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

[wtlloyd]

OT... I watched one of the last Apollo's leave earth all the way from the west coast of Florida. As a 12yr old, my brain changed that day. I started with my own rockets and models, tools, then figured *sugar* out. Always jealous of my friend who had the complete Saturn V rocket model. Anyway, Tesla and SpaceX both will do the same on steroids! Kids everywhere are gearing up for this new wave.

It's not too late!

Saturn V Skylab Rocket - Estes Rockets

Get your hands on an accurate 1:100 scale reproduction of the Estes Saturn V Skylab rocket! Launch the Estes Saturn V Skylab to heights of up to 400 feet.

estesrockets.com

*Edit: You may not know, but model rocketry has grown up : High Power Model Rocketry Supplies | Advance Model Rockets Kits
I've been to a few launch events out in the Mojave, these things are really something - seems to me you might be living in a place with enough space to support a new hobby

 

[TN Mtn Man]

My housing,fuel, electricity and most things I buy have remained nearly the same Or 3% higher. Only cars and meat have really gone up For us. We now have less meat and Tesla will benefit when we finally spend on a car. No way 2021 had 20% real world inflation just because you find one category higher. Eggs are still $1, milk still $2.30 a gallon. Anyone who wants a job and capable of actual work can get a job around here for $15 an hour starting. The same place where rent can be as low as $600. we are not in a recession when that is true.

I guess this depends highly on where you live (which is true on so many of our discussions on various issues, especially energy). I retired last August and moved cross country. Where I moved from, housing prices have jumped 40% in just one year-that in an area that had already seen high demand for years. Rental prices have skyrocketed, if you can find something. This is partly due to demand, and even more so due to the "eviction moratorium"-property owners got hammered when forced to provide housing to those that refused to pay rent. Now some places are demanding 1 YEAR of rent in advance, on top of skyrocketing rents. Lots of others are no longer renting their property, choosing to sell outright. You can't touch a "decent" apartment for $1000 a month. The area I moved to has seen similar percentage increases in housing costs.

Gas prices went from under $2 a gallon to over $3. Food, nuts. A cheap cut of steak from $4 to nearly $10. Pork chops from <$2 per lb to over $5 at my local store. Milk nearly $3 a gallon. The only thing I haven't noticed a big jump on is chicken. Car prices, INSANE. Used car prices (including Teslas) are even more than brand new vehicles, other companies have massive dealer markups. I think I read that since the start of the pandemic MSRP was up over 20%. We went to our local auto show yesterday, and could only say prices were even worse than I was expecting (and other than staying on top of Tesla prices I hadn't paid attention in a while). I will say, seeing what other manufacturers are asking for their prices, Tesla prices don't seem quite so high any more!

I'm fortunate to have lived in states with some of the lowest electricity prices in the country, due to hydropower generation nearby (BPA and TVA). Or perhaps not to them being nearby, but their prices are good. I grew up in western NY with the Niagara Falls power plants just 20 miles away (Robert Moses)-with some of the highest electricity costs in the nation at the time.

If you're in an area that hasn't seen the impact of high inflation, consider yourself very lucky-a great many are not so fortunate.

 

[jbcarioca]

Technically not a CKD, just as Shanghai wasn't either (btys+mtrs came from Giga Nevada). For Berlin, initially battery packs, motors and drive train, and some accessories and electronics will come from Shanghai. We KNOW this; what we don't know is how fast (and it what order) other oomponents will be localized. Shanghai took two years, Berlin will likely NOT be that fast (permits, culture). So right now, stamping body and paint, plus GA is all that's being done in Berlin.


Tesla uses an adaptation of the CKD approach....




Cheers!

NO, NO, NO I apologize for shouting but this is a bit out of hand. You @Artful Dodger , rarely;y make such errors.
CKD is local assembly of an imported kit that includes all parts, even screws and other fasteners. In all cases major subassemblies are already completed.
Tesla has done that, Model S and X were reassembled as kits at Tilburg. There si typically one reason to have CKD, that is to avoid import duties.

