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

[SOULPEDL]

Some good reporting from Teslarati here. They reached out to the EPA to check on the status of certification of Austin-made Model Ys. The article is fairly detailed, and explains the EPA's certification process, and why Austin-made Ys need to receive a separate certification (likely changes to the battery pack, or some other change in the vehicle).

It also corroborates what management said on the earnings call in January about the certification being the only hold-up to deliveries, and would seem to confirm that Austin-produced Ys can be delivered once that hurdle is cleared, unlike in Germany where currently-produced vehicles will have to be disposed of/whatever.

So, the race between Austin and Berlin is already over.

Tesla Model Y from Giga Texas is just one EPA approval away from first deliveries

Hundreds of Tesla Model Y all-electric crossovers have been spotted in the lots of Gigafactory Texas in the past few weeks, with some being spotted on haulers to be driven to destinations not known. However, haulers will likely be back soon for another logistics mission: to pick up the...

www.teslarati.com

How close are the EPA and the SEC?

 

[LYTRIDR]

Uhh…. What?

The rise in gas prices were about to see alters the TCO massively in Tesla’s favor.

A model 3 in the US costs about $40/mo in electricity if you drive It the US average of ~1000 miles.

A 28mpg comparable ICE car will use 36 gallons.

At $2.50 per gallon that’s ~$90/mo
At $3.30 per gallon that’s ~$120/mo
At $4.50 per gallon that’s ~$160/mo

With gas prices at $4.50 (which will probably happen soon) you pay $120 per month extra in “fuel”, which translates to ~$7,000 in sales price if financed!

To add to this, it is not only the monthly cost but there are many people who will take into account the volatility of the energy prices.

The pain that people feel at the pump will stay with them and the predictability of electric prices vs the high volatility of gas prices has value as well.

Personally, 6 years ago and well before I took delivery of my Model 3, I put solar on my roof. The volatility of the energy prices was one of the factors I took into account. Another part of my thought process was to reduce my support of petrostates including Saudi Arabia and Russia. It turns out that move was in my best financial interest as well, since the array has now paid for itself, the gas savings vs my previous vehicle has offset completely the depreciation on my Model 3, and I've got decades of use left in my solar array.

IMHO, much that is happening is going to strongly benefit the transition to sustainable energy and Tesla in particular.

 

[thesmokingman]

Then again in California you can just add solar to your home and because of the high electricity prices, this pays for itself in less than 1/3 of its lifetime. We added a 10kW system for $18k after incentives, $25k cash layout initially in 2015. We used to pay $2k/year for electric, now $0. We added three power walls in 2020 to mitigate the change in rate plans (off peak now until 3pm when most solar already happened) which again pays for itself in less than its lifetime. They keep changing the rules but it is possible to sidestep them with investments. We essentially charge our cars for free. My next investment is replacing our gas furnace with a heat pump system.

Yeap, solar for the win in Cali. The funny thing about SCE, they let us continue on our grandfathered TOUDA plan. The main difference is the super off peak is 3 cents cheaper than Prime, however on peak of TOUDA is ridonkulous at 69 cents. With the powerwalls we can avoid the dreaded on peak and draw only at super off peak of 17 cents. It's just hilarious... playing these games with SCE for 3 cents savings.

 

[ZachF]

So many SUVs out there, 28mpg is seems generous.
Moreover, in a two car family, assuming both commute to work by
car, and soon the numbers add up.

1000 miles per month at 20 mpg, that’s 50 gallons, and at $4.5 per gallon
equals $225 per car. $2,700 per year per car.

Median family income, in 2021 is $79,900.

I’m using 28mpg because that’s what an ICE car comparable to a model 3 would get.

You could see gigantic cost savings for something like a Cybertruck vs a 16mpg truck if gas gets to $4.50+ here in the US. Like $200+ per month “fuel” savings!

 

[thesmokingman]

I’m using 28mpg because that’s what an ICE car comparable to a model 3 would get.

You could see gigantic cost savings for something like a Cybertruck vs a 16mpg truck if gas gets to $4.50+ here in the US.

You're being very very generous in that regard. Most SUV get craptastic mileage. The Subaru Tribeca we replaced with a MYP got 15mpg city. Subarus are gas guzzlers, especially the non direct injected ones.

 

[Sudre]

With Tesla's cash and income they certainly can afford to ditch Berlin and simply build elsewhere to replace it. I do not think Tesla is afraid of writing off sunk costs and learning hard lessons with very quick corrective decision making. Even with something as large as a Giga Factory if need be.

We will know when the drone footage starts showing the gigapresses going back on trucks..... LOL

 

[Usain]

Yep.

Why Tesla is outperforming today.

In a month gas will probably be $4.50 and Tesla’s production will be sold completely out to 2023.

And Tesla will be forced to raise prices, which increases margins.

I'll ask again. Does anyone know a web site that tracks Tesla pricing in different locales? If not I might need to start one.

 

[ZachF]

At $4.50 per gallon and 15c per KWh, a $70,000 Cybertruck has the same monthly payment+fuel cost as a $58,000 16mpg ICE truck.

 

[jerry33]

I’m using 28mpg because that’s what an ICE car comparable to a model 3 would get.

Provided you drive it EPA test style.

 

[Usain]

The issue though is that because Tesla is ethical with it's pricing, even if they raised prices today, those price hikes wouldn't really take effect until the very end of this year. Tesla doesn't use the unethical method of "marking up" cars that are on their way to delivery.

