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

[TheTalkingMule]

Why didn’t they murder him 5 years ago, back when his security was weaker and Tesla was in a much more vulnerable position as they attempted to ramp Model 3 production?

Seems like a pretty poor strategy to wait until:

1. Tesla is worth a trillion dollars and is self-funding their own growth with huge free cash flows
2. Elon Musk is critical to NATO peacekeeping objectives in Ukraine and beyond
3. Elon Musk is critical to China’s CCP goals
4. Starship is almost complete and ready to send RosCosmos launch contracting into total irrelevance

Anyone who’s ever gardened knows that it’s easier to take care of pesky weeds before they’ve spread everywhere and dropped hundreds of seeds.

Back in 2010, Germany was just at the point of scaling renewables globally(essentially on their own). Each of their major utilities would soon declare bankruptcy as solar and wind ate into profits and wind/solar started to look really cheap. The guy considered the father of their energy transition was quietly taken out by whomever and died in 2010 "after an unspecified short and severe illness".

He was taken out when things started to get really desperate and inevitability was creeping into the conversation. You could argue the time to take him out was more like when they were ramping effort in 2000, but denial plays a huge role I'm sure.

If anyone's going to kill Elon, it's Russia. Or Russia and the Saudis together. And what was the hurry until now? Until very recently they assumed oil demand would peak around 2045 and very slowly drift down from there.

Now we're here in 2022 and demand has peaked 3 years ago. Putin is in Ukraine keeping oil prices high, and desperation will now start to build industry-wide. Inevitability is the conversation of the day, quite literally on TMC today, and taking out some key players is likely in the discussions whenever MBS, Putin, and the US oil lobbyists chat.

We all need to be watching Elon's ass! No sips of random drinks or food from the buffet. How easy would it be for the world to believe an accidental cocaine overdose next week?

 

[Ogre]

It's pretty clear 2021 was the inflection point. That was the year where most of the industry capitulated. I'm not sure I'd call this a "tipping point", but it was very clearly where most of the industry recognized change was inevitable.

Now it's just a question of the pace of change. Pace is almost certain to be dictated by raw materials and battery supply. Existing players are going to try and forestall a rapid switch over. But Tesla and the close followers (VW, Hyundai, BYD?) have a lot of incentive here to crank up production as fast as possible and start moving down market.

I don't know what people would consider a "Tipping Point" exactly. How much is government pressure really pushing this change right now? Most EV incentives (in the US anyhow) are gone. The laggards are still collecting incentives, but won't be for too much longer.

The worse I see going forward is Tesla has to start releasing more affordable cars to be more price competitive with ICE vehicles. That would be significant margin pressure, but would not significantly hurt the pace of change.

 

[ZachF]

The problem is that the US is the slowest in EV adoption at 29%. Someone posted that tidbit yesterday iirc. And it sure is a downer.

That was a percentage of new car buyers considering buying an EV, and all of the areas surveyed essentially have a larger number considering buying one than the market can supply at this time. This number also continues to grow larger as time goes on.

EVs are still a bit more expensive than gas cars, and the US has an advantage in this area by having much larger disposable incomes than Europe, Japan or China.

 

[TheTalkingMule]

It's pretty clear 2021 was the inflection point. That was the year where most of the industry capitulated. I'm not sure I'd call this a "tipping point", but it was very clearly where most of the industry recognized change was inevitable.

Now it's just a question of the pace of change. Pace is almost certain to be dictated by raw materials and battery supply. Existing players are going to try and forestall a rapid switch over. But Tesla and the close followers (VW, Hyundai, BYD?) have a lot of incentive here to crank up production as fast as possible and start moving down market.

I don't know what people would consider a "Tipping Point" exactly. How much is government pressure really pushing this change right now?

Most EV incentives (in the US anyhow) are gone. The laggards are still collecting incentives, but won't be for too much longer.

I was in a Honda dealership near Philly with someone buying an Insight hybrid(over my objections of course). I asked the salesman why the Insight was being cancelled after this model year and he said because it was basically a Civic hybrid. Implying they now realize they need to electrify the main model lines rather than just try to put out a cute separate offering based on the same platform.

They get it on EVs now. How could anyone at the ground level not? ICE sales are abysmal and everyone's asking them for EVs.

What they don't think is even remotely likely is the end of the dealership model. They actually believe we value their "sales service". That denial ain't never going away until the very end. Which should be here any moment.

 

[Gigapress]

The problem is that the US is the slowest in EV adoption at 29%. Someone posted that tidbit yesterday iirc. And it sure is a downer.

The US has extraordinarily cheap retail gasoline prices, large vehicles, an unusually large rural population for a developed nation, and long distances between most major population centers without good high speed rail options, so people drive. If I’m traveling from Lyon to Munich, I’m probably not going to drive myself, but if I’m going from Los Angeles to San Francisco, I will drive.