Auto factories more generally are highly variable in vertical integration, with Tesla generally the highest domestic content in both China and the US for most models. Other OEM are often much less vertically integrated. They are NOT using CKD but do have many outside tier 1 suppliers which deliver major components complete. One example from Tesla is the CATL delivery of complete battery packs. Another example from GM is the Chevrolet Bolt that is substantially a LG design and production.

There is NOT a modified CKD with Tesla. They simply have greater vertical integration and models mature.

Please keep the terms straight.

 

[SOULPEDL]

It's not too late!

Saturn V Skylab Rocket - Estes Rockets

Get your hands on an accurate 1:100 scale reproduction of the Estes Saturn V Skylab rocket! Launch the Estes Saturn V Skylab to heights of up to 400 feet.

estesrockets.com

*Edit: You may not know, but model rocketry has grown up : High Power Model Rocketry Supplies | Advance Model Rockets Kits
I've been to a few launch events out in the Mojave, these things are really something - seems to me you might be living in a place with enough space to support a new hobby

Thanks, fun stuff. Still working on Cybertruck, on Box 2/3 now.

 

[FreqFlyer]

I don’t know why YouTubers think they need to have their hands off the wheel to make a FSD video. The right way to monitor is with hands on the wheel so an unexpected steering wheel movement can be countered by tightening your grip instinctually.

Because its "autopilot".

 

[Beltsbear]

I guess this depends highly on where you live (which is true on so many of our discussions on various issues, especially energy). I retired last August and moved cross country. Where I moved from, housing prices have jumped 40% in just one year-that in an area that had already seen high demand for years. Rental prices have skyrocketed, if you can find something. This is partly due to demand, and even more so due to the "eviction moratorium"-property owners got hammered when forced to provide housing to those that refused to pay rent. Now some places are demanding 1 YEAR of rent in advance, on top of skyrocketing rents. Lots of others are no longer renting their property, choosing to sell outright. You can't touch a "decent" apartment for $1000 a month. The area I moved to has seen similar increases in housing costs.

Gas prices went from under $2 a gallon to over $3. Food, nuts. A cheap cut of steak from $4 to nearly $10. Pork chops from <$2 per lb to over $5 at my local store. Milk nearly $3 a gallon. The only thing I haven't noticed a big jump on is chicken. Car prices, INSANE. Used car prices (including Teslas) are even more than brand new vehicles, other companies have massive dealer markups. I think I read that since the start of the pandemic MSRP was up over 20%. We went to our local auto show yesterday, and could only say prices were even worse than I was expecting (and other than staying on top of Tesla prices I hadn't paid attention in a while). I will say, seeing what other manufacturers are asking for their prices, Tesla prices don't seem quite so high any more!

I'm fortunate to have lived in states with some of the lowest electricity prices in the country, due to hydropower generation nearby (BPA and TVA). Or perhaps not to them being nearby, but their prices are good. I grew up in western NY with the Niagara Falls power plants just 20 miles away (Robert Moses)-with some of the highest electricity costs in the nation at the time.

If you're in an area that hasn't seen the impact of high inflation, consider yourself very lucky-a great many are not so fortunate.

While I don't agree on anything but steak and gas.... the point is a recession is pretty much defined as an event where the economy SLOWS because people cant find work and can't buy stuff, forming a self re-enforcing pattern. We are not in a recession at all. Not even a bit. Inflation is not recession. There used to be a term called 'stagflation' where the economy was stagnant and prices rose. We are not in that either. The economy is doing well, but there is inflation. Some people will suffer. That sucks. But that is not a recession.

In a recession, people would not be able to afford Tesla's because their income stopped. People would not be able to afford steak because their income stopped. The problem is TOO MANY people can afford steak and Tesla's. Well I don't think that is a problem myself.

