The good news is we don’t have to wait too long. If what you say is true I expect to see that reflected in the numbers and the pivot couldn’t have come at a better time from a macro perspective.
-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
I'm not denying that residual laws and policies from past legislation hasn't helped shape the IRA. And I'm not saying everyone who works in government is a crook. I'm just trying to make clear that many of us see plenty of conflicts of interest baked into this bill by design, that's all. This bill isn't merely a comical example of lazy, political ineptitude gone wild, but of another wasteful piece of pork that yet again helps poorly-managed businesses gain wealth through political connectedness rather than through hard work, quality products and merit. Many of us would rather see businesses fail or succeed through free market mechanisms than through cronyism and handouts.
No one denies there is lazy ineptitude present everywhere, at all levels of society. But when it comes to crafting billion/trillion dollar federal spending bills or bailout packages, in the aggregate there's more conspiratorial fraud than incompetence, that's all I'm saying. Frankly, if I had billions to leverage the government to tilt the playing field in my favor, I would. Again, agree to disagree. I'm done.
KBF
Model X owner (formerly Cdn Signature Model S)
This, to me, is the biggest and most obvious sugar. There should be real world consequences to these analysts for blatant dishonesty (unfortunately I don't see a realistic way of getting there). There's zero logic or accountability involved, it's pure manipulation, and somehow investors pay attention to these crooks.My headline would be "goldman cuts price target from 261 to 205 after beating their forecast estimate of 1.05M units for 2022."
Everyone keeps punishing Tesla for failing to meet aggressive guidance everyone felt was BS to begin with.
Tesla To $205? Here Are 10 Other Price Target Changes For Tuesday - Anavex Life Sciences (NASDAQ:AVXL), Brilliant Earth Group (NASDAQ:BRLT)
Goldman Sachs cut Tesla, Inc. (NASDAQ: TSLA) price target from $235 to $205. Goldman Sachs analyst Mark Delaney maintained a Buy rating on the stock. Tesla shares fell 2.6% to $119.93 in pre-market trading.www.benzinga.com
I'm totally fine if a company says "No way is Tesla going to grow 50%" and provide their own numbers. But their price point estimation is supposed to be based on their replacement predictions. How are people so dumb as to fall for this garbage??? Goldman is as irrelevant as the credit rating companies... But they seem to make a lot of money scamming people...
StealthP3D
Well-Known Member
Of course. The fairytale that there is only one federally recognized standard of vehicle classifications is simply intellectual dishonesty by those who are telling you to, "Move along, nothing to see here" or those who are naiver than a new-born infant. Congress gave the Treasury wide latitude to perform rule-making that was consistent with the stated intent of the IRA.
Maybe Tesla didn’t issue a profit warning for missing the guidance, because it would have looked really bad to do just after Musk selling?
StealthP3D
Well-Known Member
Maybe Tesla didn't issue a profit warning because they are making money hand over fist! Duh!
It was "a gap" not "a large gap"
Running the numbers...
Production: tracking 50% and supply chain risks
Deliveries: just under 50%
Production vs deliveries: big gap
2021:
Production: 930,422 * 1.5 = 1,395,633
Deliveries: 936,172 * 1.5 = 1,404,258
Q1-Q3:
Production: 929,910
Deliveries: 908,573
Q4 target:
Production: 465,723
Deliveries: 495,685 for 50%
At 47% YoY, deliveries would equal production and 36k of inventory would carry forward. Each 1% is around 10k cars.
Term is also used for issuing guidance down, which should have been done imho.
Tesla didn't guide on profits. They guided on growth in a vague way. Their "Guidance" didn't even say whether it was growth in production or deliveries. Nor was it limited to vehicle's produced.
The assumption here is that profits have missed some mark Tesla set, but they haven't. Even if you interpret their rather vague "50% growth" guidance to mean profits, that number is almost certainly in the bag.
I'm not trying to gloss this over, but there seems to be a lot of assumptions baked into this "Miss" that are just invented in people's heads.
I do agree it's reasonable to say they missed on deliveries, and maybe that means profits will disappoint. But that's putting the cart ahead of the horse. The "miss" wasn't large enough that better margins or Tesla Energy couldn't fill the gap.
Buybacks are not the answer … get that darn cybertruck into production!
I don't think casting requires a particular factory size.
The same casting machine can make a number of different castings for different models.
The casting capex is offset against less stamping, fewer body shop Robots, less floor space.
What I hope Gen3 involves is a lot more casting, but a mixture of mschine sizes including cheaper 4000 series machines where possible.
On site 4680 LFP cell and structural pack production.
Aliminium bodies, a mixture of painted and unpainted.
4 different Models from the same factory total combined capacity 1-2 million per year.
My view is that Chinese EV makers will only be able to compete against this model by copying it, it seems like the formula for the cheapest possible EVs.