With exponential growth and social trends, it’s better to look at leading indicators than population averages. For example, the fashion industry pays close attention to youth trends in certain neighborhoods in NYC, London, Paris etc. because these places have tipping point effects that end up spreading globally as the rest of humanity catches up.

In the major West Coast US metro areas, Tesla and EV adoption has exceeded the adoption rate in other major car markets (Europe, Japan, Australia & New Zealand, S Korea, etc) except in specific cases where heavy government incentives have sped up the process (China, Norway, Holland). Consumer technology trends usually begin in Silicon Valley, San Francisco, Seattle, and their neighbors.

 

[Electroman]

Did I imagine, or was there once a 400 mile range Model S offered by Tesla? I don't see that anymore and the longest range now is 375 miles only?

 

[juanmedina]

Did I imagine, or was there once a 400 mile range Model S offered by Tesla? I don't see that anymore and the longest range now is 375 miles only?

400 miles with the 19" wheels

 

[henchman24]

If the Nasdaq can break out here, the rally may not be on hold.

 

[scaesare]

Additionally, I fear (read expect) that a replacement is already being thought up - tobacco industry fought like heck and then came up with vaping and child attracting flavors, auto industry came up with ‘clean diesel’ and hybrids, and basically have sucked and failed at compelling BEVs in a lot of ways, fossil fuel industry said let’s extract natural gas because that won’t cause any issues, utilities said let’s make up a bunch of bs rules so customers pay through the nose for energy, can’t easily get off the grid, and certainly can’t make their own energy unless we say so and tell them how much and when; behold our regulations!!!

The parallels between the petroleum industry's current tactics as documented in the recent Frontline Big Oil documentary and those of the tobacco companies' actions 40-50 years ago as reported on in the Merchants of Doubt documentary were disturbingly similar.

 

[Gigapress]

Back in 2010, Germany was just at the point of scaling renewables globally(essentially on their own). Each of their major utilities would soon declare bankruptcy as solar and wind ate into profits and wind/solar started to look really cheap. The guy considered the father of their energy transition was quietly taken out by whomever and died in 2010 "after an unspecified short and severe illness".

He was taken out when things started to get really desperate and inevitability was creeping into the conversation. You could argue the time to take him out was more like when they were ramping effort in 2000, but denial plays a huge role I'm sure.

If anyone's going to kill Elon, it's Russia. Or Russia and the Saudis together. And what was the hurry until now? Until very recently they assumed oil demand would peak around 2045 and very slowly drift down from there.

Now we're here in 2022 and demand has peaked 3 years ago. Putin is in Ukraine keeping oil prices high, and desperation will now start to build industry-wide. Inevitability is the conversation of the day, quite literally on TMC today, and taking out some key players is likely in the discussions whenever MBS, Putin, and the US oil lobbyists chat.

We all need to be watching Elon's ass! No sips of random drinks or food from the buffet. How easy would it be for the world to believe an accidental cocaine overdose next week?

Germany has not much sunshine, high labor costs, high environmental review costs (even for environmentally beneficial projects, as Giga Berlin showed), and relatively expensive real estate.

Solar was an order of magnitude more expensive in 2010 than in 2022, and the world was mired in a severe recession and credit crunch that drove up the capital costs for solar, making the economics even worse because solar energy is dominated by upfront expenses.

Now in places like Arizona, Saudi Arabia and Qatar, solar is the cheapest energy of all time. Of all time. Ever. Cheaper than paying people $10/hr to gather sticks, chop wood and build a bonfire. We also have extremely low interest rates which further favors solar over traditional energy architectures.

In 2010 we were decidedly not past the tipping point for renewables, especially somewhere like Germany. In 2022 we are past it. I would estimate that we passed the self-sustaining chain reaction threshold circa 2020. I invested in TSLA and other renewables companies in 2018 with half my life savings to help with that push.

 

[Dig deeper]

Why didn’t they murder him 5 years ago, back when his security was weaker and Tesla was in a much more vulnerable position as they attempted to ramp Model 3 production?

Seems like a pretty poor strategy to wait until:

1. Tesla is worth a trillion dollars and is self-funding their own growth with huge free cash flows
2. Elon Musk is critical to NATO peacekeeping objectives in Ukraine and beyond
3. Elon Musk is critical to China’s CCP goals
4. Starship is almost complete and ready to send RosCosmos launch contracting into total irrelevance

Anyone who’s ever gardened knows that it’s easier to take care of pesky weeds before they’ve spread everywhere and dropped hundreds of seeds.

They didn't kill him 5 years ago because they were to busy laughing hysterically and mocking him, the smug pricks. They aren't farmers even though they claim to be, pretending that shiny tractors make you one. Hubris is a powerful drug.