 

[TN Mtn Man]

While I don't agree on anything but steak and gas.... the point is a recession is pretty much defined as an event where the economy SLOWS because people cant find work and can't buy stuff, forming a self re-enforcing pattern. We are not in a recession at all. Not even a bit. Inflation is not recession. There used to be a term called 'stagflation' where the economy was stagnant and prices rose. We are not in that either. The economy is doing well, but there is inflation. Some people will suffer. That sucks. But that is not a recession.

In a recession, people would not be able to afford Tesla's because their income stopped. People would not be able to afford steak because their income stopped. The problem is TOO MANY people can afford steak and Tesla's. Well I don't think that is a problem myself.

I'm not sure how that's relevant, we were primarily discussing inflation and not a recession.

A recession is defined as 2 consecutive quarters of negative GDP growth, IIRC. I'm not sure that definition is a good one in these crazy times. You can have a decrease in the output of goods and services, but due to inflation the value of those goods and services may be up. We have had tremendous "artificial" impacts on the economy, with government flooding the nation with cash, with pandemic related shortages in materials and labor. We have had businesses destroyed due to government ordered lockdowns (not saying they were wrong). Millions living rent and mortgage free, while others are forced to provide them housing without compensation. Nothing new here-my only point is that we're in uncharted territory with so many economic and production issues impacted by both the pandemic and government interference in the free markets. In short the "usual rules" likely won't apply and I question how much of history we can apply to what we're seeing now and over the next year or two. It's going to be interesting. Of course, I'm relating this to what I'm familiar to in the US-given the international membership of this forum, I'm sure the situation is different in other areas, as it differs radically in different states in the US.

 

[Beltsbear]

I'm not sure how that's relevant, we were discussing inflation and not a recession.

A recession is defined as 2 consecutive quarters of negative GDP growth, IIRC. I'm not sure that definition is a good one in these crazy times. You can have a decrease in the output of goods and services, but due to inflation the value of those goods and services may be up. We have had tremendous "artificial" impacts on the economy, with government flooding the nation with cash, with pandemic related shortages in materials and labor. We have had businesses destroyed due to government ordered lockdowns (not saying they were wrong). Millions living rent and mortgage free, while others are forced to provide them housing without compensation. Nothing new here-my only point is that we're in uncharted territory with so many economic and production issues impacted by both the pandemic and government interference in the free markets. In short the "usual rules" likely won't apply and I question how much of history we can apply to what we're seeing now and over the next year or two. It's going to be interesting.

Yea, now you turned this political and I am going to bow out.

 

[Artful Dodger]

NO, NO, NO I apologize for shouting but this is a bit out of hand. You @Artful Dodger , rarely;y make such errors.
CKD is local assembly of an imported kit that includes all parts, even screws and other fasteners. In all cases major subassemblies are already completed.
Tesla has done that, Model S and X were reassembled as kits at Tilburg. There si typically one reason to have CKD, that is to avoid import duties.

Auto factories more generally are highly variable in vertical integration, with Tesla generally the highest domestic content in both China and the US for most models. Other OEM are often much less vertically integrated. They are NOT using CKD but do have many outside tier 1 suppliers which deliver major components complete. One example from Tesla is the CATL delivery of complete battery packs. Another example from GM is the Chevrolet Bolt that is substantially a LG design and production.

There is NOT a modified CKD with Tesla. They simply have greater vertical integration and models mature.

Please keep the terms straight.

Meh, you're barking up the wrong tree. It was Phil LeBeau of CNBC back in 2020 who coined what Telsa was doing with initial production at Shanghai as being a "complete knockdown kit" (I knew the difference when he said it). If you want to argue sematics, he's your man.

What you haven't done is acknowledge the correction to your assumption that adding GA lines in 2022 would increase Tesla's total production. I'm not the only one who has pointed out your error:

New factories are not a zero sum game.

In the short term, it is zero sum due to part shortages. Though, the sum is increasing.

