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

[henchman24]

That's not really a fix.

I mean... it fixes the issue.

If I'm right and that ends up being the case, it will be a huge black eye for Ford. Not nearly as bad as the Bolt battery issue, but pretty bad look.

On the overall market, we are now ~1% below the Nasdaq's 200 week MA and SP500 is ~2% below 150 week. If there is a bounce to be had prior to the 250 week/200 week tests it is roughly here. If we are to test those, another ~5% to go.

 

[StarFoxisDown!]

Don't worry. GM has lowered the pricing of the Bolt, so it will all average out.

Seriously, what I expect to happen soon, if not already occurring, is for all ICE auto manufacturers to be lowering their car prices. No sane person in this economy with >$5/gallon gas is buying a Cadillac Escallade or a Chevy Suburban. Look what happened during the 1979 oil crisis. It obliterated the US domestic car market of oversized gas guzzlers, and broke open the market for small compact cars from Japanese rivals which up until then had been laughed at. Here we are in 2022 in exactly the same scenario, another oil crises, except instead of oversized gas guzzlers being replaced with small compact cars, they will be relaced with BEVs which up until now have been laughed at. The oil and gas industry is playing Russian Roulette, and ironically in their quest for profits in their declining industry, they have significantly expediated their own demise. Give it some time to play out. Time is on our side.

The oil/gas industry has sped up the ev transition and especially the mindset transition of the population faster than any politician or government could have done. All because of their greed and arrogance. If oil had any brains right now, they’d be doing everything they can to increase production enough to prevent prices from reaching demand destruction and causing the mindset of the masses to accept EV as the future. But that ship has sailed now. They’ve permanently cemented EV’s as the desired product going forward. And it’s going to happen faster than they ever could have imagined (thanks to Tesla of course)

So bravo big oil, you succeeded. I sure hope the profits you’re making right now are worth your industry crating starting in 3-4 years

 

[AndrewZ]

High oil and gas prices now are a consequence of the push away from fossil fuels and are part of the demand destruction required to achieve the transition.

This idea that we’ll have a world awash in cheap oil and still seamlessly transition away from cheap oil is detached from reality. For us to move away from oil and gas, the alternative needs to be financially beneficial. If companies start pumping more oil and prices decrease, that will only serve to extend their use.

 

[StarFoxisDown!]

High oil and gas prices now are a consequence of the push away from fossil fuels and are part of the demand destruction required to achieve the transition.

This idea that we’ll have a world awash in cheap oil and still seamlessly transition away from cheap oil is detached from reality. For us to move away from oil and gas, the alternative needs to be financially beneficial. If companies start pumping more oil and prices decrease, that will only serve to extend their use.

That’s not how transitions work at all. I’d suggest you go though the history of major transitions in different sectors and industries that have happened throughout history. When the inflection point is reached, there’s no turning back. And no, high oil prices are NOT a result of push away from fossil fuels. That’s a media narrative being pushed that doesn’t align up to facts. The facts are oil producers, especially here in the US, could be producing more. They’ve chosen not to and to not make any future investments either.

Also, given oil is by far the main driver of this inflation run that hits every part of the supply chain, when oil goes down, prices of EV’s will go down in relation. EV’s will always be financially beneficial against ICE. They were back when oil/gas was much cheaper. The difference is now, gas prices are making the average consumer much more aware of the financial benefits

 

[Gigapress]

That’s not how transitions work at all. I’d suggest you go though the history of major transitions that have happened throughout history. When the inflection point is reached, there’s no turning back. And no, high oil prices are NOT a result of push away from fossil fuels. That’s a media narrative being pushed that doesn’t align up to facts. The facts are oil producers, especially here in the US, could be producing more. They’ve chosen not to and to not make any future investments either.

Also, given oil is by far the main driver of this inflation run that hits every part of the supply chain, when oil goes down, prices of EV’s will go down in relation. EV’s will always be financially beneficial against ICE. They were back when oil/gas was much cheaper. The difference is now, gas prices are making the average consumer much more aware of the financial benefits

@AndrewZ is the same account that’s been posting about how Tesla customers are getting “boned” by the current prices and criticizing investors for being happy about the current gross margins. He can go buy a Lyriq which looks “frigging good” in his opinion. Nothing useful in the entire post history and it appears to be yet another troll account whose primary purpose is to advertise for competitors and spread baseless Autopilot/FSD FUD that seems believable to a passing observer.

