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It's pretty clear Tesla 2022 production will just about meet Elons expactations from before the covid shutdown in Shanghai. We're chip constrained, any lost production can be caught up throughout the year.

With 2Q almost certainly having a higher ASP than 1Q, what's to worry about? Maybe production will be a bit higher or lower, but there's no more debt to pay off and potentially TONS of S/X in the mix for 2Q.

That's why I've sold all my shares and moved to LEAPs/calls/cash. I think SP goes to $1550 any day now, but if it doesn't I'm still leveraged and have cash to buy more call/LEAPs while we play chicken.

Meanwhile, the TSLA options market will go bananas, with retail investors in the other thread selling BPS all summer making a safe killing. Something's gotta give real soon.
 
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It's pretty clear Tesla 2022 production will just about meet Elons expactations from before the covid shutdown in Shanghai. We're chip constrained, any lost production can be caught up throughout the year.

With 2Q almost certainly having a higher ASP than 1Q, what's to worry about? Maybe production will be a bit higher or lower, but there's no more debt to pay off and potentially TONS of S/X in the mix for 2Q.

That's why I've sold all my shares and moved to LEAPs/calls/cash. I think SP goes to $1550 any day now, but if it doesn't I'm still leveraged and have cash to buy more call/LEAPs while we play chicken.

Meanwhile, the TSLA options market will go bananas, with retail investors in the other thread selling BPS all summer making a safe killing. Something's gotta give real soon.
It would certainly be ironic if Bill Gates being forced to close his short position due to negative public image is what triggers the next squeeze. But we all know fate loves irony.

Many of the BPS crew got killed during the drop caused by Elon selling and then the January crash, so I'm not really sure if I like selling BPS. You can make a killing all year and then be completely ruined by one unforseen event.
 
I think it needed to be Elon talking Taxi to counter Elon talking no 25k car on the Q4 2021 call. Lack of that future volume product was part of the negative narrative.
I actually think the Robotaxi is also the lower cost “$25k model” in disguise (with inflation that $25k in 2024 will be more accurately ~$35k).

2024 is very very close from a product planning perspective - if you were going to launch the lower cost model in 2024 you would have to be finalizing the production plans now for it, and when it comes to tesla it would be very hard for them to spend the 2 years building a production line for a cheaper tesla and not have that be a well known fact. Doing it under the cover of a robotaxi production line is clever.

Now I am not saying that tesla doesnt plan or want a robotaxi fleet starting to be rolled out in 2024 - not at all I think that is a clear goal. However it takes two very big milestones for that to happen:
1.) acceptable FSD to a standard that doesn’t require a driver is achieved
2.) regulators allow deployment of a driverless Robotaxi fleet in large numbers.

Both milestones are very far from being a certainty in 2024. milestone 1 is completely up to tesla to achieve. Milestone 2 is completely out of Tesla’s hands and is political decision rather than one decided on technical measurements, and as such could take many years to come to pass given the entrenched interests.

So I think for tesla the dream is for robotaxi in 2024, but the backup plan is that the high volume production lines and vehicle designs they build for robotaxis are able to easily accommodate a similar $35k smaller Tesla (be it the hatchback or whatever) as well for launch in 2024.

If I had to guess I think 2024 brings driverless robotaxis to boring company built Tunnel-Loops and some small robotaxi friendly markets (so thousands/tens of thousands of Robotaxis built for that) - and hundreds of thousands of a new cheaper, smaller $35k+ model variant being sold.
 
So for a weekend on-topic issue to discuss:

Does anyone else think Q2 2022 could be a down month for TSLA and subsequently a huge buying opportunity?

With Shanghai being shutdown for nearly a month and thus needing to ramp back up, it's pretty safe to think Q2 production numbers will be down from Q1. Maybe not by much, but a good chance they will be less than Q1, especially with Berlin and Austin ramping slowly right now. My gut feeling is Wall Street might use that opportunity to push TSLA down quite a bit in the short term after the June / July timeframe (Q2 earnings).

