model, they will cost less than $25k, but people won't be able to buy them in the traditional sense. Instead people will buy a multiyear, unlimited (or limited) mileage license to be driven around in the car.

Everyone seems so focused on robotaxis in the literal sense, as if it's a taxi or uber. As others noted above, most people don't want to share a car with a bunch of random strangers. These $25k FSD enabled cars will likely be shared by small groups of "trusted" people (think friends, family, neighbors).

Of course there will also be generic robotaxis, that will cost even less to utilize, but will be just like taxis (i.e. used by random people).

I suspect this is why Elon was so bullish about FSD on the call. The cost to use or "co-own" a FSD enabled Model 3/Y is going to be so cheap, relative to the status quo of owning a car for individual use. This will financially incentivize people to use shared cars on the Tesla network (either with a small pool of "trusted" people, or random people in robotaxi mode). The revenue Tesla will generate, as others have calculated, is bonkers.

It's too bad most people didn't fully appreciate why Elon was on the call. He was on to not-so-subtly emphasize to shareholders than this FSD thing is coming, and will utterly shock the system when its switched on.

Sure cybertruck will be rad, and people are sad, because its delayed. However, their EXISTING car lineup + FSD is going to fundamentally change how we get around, and will not require any new engineering resources beyond what they've already sunk into 3/Y.

 

[buttershrimp]

Gotta congratulate @buttershrimp on his epic Gigapress/ Cybertruck troll.

Troll? It’s not my fault I’m telling the truth about Gigapress start and Elon decided to pump a creepy grocery carrying robot instead. If you are Elon how the hell do you not slam dunk the cyberteuck gigapress start next month? Meanwhile Optimus just staring at me as I take a shower? No thanks Elon, I’m good.

 

[TheTalkingMule]

Don’t take this the wrong way, but solar panels and stationary storage products are pretty much commodity products with limited profitability potential long term. Yes they are big potential markets, but profit margins will be fairly slim.

Auto, FSD, Robotics etc are all potentially very high margin products by comparison and is where the gigantic profits for Tesla will come from.

A car is not a commodity.
Transitioning the entire energy infrastructure of planet is.
Got it.

It's not about manufacturing, selling, or installing energy production. Just like FSD isn't potentially profitable because of making cells.

It's the farthest reaching and most complex undertaking in human history. That's a big market and might even have some opportunities for back end services.

 

[RobDickinson]

Optimus is feeding that video into Dojo, you'll be getting an optimised health plan soon.

 

[Cosmacelf]

And if he is not exaggerating with the Optimus Prime, we will soon have a world that looks like this:
[ ... Animatrix ...]
And I am not sure how I feel about that…

Intelligent robot workers are coming, one way or another. But they'll be specialized. Factory workers won't have emotions or any kind of drive other than what they are meant to do.

I guess people think that emotions and free will will emerge if the AI is sophisticated enough. I very much doubt that. And if they did, the manufacturers would design another AI that didn't have those "features" since they would be dangerous.

 

[lascavarian]

So scrapping the $25k car and comments about hvac as being some day, makes me think that a very large portion of their R&D is now focused on Optimus.

When I saw that giant wiper on the CT, my first thought was that the motor and articulated mechanism would end up in Optimus Somehow.

 

[Sancho]

Please stop trying to correlate daily and weekly moves of the SP to actual fundamentals, product announcements, earnings releases, etc. TSLA is now the largest casino on the planet. An unprecedented amount of options entices vast amounts of speculative behavior on both the long and short sides. Anyone placing a short term bet on TSLA is gambling, period.

But step back just a little, and there really is an investment opportunity underpinning all this gambling. Over the past several years, TSLA SP has been steadily rising as profits rise. Based solely on projected auto sales, the SP should be considerably higher a year from now. If not, the PE ratio will be completely out of whack with profit growth.

On the flip side, please also stop trying to correlate the SP to advances or delays in future products. FSD, Cybertruck, the "25k car", Optimus Bot. None of this matters to the SP, since nobody can put an immediate value on any of it! It's super interesting stuff, but as investors we need to focus on what the profits will be this time next year. When one of these products can be confidently projected to make near term profits, then we can discuss them from an investment perspective.

 

[Cosmacelf]

After the newly leaked prototype pics and video I was hoping for something more positive. At this point it sounds as if they still don't know how to make the Cybertruck.

Correct. Just as they didn't know how to make 4680 cells with dry electrodes a year ago. If it can be figured out, they'll figure it out.