Tesla's total production volume in 2022 will be constrained by parts availability. Adding more GA doesn't increase production. (again as pointed out by @mongo, Tesla was ALREADY supply constrained in 2021 with just two factories).

Hope you have a great weekend.

Cheers!

 

[Knightshade]

[/QUOTE]

What you haven't done is acknowledge the correction to you assumption that adding GA lines in 2022 would increase Tesla's total production.

So you believe production in China and CA will decline by a couple hundred thousand cars if Berlin/Austin build a couple hundred thousand this year?


Because that's the only way your zero sum claim adds up.

 

[kanweg]

Weekend OT.

Lex Friedman interviewed Jim Keller, who worked at Tesla.

full interview:

nice clip on Elon and first principles:

https://twitter.com/x/status/1489949644209762316

 

[S3XY]

So you believe production in China and CA will decline by a couple hundred thousand cars if Berlin/Austin build a couple hundred thousand this year?


Because that's the only way your zero sum claim adds up.

It would have to given the same supply constraints.

 

[TN Mtn Man]

Yea, now you turned this political and I am going to bow out.

No, I've specifically avoided turning this political. That would include a judgement or opinion as to rather those actions were good or bad, helpful or harmful. I specifically avoided that. Simply stating facts and events is not political. My point is that due to these issues, normal or traditional economic responses or expectations may not apply.

 

[MXWing]

Tesla's total production volume in 2022 will be constrained by parts availability. Adding more GA doesn't increase production. (again as pointed out by @mongo, Tesla was ALREADY supply constrained in 2021 with just two factories).

Hope you have a great weekend.

Cheers!

So you believe production in China and CA will decline by a couple hundred thousand cars if Berlin/Austin build a couple hundred thousand this year?


Because that's the only way your zero sum claim adds up.

I have a feeling this argument can run all weekend. Hoping we agree to at least this:

Rank the probable outcomes from last to most likely:

Berlin / Austin takes away production from Fremont/Shanghai so net negative.
Berlin / Austin doesn't increase production without taking the same production from Fremont/Shanghai. Zero sum.
Berlin / Austin makes massive vehicles on their own in 2022. Huge net positive production.
Berlin / Austin produces slightly more cars due to more bases to optimize existing supply chains in 2022. Positive contribution to production and delivery ceteris paribus (all other things being equal)

Quantified contributions? I don't think anyone actually knows.

 

[TheTalkingMule]

Can you explain more why you think oil prices will drop that dramatically and what is the cause of current prices?

Global demand for crude oil peaked in 2019.
Demand within the #1 market for crude oil (U!.....S!......A!) peaked in 2018.

On a global scale, crude has been dramatically and permanently oversupplied since 2015. US fracking had increased supply 30+% and showed clear ability to keep building supplies all the way through a peak demand that back then was assumed to come around 2027. In this environment, the Saudis realized they'd lost their role as "swing producer" and would need more players to keep prices high from here on out. They hunkered down with some hedge fund managers and now the only price rises prior to the pandemic were manufactured by a combination of OPEC+Russia+Wall Street.

Now we have a "reopening trade" from Wall Street that's driven WTI to $92 at the same time global logistics are a mess. Once those logistics are sorted out and market players start delivering more crude in a rush to take advantage of these prices, the bottom falls out.

US frackers are selling every oil futures contract they possibly can at profitable levels of $70+ and will be flooding the market with these deliveries from here til god knows when. As of now they're producing at about 11.5Mb/d, down from 13.5Mb/d pre-pandemic. What do we think happens when this logistics logjam eases in 3-5 weeks? US production goes back to 13+Mb/d and our imports go negative.

AND the Saudis are boosting OPEC production in February
AND the Russians will likely pump every barrel they can, even beyond their OPEC agreements
AND Iran will make headway on a renewed nuclear deal

Meanwhile.....demand hasn't even recovered to pre-pandemic levels and is unlikely to ever do so.

Oil is not going to $20 this summer unless there is a catastrophic recession in the world economy.