For those same reasons, they'll fail to compete, they still underestimate him. And like a bad farmer, they'll wait too long to start doing real work and fail at rooting out their (perceived) weeds. These bean counting programs and companies are already dead, the clock just hasn't reached 0 yet. They are zombies.

I'm trying to make your analogies work to make the point but I really hate reasoning by analogies/association.

Also, I want to just say thanks for all your amazing contributions to this forum.

 

[Discoducky]

In 2010 we were decidedly not past the tipping point for renewables, especially somewhere like Germany. In 2022 we are past it. I would estimate that we passed the self-sustaining chain reaction threshold circa 2020. I invested in TSLA and other renewables companies in 2018 with half my life savings to help with that push.

Agree on renewables, but for EVs we are not there yet since Tesla still has such a huge lead, they (legacy ICE) would fold up their plans and go back to full ICE if Tesla were removed from the picture. They know they have a snowballs chance in hell of coming through this transition without losing a ton of their brands, status and just to survive.

I think Elon could only take a step back once 4680s, FSD, CT and Semi are fully ramped and yes, I think the 4 factories humming along will demonstrate EVs are here to stay.

Also, Elon had a 'driver' back in 2014 that I worked with and he was much more than a driver.

 

[Nocturnal]

The parallels between the petroleum industry's current tactics as documented in the recent Frontline Big Oil documentary and those of the tobacco companies' actions 40-50 years ago as reported on in the Merchants of Doubt documentary were disturbingly similar.

Reminds me of the excellent movie, Thank You For Smoking. To those who haven't seen the movie, it involves a lobbyist/PR guy for big tobacco whose job it is to spin smoking into something innocuous. He had weekly lunch meetings with what they called the "Merchants of Death". They were reps from Big Alcohol, Big Fast Food etc.

The fact that execs from Exxon Mobile and the like aren't in front of Congress explaining why they lied about climate change for decades just shows how much more work we have to do.

 

[Ogre]

I was in a Honda dealership near Philly with someone buying an Insight hybrid(over my objections of course). I asked the salesman why the Insight was being cancelled after this model year and he said because it was basically a Civic hybrid. Implying they now realize they need to electrify the main model lines rather than just try to put out a cute separate offering based on the same platform.

They get it on EVs now. How could anyone at the ground level not? ICE sales are abysmal and everyone's asking them for EVs.

What they don't think is even remotely likely is the end of the dealership model. They actually believe we value their "sales service". That denial ain't never going away until the very end. Which should be here any moment.

I see similar dynamics in the high end bike industry. Just a few years ago, manufacturers almost exclusively sold through bike shops. When you are dropping $3,000 - $15,000+ on a high end bike, lots of people want a relationship with the shop they buy from. Bike shops don't have legislation protecting them, but they did have some contracts protecting them.

About 10 years ago, direct to consumer brands started becoming increasingly popular. Brands like YT, Canyon, and others could release a nice bike for 10-30% less than what you'd get from a bike shop and slowly started growing in share. COVID accelerated this change-over quite a bit. Now about 1/4th of the industry is DTC brands. Many of the bigger brands are competing by opening brand owned bike shops in major markets or by offering hybrid approaches. Intense now sells a secondary label called Intense 951 which is their DTC brand while their primary brand is still sold through shops.

The result has shaken up the industry a bit. Poorly managed shops or shops with bad service have struggled, but the bike shops with great service do ok because people still need to have their bikes worked on and upgraded. Even the folks who went with DTC bikes need to get them fixed.

The result is a more competitive industry with better service.

Cars are more expensive and dealership protections are deeper, but this is the way the industry is going. The car dealerships are going to have to get better if they want to survive. Ford and the rest will figure out some hybrid models to replace the existing model. States with deep protections for dealerships will fight it for a few years, but even there it will eventually collapse as people increasingly turn to neighboring states to purchase cars and want service for those vehicles.

 

[Krugerrand]

Why didn’t they murder him 5 years ago, back when his security was weaker and Tesla was in a much more vulnerable position as they attempted to ramp Model 3 production?

Seems like a pretty poor strategy to wait until:

1. Tesla is worth a trillion dollars and is self-funding their own growth with huge free cash flows
2. Elon Musk is critical to NATO peacekeeping objectives in Ukraine and beyond
3. Elon Musk is critical to China’s CCP goals
4. Starship is almost complete and ready to send RosCosmos launch contracting into total irrelevance

Anyone who’s ever gardened knows that it’s easier to take care of pesky weeds before they’ve spread everywhere and dropped hundreds of seeds.

Because they’re people and people are stupid. And 5 years ago Tesla was going bankrupt - read the headlines. Bankruptcy means no Elon problem.

Again, just because something hasn’t happened yet, doesn’t mean it hasn’t been tried, or won’t happen in the future.

It would have been easier if OEMs had gotten on board the EV train 10 years ago instead of stalling and blatantly fighting Tesla.