I just have him on my Ignore list, and I set someone to Ignore because of useless posts, not constructive criticism or bearish opinions.

 

[Gigapress]

I believe key raw material/parts contracts have a clause that allow pricing to go up and down within a band based on commodity price movements.

My intuition agrees with this. Do you or anyone else have hard evidence that this is so? I’m wondering if that’s buried in the 10-Q or published supplier contract announcements or something.

 

[AndrewZ]

@AndrewZ is the same account that’s been posting about how Tesla customers are getting “boned” by the current prices and criticizing investors for being happy about the current gross margins. He can go buy a Lyriq which looks “friggin amazing” in his opinion. Nothing useful in the entire post history and it appears to be yet another troll account with nothing useful to add.

I just have him on my Ignore list, and I set someone to Ignore because of useless posts, not constructive criticism or bearish opinions.

You don't believe people are getting "boned" by these price increases? So you think runaway demand relative to supply driving up inflation isn't hurting consumers by increasing prices far beyond reason while adding nothing of value to the product itself?

You don't think the Lyriq looks cool as heck?

There's no doubt that I'm here to be a contrarian voice and that's more pronounced in this thread specifically, less so in other parts of this forum, but the thumbs up below my username suggest some usefulness to the posts.

 

[StarFoxisDown!]

You don't believe people are getting "boned" by these price increases? So you think runaway demand relative to supply driving up inflation isn't hurting consumers by increasing prices far beyond reason while adding nothing of value to the product itself?

You don't think the Lyriq looks cool as heck?

There's no doubt that I'm here to be a contrarian voice and that's more pronounced in this thread specifically, less so in other parts of this forum, but the thumbs up below my username suggest some usefulness to the posts.

Lol the fact that you're talking points immediately fit right to what @Gigapress just said is pretty damn funny. Maybe take some time to create new carebear bullet points?

 

[wtlloyd]

My intuition agrees with this. Do you or anyone else have hard evidence that this is so? I’m wondering if that’s buried in the 10-Q or published supplier contract announcements or something.

I highly recommend "The Global Lithium Podcast" and "The Northern Miner Podcast" for critical materials perspective. Both those sources have recently stated that even without contract statements specifying price adjustment, it is the common practice to accept adjustments when the price differential becomes unbearable.

 

[AndrewZ]

Lol the fact that you're talking points immediately fit right to what @Gigapress just said is pretty damn funny. Maybe take some time to create new carebear bullet points?

*your

Of course my talking points immediately after Gigapress' quote are addressing what was quoted. Quoting someone and then going off on a totally unrelated tangent while ignoring the quoted content, now that would be strange.

 

[Rarity]

Damn... maybe after they do some gambling in Vegas they'll change their minds!

It's amazing how people still underestimate Musk and how profitable it is for us to take advantage of that underestimation.

 

[The Accountant]

My intuition agrees with this. Do you or anyone else have hard evidence that this is so? I’m wondering if that’s buried in the 10-Q or published supplier contract announcements or something.

From the Q1 2022 earnings call (see my bolded excerpts):

Zach Kirkhorn: (16:52)
Yeah. Just to add to what Elon is saying. There’s different ways to calculate raw material exposure. I think a simple way, we estimate more around 10 to 15% of our cost structure exposed to raw materials. And just to clarify a couple of things on that. So we’ve been experiencing increases in costs in general, but also raw materials for a number of quarters now. That pace picked up in Q1, so last quarter. And what we’re seeing for Q2 is slightly higher than that as well. And as indices move, it doesn’t impact us immediately or directly. In some cases we have contracts with suppliers. But then as those contracts expire, we have to renegotiate them so that there can be a lag.

Zach Kirkhorn: (17:44)
In some cases, our contracts do directly reflect movement in commodity prices, raw material prices. But the timing in which that Tesla pays for that has a lag associated with it as well, based on the contract. And so to Elon’s point what we’re trying to do here, because it’s quite an unprecedented situation of raw material movement, and all of these various lags and uncertainty around renegotiating contracts is, we’re trying to anticipate where things will go. And make sure the pricing that we have put in place at the time that those raw material cost increases hit us, that they align. And that the company can remain financially healthy in various scenarios as we look out over the next four quarters.