See all the notes above. TSLA investors need to be mindful that just before (or perhaps during or a bit after) this pandemic we will have crossed the tipping point on peak global oil demand. That's why oil traders, who very well know this, won't be buying 1yr or 2yr out oil contracts at $90 this June. Or perhaps ever again.

We're shifting from fossil-based scarcity to renewables(and storage)-based abundance. That's why we won't see a recession. Energy prices should absolutely collapse a couple months after the pandemic eases in March/April. Commodity prices will come down with it.

We have TONS of job openings with an unwilling workforce. All during a period of free money, record corporate cash, AND easily deployed renewable energy that's far cheaper than what's in place. That's all absurdly stimulative. Our concern should be inflation due to massive excess money supply, but fortunately there will be no scarcity to go with it so it should moderate itself. As we're already seeing.

You need scarcity for inflation and scarcity is literally over.

 

[StarFoxisDown!]

I'm not sure how that's relevant, we were discussing inflation and not a recession.

A recession is defined as 2 consecutive quarters of negative GDP growth, IIRC. I'm not sure that definition is a good one in these crazy times. You can have a decrease in the output of goods and services, but due to inflation the value of those goods and services may be up. We have had tremendous "artificial" impacts on the economy, with government flooding the nation with cash, with pandemic related shortages in materials and labor. We have had businesses destroyed due to government ordered lockdowns (not saying they were wrong). Millions living rent and mortgage free, while others are forced to provide them housing without compensation. Nothing new here-my only point is that we're in uncharted territory with so many economic and production issues impacted by both the pandemic and government interference in the free markets. In short the "usual rules" likely won't apply and I question how much of history we can apply to what we're seeing now and over the next year or two. It's going to be interesting.

You're right.......the usual rules don't apply and do need to be thrown out....and that's why everyone needs to stop listing out their personal anecdotal evidence as evidence of how the broad economy is doing because the fact is, it's just anecdotal.

Just the dynamic of remote work in the tech field/workforce....ya know the workforce that has highest impact per capita on GDP because of how much discretionary spending they contribute to the economy, is having massive deflationary forces. Deflation that is NOT going to show up in the traditional metrics of the economy. Just some of the many deflationary forces of remote work for tech workers:

- No longer commuting. Not spending money on gas, monthly parking spaces in the city, not eating out for breakfast/lunch/dinner
- In some cases, couples are ditching the 2nd car because it's no longer needed
- Not having to pay for child care/day care
- Ability to move to much cheaper cost of living locations while maintaining high salaries and RSU stock compensation
- Migration out of tech has meant city living has become cheaper. Rents in Seattle, San Fracisco, and other big tech cities are still lower than 2019. Apartments are still offering concessions just to get people to rent, even today.
- Meanwhile, salaries and bonuses in the tech field right now are very high because of the high competition amongst employers.

Coupled together, the average tech worker is spending way less on their monthly total costs than they did 2 years ago while at the same time, they're getting all time high salaries and bonuses. Inflation could rise 15% and it still wouldn't mean that much to this group of America because of those other deflationary forces.

Now I'm not saying everything is rosy for the average American. It's not. There's going to be pain for some, while others flourish. But the group that is going to flourish, especially the tech workforce, are the one's that have the most impact on the actual economy when it comes to contribution to GDP and the economy and it's not even close. The upper middle class of America has a very disproportional impact on the economy. Really there's nothing left to do but sit back and watch the next 3-6 months and we'll see who's right

 

[Silent Ludicrosy]

One thing I've noticed is that it's pretty easy to knock it out of FSD on turns. It seems the amount of force required is lower than straight-a ways. And even when driving straight there are occasions where the wheel will jerk unexpectedly. But overall I agree. They shouldn't have their hands on their lap. At least hover over the steering wheel.