It would have been easier if we’d all worn masks right off, followed protocols, and gotten vaccinated.

It would have been easier if we jailed every single person involved in the 2008 mortgage scandal.

I can go on all day long what would have been easier. That’s not how a vast majority of people think.

 

[TheTalkingMule]

Germany has not much sunshine, high labor costs, high environmental review costs (even for environmentally beneficial projects, as Giga Berlin showed), and relatively expensive real estate.

Solar was an order of magnitude more expensive in 2010 than in 2022, and the world was mired in a severe recession and credit crunch that drove up the capital costs for solar, making the economics even worse because solar energy is dominated by upfront expenses.

Now in places like Arizona, Saudi Arabia and Qatar, solar is the cheapest energy of all time. Of all time. Ever. Cheaper than paying people $10/hr to gather sticks, chop wood and build a bonfire. We also have extremely low interest rates which further favors solar over traditional energy architectures.

In 2010 we were decidedly not past the tipping point for renewables, especially somewhere like Germany. In 2022 we are past it. I would estimate that we passed the self-sustaining chain reaction threshold circa 2020. I invested in TSLA and other renewables companies in 2018 with half my life savings to help with that push.

Local and regional tipping points are far more complex than just looking at one cost shifting lower than legacy.

2010 Germany was most definitely past their renewables tipping point and it took extraordinary political effort to slow the market down by 2015 or so. I often cite the month of December 2011 in Germany where the feed-in-tariff rate was about to take another big step down and their marketplace installed over 3GW of solar. In one month. That's a lot.

Yes, the FiT was and remains a subsidy scheme that artificially boosts the value of solar production on the grid. But so what? That's precisely what they intended to do, and it didn't really cost much money.

By 2012/13 the tariff was so low the market ground to a halt and Germany quickly shifted to the more traditional large scale auction for sourcing solar and wind.

Anywho.....from 2010 onward IMO nearly the entire world was past the "tipping point" on renewables. Executed efficiently at scale, the wind and solar technology provided electricity at a comparable price to nearly anything in the market. Obviously we've moved even far cheaper since then.

The only thing that stopped Germany from continuing on to greater renewables adoption was grid congestion and corruptions. Tesla will have that solved for them within 5 or 6 years in my estimation and they'll quickly surpass their 100% renewables goal for 2035.

 

[Gigapress]

Agree on renewables, but for EVs we are not there yet since Tesla still has such a huge lead, they (legacy ICE) would fold up their plans and go back to full ICE if Tesla were removed from the picture. They know they have a snowballs chance in hell of coming through this transition without losing a ton of their brands, status and just to survive.

I think Elon could only take a step back once 4680s, FSD, CT and Semi are fully ramped and yes, I think the 4 factories humming along will demonstrate EVs are here to stay.

Also, Elon had a 'driver' back in 2014 that I worked with and he was much more than a driver.

EVs are part of the virtuous cycle chain reaction I’m referring to.

Cheap solar…

—> Strong economic incentive for battery demand because they are complementary goods​

—> Battery production volume growth​

​

—> Battery innovation and economies of scale and consequently lower prices​

​

—> Cheaper EVs and cheaper EV operating expenses as electricity prices fall​

​

—> More demand for electricity​

​

—> Solar innovation and economies of scale (GOTO Step 1)​

 

[Krugerrand]

Look at the switch from horses to ICE, once it reached a tipping point of obvious superiority and affordability there was no stopping it. This is far less of a change and a more apt comparison.

View attachment 810977

Right. But we’re not there yet. Only a handful know EV superiorities and can afford one. Additionally, the variety of EVs available is not there yet nor the number available.

 

[Electroman]

400 miles with the 19" wheels

Thanks. Why they would show the lower range version as default intrigues me. But then the larger size wheel costs more and has a quicker delivery date. Maybe thats the reason.

 

[Usain]

Towing may be the last legitimate use case for light duty ICE trucks. From Teslarati article:

However, towing a 23-foot trailer did come with a range hit. As noted by F-150 Lightning and Tesla owner oneguynick from the F-150 Lightning Forum, he saw about 0.8 miles per kWh during his test, which is a notable difference from the 1.5 miles to 1.8 miles per kWh that the truck exhibited without a trailer. That translated to roughly 50% of the Lightning’s range when towing.

Two things are interesting here:

1. Towing cut his range by about 50%. This is a number I'm starting to see over and over in regard to EV towing.
2. Wow, I had no idea that Lightning was so inefficient. It only gets 1.5 to 1.8 miles per kWh under normal non-towing conditions?

So that bodes well for Cybertruck. I'm sure it will be a much better towing vehicle because of its core efficiency. But for long distance towing, you either need a huge battery pack or you have to be willing to stop a lot.

Long distance towing will be a challenge, even for Tesla. Maybe you could rent a spare battery pack that fits in the bed?