It isn't guaranteed that they'll figure out how to make the Cybertruck cheaply, however. It may end up being a bust, selling 100,000 units a year due to price.

But I trust the brain trust of Tesla to figure out how to keep growing at more than 50% a year regardless of what happens.

 

[mongo]

My take:
Elon was basically asked, "If you don't make the 25k car, how are you going to sell 3 million in 2025?"
And Elon was responding that FSD makes the current products so valuable that demand will exceed production.
A revenue vehicle made by a business magnet.

 

[Singuy]

Forward PE is now 83
Current y-o-y growth rate is 87%
TMC = miserable

I don't get it.

Probably because Nasdaq tried to make a recovery today and got slammed by the Fed. Pre market is deep read. We wanted Intel and Tesla gap up after earnings but didn't. So yeah...looks like lots of short term pain ahead. I am looking at them breaking 900 premarket tomorrow and then gap fill at 843. Hoping for some PT upgrades tomorrow am so it's not that dire.

 

[MC3OZ]

Don’t take this the wrong way, but solar panels and stationary storage products are pretty much commodity products with limited profitability potential long term. Yes they are big potential markets, but profit margins will be fairly slim.

Auto, FSD, Robotics etc are all potentially very high margin products by comparison and is where the gigantic profits for Tesla will come from.

Software products like Autobidder and VPP are also part of the energy eco-system.

The energy market is a big market, and their is a lot of price volatility and sometimes big financial rewards for time-shifting energy and being able to supply energy at times of peak demand.

Solar is a sleeper, in it's current form it is a commodity market, with high competition and low prices, But IMO solar R&D, the potential for newer improved lower priced cells, is far from tapped out. Whether or not Tesla needs to get involved in any solar R&D is another matter, currently there is no pressing need to do this.

 

[Cosmacelf]

If making profits was the motive - which they already do today - Tesla could have been a niche luxury manufacturer just making Model S & Y.

A high profit margin was never the motive, but accelerating revenue (and thus profits) was certainly part of the motive. You can't change the world being a niche manufacturer. Tesla needs to grow by 10x or more to change the world.

 

[vikings123]

Some great numbers reported today. But today totally did not live up to the hype. Pretty much back where we started this morning.

I just wished Elon would't hijack these calls to talk about FSD every time. And now Optimus to. At this point almost nobody cares what he says about the timeline. He's a pretty smart guy. How can he not see that.

Anyone not a Tesla Bull don't believe any of those will happen, in a financial meaningful way at least, inside five years. Actually half of the Tesla Bulls don't believe so either.

I'm more and more convinced Elon's a masochist and thrives on being ridiculed in media.

To be fair a lot of questions had an FSD flavor to them. I honestly think the 3M cars in 2024 was a good question and Elon could have answered it differently, something along the lines of “there is enough demand for our current line up even without FSD and FSD just kicks things into a higher gear”.

I also think all this talk of Optimus is distracting. Let’s get FSD right first and then we can all dream about bots moving parts in a factory. Bots can be a much bigger business than auto just the same way energy has the potential to be bigger business than auto(shrugs).

The questions could have been so much better though….

 

[moa999]

FSD enabled car will get ~5x as much use when compared to a car without FSD

But this is why FSD needs to be split.

A taxi/rideshare FSD may be worth $200k because it's (at least for a short period of time) a competive advantage vs a car using a human driver. At least until all rideshare cars become autonomous, and then the profit will be completed away

But very few individuals are going to pay $200k for a chauffeur feature for their private vehicle.

(And remember Tesla has never promised that they will include Rideshare features or some form of attended charging/maintenance with the current FSD. Could well be another fee, or cut of profits to do that. FSD isn't worth anywhere as much if you still need to put a dumb 'driver' in the front seat to respond to Uber and then program the car)

 

[Big Time]

Forward PE is now 83
Current y-o-y growth rate is 87%
TMC = miserable

I don't get it.

If there is a god, he certainly doesn’t want me to be happy ;P

 

[Singuy]

My take:
Elon was basically asked, "If you don't make the 25k car, how are you going to sell 3 million in 2025?"
And Elon was responding that FSD makes the current products so valuable that demand will exceed production.
A revenue vehicle made by a business magnet.

Yup and that's what institutional investors heard which is not a good answer. FSD needs to be a free call option, not essential to future growth of Tesla's earnings until wide release. Prior to wide release, FSD is nothing but a risk. It's a risk that it may never work or a risk that can be regulated away. There's a reason why people are doing DCA on tesla's future earnings without FSD to justify today's valuations.