There’s definitely some technique to it. In low speed driving I tend to let the wheel slide through my hand to avoid accidental disengagements. Then all I have to do is tighten my grip if it starts swerving toward an obstacle. This wouldn’t work for a yoke though. At higher speeds, the steering wheel turns less abruptly so it’s not an issue.

 

[StarFoxisDown!]

Global demand for crude oil peaked in 2019.
Demand within the #1 market for crude oil (U!.....S!......A!) peaked in 2018.

On a global scale, crude has been dramatically and permanently oversupplied since 2015. US fracking had increased supply 30+% and showed clear ability to keep building supplies all the way through a peak demand that back then was assumed to come around 2027. In this environment, the Saudis realized they'd lost their role as "swing producer" and would need more players to keep prices high from here on out. They hunkered down with some hedge fund managers and now the only price rises prior to the pandemic were manufactured by a combination of OPEC+Russia+Wall Street.

Now we have a "reopening trade" from Wall Street that's driven WTI to $92 at the same time global logistics are a mess. Once those logistics are sorted out and market players start delivering more crude in a rush to take advantage of these prices, the bottom falls out.

US frackers are selling every oil futures contract they possibly can at profitable levels of $70+ and will be flooding the market with these deliveries from here til god knows when. As of now they're producing at about 11.5Mb/d, down from 13.5Mb/d pre-pandemic. What do we think happens when this logistics logjam eases in 3-5 weeks? US production goes back to 13+Mb/d and our imports go negative.

AND the Saudis are boosting OPEC production in February
AND the Russians will likely pump every barrel they can, even beyond their OPEC agreements
AND Iran will make headway on a renewed nuclear deal

Meanwhile.....demand hasn't even recovered to pre-pandemic levels and is unlikely to ever do so.


See all the notes above. TSLA investors need to be mindful that just before (or perhaps during or a bit after) this pandemic we will have crossed the tipping point on peak global oil demand. That's why oil traders, who very well know this, won't be buying 1yr or 2yr out oil contracts at $90 this June. Or perhaps ever again.

We're shifting from fossil-based scarcity to renewables(and storage)-based abundance. That's why we won't see a recession. Energy prices should absolutely collapse a couple months after the pandemic eases in March/April. Commodity prices will come down with it.

We have TONS of job openings with an unwilling workforce. All during a period of free money, record corporate cash, AND easily deployed renewable energy that's far cheaper than what's in place. That's all absurdly stimulative. Our concern should be inflation due to massive excess money supply, but fortunately there will be no scarcity to go with it so it should moderate itself. As we're already seeing.

You need scarcity for inflation and scarcity is literally over.

I agree with most of this post, especially the demand/supply equation being an artificially created thing. But I think it will take more time for oil prices to collapse. Probably in the 4th quarter of this year.

Which I actually don't mind. Artificially high oil prices drive more and more demand to EV's

 

[Ipcress]

OT... I watched one of the last Apollo's leave earth all the way from the west coast of Florida. As a 12yr old, my brain changed that day. I started with my own rockets and models, tools, then figured *sugar* out. Always jealous of my friend who had the complete Saturn V rocket model. Anyway, Tesla and SpaceX both will do the same on steroids! Kids everywhere are gearing up for this new wave.

I had the Estes Saturn 1B. Heady stuff!

 

[Rarity]

They are. This is the tunnel exit/entrance. People don’t seem to know that Loop is a hybrid system with underground tunnels, but using existing above ground infrastructure for stations. So the Resorts World expansive above ground parking lots and drive through front lobby area will be leveraged for the Resort World station. Loop can do this because it uses Tesla electric vehicles which can go through tunnels and drive in unprotected surface streets using Autopilot.

I get so tired of people (not you, others) snarking that a rail system like a subway is superior when they have no idea how Loop even works.

I only disagreed with this because there are multiple front lobbies at Resorts World and Loop will be using the one underground as its "station."

But as you state, the underground is connected to the above ground via a road network and therefore in the future all of the Loop Teslas could drive on unprotected surface streets using autopilot.