 

[GOVA]

You don't believe people are getting "boned" by these price increases? So you think runaway demand relative to supply driving up inflation isn't hurting consumers by increasing prices far beyond reason while adding nothing of value to the product itself?

You don't think the Lyriq looks cool as heck?

There's no doubt that I'm here to be a contrarian voice and that's more pronounced in this thread specifically, less so in other parts of this forum, but the thumbs up below my username suggest some usefulness to the posts.

Hey, bot. looks can't charge reliably and quickly on the road, looks can't provide Tesla's reliability for all aspects of driving.
I know a few folks that have gone for looks alone and all of them are sorry.

In any case, not sure what that Lyriq is but typing it in breaks by keyboard.

 

[JRP3]

You don't think the Lyriq looks cool as heck?

The front is a disaster, like many competing EV's. Not bad from the side.

 

[BrownOuttaSpec]

The price increase tells me that the backlog continues to grow and Tesla can continue to raise prices because there is no shortage of demand for their products. Model Y now has a estimated delivery of Jan 2023-April 2023 for Long Range models.

FYI: My Model Y estimated delivery was pushed back from Aug-Oct to October 10 - December 05. See signature for details of spec ordered

 

[AndrewZ]

Hey, bot. looks can't charge reliably and quickly on the road, looks can't provide Tesla's reliability for all aspects of driving.
I know a few folks that have gone for looks alone and all of them are sorry.

In any case, not sure what that Lyriq is but typing it in breaks by keyboard.

These are legitimate arguments against it and good reason for Cadillac to continue stepping up their game and for Tesla to continue pushing and not become complacent

 

[The Accountant]

My intuition agrees with this. Do you or anyone else have hard evidence that this is so? I’m wondering if that’s buried in the 10-Q or published supplier contract announcements or something.

Also - on the 10K (not 10Q) I found in the Exhibits, some supplier agreements.
See the Panasonic agreement here:
Panasonic Agreement

See section 4 where Metal Adjustment and Lithium Adjustment are discussed.

 

[mongo]

My intuition agrees with this. Do you or anyone else have hard evidence that this is so? I’m wondering if that’s buried in the 10-Q or published supplier contract announcements or something.

Unless something changed, wire harness pricing is adjusted based on the cost of copper (trailing average I think).
One could extend that to castings and injected molded parts.

 

[Gigapress]

You don't believe people are getting "boned" by these price increases? So you think runaway demand relative to supply driving up inflation isn't hurting consumers by increasing prices far beyond reason while adding nothing of value to the product itself?
You don't think the Lyriq looks cool as heck?

There's no doubt that I'm here to be a contrarian voice and that's more pronounced in this thread specifically, less so in other parts of this forum, but the thumbs up below my username suggest some usefulness to the posts.

1) People are buying the car knowing exactly what the price is before clicking the order button. Getting boned would imply being tricked with tactics like bait & switch or being emotionally manipulated with social engineering sales techniques, both of which legacy dealerships do but Tesla doesn’t do. In the referenced post, you asserted that the gap between CoGS and price is how much the customer is getting “boned”, which is obviously false. Customers only care about value for their money. If Tesla tried to charge prices close to their cost, the backlog would be years long, which serves no one. Clearly the customers are almost all happy with the purchase, so in effect you are implying they are morons smiling while getting screwed. Also, the product is getting better. Software updates, more superchargers, more range, lower weight, etc. The fact that customers receiving cars today are often paying less than the current price of used Teslas speaks volumes about the value proposition.

2) There is plenty of criticism of Tesla on this part of TMC. Most of it is actually reasonable. Yours is a stretch, except for FSD timeline criticisms which—newsflash—everyone already knows about.

3) The Lyric has a ridiculous faux grill taking up the entire front fascia. This anachronistic design will appear increasingly dated when ICE car sales collapse in the coming years. The Cadillac logo silhouettes all over the car are tacky in my opinion. It’s a decent-looking vehicle but nothing really special I think.

 

[EVDRVN]

The front is a disaster, like many competing EV's. Not bad from the side.

So so on inside. I wonder how much market adjustment it will have. VW dealer here adds $15K to ID4 if there is a cancelled order and one comes available sooner.