Now, certainly Q3 production will be record smashing, what with Shanghai back up to speed by then plus Berlin & Austin well into ramping up. And Q4 will be even more record smashing than Q3. BUT, Q2 might be a hiccup along the road to new ATH's for TSLA by the year's end.

Is anyone else thinking this and planning to store some dry powder for a potential mid-summer buying opportunity?
I'm more concerned about missing out on a potential face-ripping rally if the macros turn positive and Wall Street absorbs Q1 earnings numbers and what it means going forward.

To that end, I went the other direction and bit the bullet and bought back some outstanding covered calls. Since I am fully invested, it meant I had to sell a few shares to pay for this. It may have been premature, but FOMO kicked in hard after the earnings announcement and call.

It's just a matter of time. It could happen next week, next month or later. Who knows. But no way am I going to miss the huge rally because I'm trying to be cute with timing. That never works out for me.
 
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Can someone check if there's an overall increase in put positions which is the root cause for the vix spike? I have a feeling that after Netflix miss, lots of puts piled into the market for next week's earnings as they see all of them miss due to similar reasons Netflix faced. This is good as when everyone is piling on for armageddon, we usually have the contrarian rally for maximum pain.
 
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I'm more concerned about missing out on a potential face-ripping rally if the macros turn positive and Wall Street absorbs Q1 earnings numbers and what it means going forward.

To that end, I went the other direction and bit the bullet and bought back some outstanding covered calls. Since I am fully invested, it meant I had to sell a few shares to pay for this. It may have been premature, but FOMO kicked in hard after the earnings announcement and call.

It's just a matter of time. It could happen next week, next month or later. Who knows. But no way am I going to miss the huge rally because I'm trying to be cute with timing. That never works out for me.
Another reason I’m not concerned about Q2 is that even if Tesla just matches Q1 production or even slightly misses, Wall St will still need to up their 2022 EPS estimates because as of right now, it’s still $11.77 EPS for 2022.
 
Ford makes more money on financing and service (parts, etc) than on making and selling cars. This created a weird incentive for them where it made more sense for them to chase increasingly smaller unprofitable niches to generate financing and service activity down the road.

Right now Ford needs to generate profits to keep their books balanced so it’s easy to drop those lines. It won’t even affect their profitability much for the next couple of years, but it will reduce their profits in the coming years.
Your statement has some serious lack of logic. Niche models at low end do not generate any material advantage in service or financing. The marginal cost of making low volume variants such as the three door fiesta simply costs more than the marginal revenue. Niche models only make sense when they have marginal revenue that well exceeds marginal costs. It is true that for most smaller vehicles the top of the line generates effectively all the profits, BUT the bottom of the lien usually generates substantially more than the marginal cost, so absorbs overhead. This is true for most OEM, hence, for example a BMW 316 tends towards fully absorbed loss, but positive marginal cost, while an M340i and similar models, contributes nearly all the profit contribution. However, without the low end models the high end would be too low volume to justify. That Fiesta 3-door probably did not sell enough to justify producing it at all. Tastes change, that is why Ford dropped sedans in the US.

FWIW, that is why Tesla devotes most attention to Model Y and lets Model 3 coast along. Sedans are not the growth area; they're dropping almost worldwide.
 
I actually think the Robotaxi is also the lower cost “$25k model” in disguise (with inflation that $25k in 2024 will be more accurately ~$35k).

2024 is very very close from a product planning perspective - if you were going to launch the lower cost model in 2024 you would have to be finalizing the production plans now for it, and when it comes to tesla it would be very hard for them to spend the 2 years building a production line for a cheaper tesla and not have that be a well known fact. Doing it under the cover of a robotaxi production line is clever.

Now I am not saying that tesla doesnt plan or want a robotaxi fleet starting to be rolled out in 2024 - not at all I think that is a clear goal. However it takes two very big milestones for that to happen:
1.) acceptable FSD to a standard that doesn’t require a driver is achieved
2.) regulators allow deployment of a driverless Robotaxi fleet in large numbers.