Likely though, Tesla is just going to adjust production to push more of the higher trims for earlier delivery.

Agree that Tesla doesn't do the unethical stuff dealerships are doing.

But I do think Tesla will need to raise prices across the board in order to keep wait times under control. This means they will raise prices on the higher trim, quick delivery cars as well. So the effect is the same. A price hike now will raise margins for the rest of the year.

 

[SmokyPeat]

We will know when the drone footage starts showing the gigapresses going back on trucks..... LOL

Zero chance of that. All of the hair pulling here over Giga Berlin is going to look silly in a year or two.

 

[generalenthu]

It is heartening to see a flattish day with huge volume at least so far. This helps digest some of the put gamma / under-hedging that has accumulated over the past few days, and resets the trend of increasing underperformance relative to the macros as we got deeper into the draw-down.

The situation is still pretty dynamic, with again a large macro move causing Tesla to overshoot, but with the increased IVs and a heavy volume day, there seems to be some fuel building up for an upward move. We are in this state of disequilibrium where we cannot stay here for too long.

edit: some readability improvements.

edit 2: This is not an all clear by any means, as macros are still in the drivers seat here.

 

[Singuy]

At $4.50 per gallon and 15c per KWh, a $70,000 Cybertruck has the same monthly payment+fuel cost as a $58,000 16mpg ICE truck.

Even though true, most people are just looking for a justification to get something new. Fear of gas shortages or 5 dollar gallon gas usually is enough to push people over the edge. I mean people flight to one of the most embarrassing cars ever created, the prius when prices were 3k higher than a typical gas car, while ditching their beloved SUVs last time when this happened. So most will irrationally make the jump even when the TCO isn't there (except it's more than there this time with an EV).

 

[Zextraterrestrial]

How close are the EPA and the SEC?

2 or 3 letters apart from each other?
E=E
A-b -C
P-q-r- S
or offices? maybe behind closed doors 'close'

 

[thesmokingman]

Even though true, most people are just looking for a justification to get something new. Fear of gas shortages or 5 dollar gallon gas usually is enough to push people over the edge. I mean people flight to one of the most embarrassing cars ever created, the prius when prices were 3k higher than a typical gas car, while ditching their beloved SUVs last time when this happened. So most will irrationally make the jump even when the TCO isn't there (except it's more than there this time with an EV).

Yea, it just means they will spend more time at Costco to save that 10 cents.

 

[Usain]

Now the race between Giga Berlin and Giga Prague begins…

If they go with the Czech Republic, the factory will be on the other side of the country in Brno instead of Prague.

Brno is known as the Moravian Silicon Valley. Been there many times and it earns that reputation. Lots of talented engineers. Wages and prices are low. And the food is really, really good.

 

[TheTalkingMule]

Some good reporting from Teslarati here. They reached out to the EPA to check on the status of certification of Austin-made Model Ys. The article is fairly detailed, and explains the EPA's certification process, and why Austin-made Ys need to receive a separate certification (likely changes to the battery pack, or some other change in the vehicle).

It also corroborates what management said on the earnings call in January about the certification being the only hold-up to deliveries, and would seem to confirm that Austin-produced Ys can be delivered once that hurdle is cleared, unlike in Germany where currently-produced vehicles will have to be disposed of/whatever.

So, the race between Austin and Berlin is already over.

Tesla Model Y from Giga Texas is just one EPA approval away from first deliveries

Hundreds of Tesla Model Y all-electric crossovers have been spotted in the lots of Gigafactory Texas in the past few weeks, with some being spotted on haulers to be driven to destinations not known. However, haulers will likely be back soon for another logistics mission: to pick up the...

www.teslarati.com

We have two factories producing vehicles they can't sell, both waiting on "any moment" government approvals. How is one "ahead" of the other?

I would argue you're conveniently skipping over the fact Tesla can't even legally transport their product outside the Austin factory walls and sell it! They have to truck it 300 miles to Louisiana to do that.

We don't live in a world of scarcity anymore, both these factories can be amazing.

 

[ItsNotAboutTheMoney]

Even though true, most people are just looking for a justification to get something new. Fear of gas shortages or 5 dollar gallon gas usually is enough to push people over the edge. I mean people flight to one of the most embarrassing cars ever created, the prius when prices were 3k higher than a typical gas car, while ditching their beloved SUVs last time when this happened. So most will irrationally make the jump even when the TCO isn't there (except it's more than there this time with an EV).

TCO isn't there if still have the Prius.

 

[StarFoxisDown!]

We have two factories producing vehicles they can't sell, both waiting on "any moment" government approvals. How is one "ahead" of the other?

I would argue you're conveniently skipping over the fact Tesla can't even legally transport their product outside the Austin factory walls and sell it! They have to truck it 300 miles to Louisiana to do that.

We don't live in a world of scarcity anymore, both these factories can be amazing.

Austin is ahead because every Y currently being produced there can be sold when the EPA certification is approved. It's not the same situation as Berlin.

 

[SOULPEDL]

We will know when the drone footage starts showing the gigapresses going back on trucks..... LOL

With Russia off the greenfield list, who's next, France? Gets there in a day! (I'm biased a little, maybe a comic to some, but it's fairly close and a GigaPress looks pretty heavy to me.) /s