Both milestones are very far from being a certainty in 2024. milestone 1 is completely up to tesla to achieve. Milestone 2 is completely out of Tesla’s hands and is political decision rather than one decided on technical measurements, and as such could take many years to come to pass given the entrenched interests.

So I think for tesla the dream is for robotaxi in 2024, but the backup plan is that the high volume production lines and vehicle designs they build for robotaxis are able to easily accommodate a similar $35k smaller Tesla (be it the hatchback or whatever) as well for launch in 2024.

If I had to guess I think 2024 brings driverless robotaxis to boring company built Tunnel-Loops and some small robotaxi friendly markets (so thousands/tens of thousands of Robotaxis built for that) - and hundreds of thousands of a new cheaper, smaller $35k+ model variant being sold.
I suspect there may well be a smaller, cheaper car other than the Robotaxi, for sale in Indian subcontinent, much of the Middle East, all of Central and South America and so on. Much of that part fo the world may not be suitable for robotaxi for a long time. Those smaller cars are the best sellers in most of the world, including China. Obviously those will wait for plentiful batteries, infrastructure, and other factors. That vehicle class is really important but generates very little investor enthusiasm.
 
Your statement has some serious lack of logic. Niche models at low end do not generate any material advantage in service or financing. The marginal cost of making low volume variants such as the three door fiesta simply costs more than the marginal revenue. Niche models only make sense when they have marginal revenue that well exceeds marginal costs. It is true that for most smaller vehicles the top of the line generates effectively all the profits, BUT the bottom of the lien usually generates substantially more than the marginal cost, so absorbs overhead. This is true for most OEM, hence, for example a BMW 316 tends towards fully absorbed loss, but positive marginal cost, while an M340i and similar models, contributes nearly all the profit contribution. However, without the low end models the high end would be too low volume to justify. That Fiesta 3-door probably did not sell enough to justify producing it at all. Tastes change, that is why Ford dropped sedans in the US.

FWIW, that is why Tesla devotes most attention to Model Y and lets Model 3 coast along. Sedans are not the growth area; they're dropping almost worldwide.
Yeah “Niche” maybe not the best of terms.

Tesla makes a few models that serve a broad spectrum of the market.

Ford makes lots of models. Having a broad spectrum of products means their COGS goes up for each model, but the total number of vehicles they sell each year goes up. Since their profits come from financing, many of their cars don’t need to be particularly profitable.

The 3 door Fiesta was not a very profitable vehicle and likely broke even on a good year. But it gave them a portfolio where they could sell cars at a very low price point they couldn’t otherwise reach. Even though they didn’t make money on that car sale, they make money on financing it.
 
It would certainly be ironic if Bill Gates being forced to close his short position due to negative public image is what triggers the next squeeze. But we all know fate loves irony.

Many of the BPS crew got killed during the drop caused by Elon selling and then the January crash, so I'm not really sure if I like selling BPS. You can make a killing all year and then be completely ruined by one unforseen event.
I'm still trading those BPS obtained just before the Elon stock sale, but still making money. To be sure, I'm > 80% HODL but use my options to create some cash.
I actually think the Robotaxi is also the lower cost “$25k model” in disguise (with inflation that $25k in 2024 will be more accurately ~$35k).

2024 is very very close from a product planning perspective - if you were going to launch the lower cost model in 2024 you would have to be finalizing the production plans now for it, and when it comes to tesla it would be very hard for them to spend the 2 years building a production line for a cheaper tesla and not have that be a well known fact. Doing it under the cover of a robotaxi production line is clever.

Now I am not saying that tesla doesnt plan or want a robotaxi fleet starting to be rolled out in 2024 - not at all I think that is a clear goal. However it takes two very big milestones for that to happen:
1.) acceptable FSD to a standard that doesn’t require a driver is achieved
2.) regulators allow deployment of a driverless Robotaxi fleet in large numbers.

Both milestones are very far from being a certainty in 2024. milestone 1 is completely up to tesla to achieve. Milestone 2 is completely out of Tesla’s hands and is political decision rather than one decided on technical measurements, and as such could take many years to come to pass given the entrenched interests.

So I think for tesla the dream is for robotaxi in 2024, but the backup plan is that the high volume production lines and vehicle designs they build for robotaxis are able to easily accommodate a similar $35k smaller Tesla (be it the hatchback or whatever) as well for launch in 2024.

If I had to guess I think 2024 brings driverless robotaxis to boring company built Tunnel-Loops and some small robotaxi friendly markets (so thousands/tens of thousands of Robotaxis built for that) - and hundreds of thousands of a new cheaper, smaller $35k+ model variant being sold.
I still think the 25K (inflation adjusted) car will be the Model 3 built with all the effiencies Tesla can muster. Why create another form factor complicating your lines?
 
I agree, Q2 will be lackluster with "only" 20% growth which will sink the SP for a while.

Thinking you know what the share price of a company as dynamic as Tesla will do in the short-term based upon known challenges in the current quarter and how that will impact the current quarter's results is short-sighted and counterproductive. Known challenges are currently priced in because they are known.

Stocks like TSLA, stocks that are valued for high future growth, will very often move contrary to the most recent results because the valuation is based more heavily upon the longer-term outlook vs. what kind of profits or sales just happened. The only time this does not apply is when current quarter sales/profits have good predictive value for future quarter's sales/profits. And, in this case, Q2 results will not have good predictive value except to the extent that Tesla Shanghai shows an inability to recover quickly (or conversely, they show an amazing ability to bounce back from this challenge as if it were a springboard). A lackluster Q2 was not imposed by Tesla, but by unforeseeable roadblocks imposed on them by unavoidable forces. The value of Tesla going forward from here will be impacted more by how well Tesla handles the impact, not by the fact that results will be impacted.

In other words, Tesla is just as likely to outperform market expectations as it is to under-perform market expectations. Actually, I would argue Tesla (the company) is more likely to outperform market expectations in recovering from this shutdown because they have a long history of pulling rabbits from the hat. If so, we could see considerable upside even with quarterly results that cannot be considered representative of hyper-growth.

Do not under-estimate the potential power of this concept. TSLA (the stock) has a long history of saying "so what" to mind-bendingly good results only to rally on no real news in the coming month or two. The only odd thing going on here is that TSLA is being valued as a typical high growth company rather than the hyper-growth company in hypergrowth industries that we know it to be. And that hypergrowth does not need to present every single quarter for Tesla to be a hypergrowth company. A COVID shutdown is not similar to NFLX's fall off in subscriber growth that has predictive power as to what the trends that impact NFLX's future are doing.

To be clear, I'm not saying I know whether we go up or down from here, I'm saying it's a mistake to think you know based upon events already known to the market.
 
2170s are going into LR and performance Ys
4680s are going into SR model Ys. As of today, there are no LR and performance 4680s.

SR Y will be one of the highest selling skus and this is set to ramp along with 4680s. A 2170 SR Y will most likely fall below 250 miles of range which is not happening (the SR we got in the U.S for a split second had 244mi of range).

So you cannot conclude that 4680s are not keeping up with the ramp when Elon said battery supply is not a problem for 2022. So the ramp for SR Y is going according to their plan. It's speculation to say that 2170 lines are going into Austin due to 4680 ramping problem when LR/P model Ys have year long back logs and there are PLENTY of 2170 packs sitting around which were designed to be inside of a LR/P to begin with.
What is most important here is Tesla can make a Model Y with 4860 or 2170 cells, not how or why it is being done.

But like you I expect 2170s are going into LR and performance Ys.

We don't know if 4680 cells need to be aged beyond the normal "formation" step or how long formation takes.

Most 4680s being used in cars at Austin are from Kato Rd around 2 Million cells.

We know Austin is producing 4680s most of these are probably good.

I admit I don't know much about "formation" or aging cells, in particular I don't know how long it takes.

Or what testing and validation of cells produced at Austin, is needed before they go in cars.

My hunch there are a pile of cells produced at Austin in storage somewhere and production is still ramping.

There is nothing definite to suggest the 4680 ramp is going worse than expected.

Making a performance or LR Model Y with 4680s that is clearly better than a Fremont 2170 model is tricky.

It might be better to cut Fremont over to front and rear castings and a 4680 structural pack at the same time.

2170s might then go into a SR version, at both factories.
 
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Thinking you know what the share price of a company as dynamic as Tesla will do in the short-term based upon known challenges in the current quarter and how that will impact the current quarter's results is short-sighted and counterproductive. Known challenges are currently priced in because they are known.

Stocks like TSLA, stocks that are valued for high future growth, will very often move contrary to the most recent results because the valuation is based more heavily upon the longer-term outlook vs. what kind of profits or sales just happened. The only time this does not apply is when current quarter sales/profits have good predictive value for future quarter's sales/profits. And, in this case, Q2 results will not have good predictive value except to the extent that Tesla Shanghai shows an inability to recover quickly (or conversely, they show an amazing ability to bounce back from this challenge as if it were a springboard). A lackluster Q2 was not imposed by Tesla, but by unforeseeable roadblocks imposed on them by unavoidable forces. The value of Tesla going forward from here will be impacted more by how well Tesla handles the impact, not by the fact that results will be impacted.

In other words, Tesla is just as likely to outperform market expectations as it is to under-perform market expectations. Actually, I would argue Tesla (the company) is more likely to outperform market expectations in recovering from this shutdown because they have a long history of pulling rabbits from the hat. If so, we could see considerable upside even with quarterly results that cannot be considered representative of hyper-growth.

Do not under-estimate the potential power of this concept. TSLA (the stock) has a long history of saying "so what" to mind-bendingly good results only to rally on no real news in the coming month or two. The only odd thing going on here is that TSLA is being valued as a typical high growth company rather than the hyper-growth company in hypergrowth industries that we know it to be. And that hypergrowth does not need to present every single quarter for Tesla to be a hypergrowth company. A COVID shutdown is not similar to NFLX's fall off in subscriber growth that has predictive power as to what the trends that impact NFLX's future are doing.

To be clear, I'm not saying I know whether we go up or down from here, I'm saying it's a mistake to think you know based upon events already known to the market.
I think the next major stock stimulous going forward is the stock split. There are a lot of investors out there that see a $1000 share price as too expensive. A 10-1 or 20-1 split will create tons of interest.
 
C) The stock spilt will be happening right around the time of Q2 P/D and Q2 earnings


Quick point of order- we have no idea when the stock split is happening, nor the split ratio.

We have historical evidence the vote to authorize more shares however is likely to happen around the time you describe. (though it has happened roughly a quarter later the last 2 years)

It's possible we get more details on this in the next 10 days as IIRC the proxy stuff for the meeting must be sent out by May 2nd.

But there's no direct connection between "when they authorize more shares" and "when there's actually a stock split" other than the first one needs to happen first.

One could happen the same week as the other- or they could happen weeks or months apart.
 
I'm still trading those BPS obtained just before the Elon stock sale, but still making money. To be sure, I'm > 80% HODL but use my options to create some cash.

I still think the 25K (inflation adjusted) car will be the Model 3 built with all the effiencies Tesla can muster. Why create another form factor complicating your lines?

Because if many parts of the world M3 form factor is considered too big.
 
Because if many parts of the world M3 form factor is considered too big.
Right - and a smaller car requires less raw material, less weight, perhaps smaller motors, smaller wheels, lower spec features, metal roof instead of glass, less batteries, maybe even a full single piece casting. It all adds up to a cheaper vehicle than can ever be achieved by trying to make the model 3 cheaper.
 
I think the next major stock stimulous going forward is the stock split. There are a lot of investors out there that see a $1000 share price as too expensive. A 10-1 or 20-1 split will create tons of interest.
10-1 or 20-1 ? Why such boring ratios?
I suggest Tesla should do a 420 to 69 split
Just imagine the scrambling of investors + market participants to acquire extra shares to round up their holdings to a multiple of 69, so that they can get the appropriate multiple of 420 instead of cash for fractional shares.
;)