I don't know what Tesla has in mind, but cars on boats are a waste of money, the best logistics is minimal logistics, with cars built as close as possible to the end customer.
Ditto for logistics Chinese will not be able to compete by shipping cars from China to worldwide markets. RORO is an expensive option for entry level cars.
If Q4 earnings aren't better than expected I'm going to be pretty frustrated with Elon. No downward guidance, only talk of macros and epic quarters. All the while selling, knowing that P&D would be light. Last sale was at $150 or so.
When we get new guidance on the call WS won't bother to listen. May as well say they want 30% growth and take the haircut now. A little sandbagging wouldn't hurt.
When we get new guidance on the call WS won't bother to listen. May as well say they want 30% growth and take the haircut now. A little sandbagging wouldn't hurt.
That is exactly what I have been thinking. My Model LRAWD was purchased for under $55k MSRP 8 months ago. I am assuming they made a large profit on it. At the volumes they want to sell this seems almost inevitable to me even before this arbitrary EV rebate.
For energy storage 4680 LFP is IMO exactly the right play.I keep seeing this meme that Tesla Energy is going to save the day, the year, the decade. Not just from you but all over the place. Especially here on TMC. However much I might wish that to be the case (and as a shareholder I would like it to be so) the actual facts do not support the hopium on offer.
So sorry if this seems like a snippy response to your post, really it is a response to all energy hopium posters.
1. Tesla solar is pants. It is not even a rounding error on global solar sales. It shows no signs of changing nor do I expect it to in this decade, if ever. Approx 315 GW of global solar was installed in 2022, and Tesla will have done barely 0.3 GW of that. Can you say 0.1% very slowly ?
2. Tesla wind is worse. It is to be precise zero. So of the 110-120 GW of wind installed globally in 2022 there is nil attributable to Tesla. Yes, that is 0%. Nada, zilch, rien.
3. The evidence I see suggests that Tesla Energy is slipping in the storage space. In domestic storage it is not even on the leader board for most of the world, excepting USA. In utility storage it has no penetration in China, is market leader in USA, and RoW is very murky but with plenty of non-Tesla wins.
4. For the next several years the vast bulk of the cells going into the storage market will be LFP. That is good, the characteristics of LFP make it a good match for storage. Remind me again how much LFP Tesla makes. Yes, zero. Tesla does not have a competitive advantage in LFP manufacture. The people who do make LFP such as BYD, CATL sell to everyone in the storage market, including themselves for packaging into client-ready cabinets. So the people who are most vertically integrated in this area are BYD et al, not Tesla.
5. Putting LFP into a 4680 form-factor does not seem to be an attractive or high-priority thing for the next few years, if ever. Prismatic LFP is plenty good enough for storage. Load-bearing prismatic LFP seems to be attractive in auto as well, but that's not that relevant in storage (except double-wrapping becomes unnecessary). So by the time that 4680 form-factor reaches LFP (if ever) then there is no reason to think that Tesla will have any particular magic sauce to add.
6. The biggest other cost in storage is the bi-directional power electronics, i.e. the inverter-charger. The vast majority of these in the world are made in China. The Tesla inverters are good, but they are not a game-changer. Again, the vertical integration is better in China than in Tesla, or anybody else in USA or Europe/etc for that matter.
7. The actual products coming out of China increasingly look generic, whether they are at domestic scale or utility scale. This is because there is increasing convergence on a dominant design for each segment's core-product. (The intermediate scale, aka Powerpack, for the commercial segment, looks to be an evolutionary dead end). Now I don't think we are quite at a fully generic dominant design quite yet, but we are getting close. Especially in the domestic market where I increasingly need to check the logo before I can figure out who is actually making/selling product coming out of China. This means that huge numbers of companies who you've never heard of are suddenly making LFP domestic plug'n'play product that is remarkably good quality, fully specced, absolutely functional, low priced, and is really a good deal with not much 'pray' required. That is also increasingly the case in the utility market as well. Take a look at this link and you'll see one (of many) wins of yet another fairly unknown utility-scale supplier of containerised storage by the half-GW, with not a Tesla logo in sight.
China connects 220 MW/440 MWh battery to grid
Robestec has connected a 220 MW/440 MW battery storage system to the grid in Ningxia, China. It is reportedly China’s largest standalone energy storage station, and uses lithium iron phosphate (LFP) batteries from Hithium Energy Storage.www.pv-magazine.com
8. There is no logistics or cost advantage to Tesla in making this stuff in the USA, whatever the belief system one ascribes to. Roughly speaking one container-load of stuff disappears into one door of a factory and one container of product comes out the other door of the factory. Pretty much that is how it is both by weight and by volume. Irrespective of whether it is a domestic-scale product or a utility-scale product. The two big lumps that go in are the LFP and power electronics; labour and dumb steel get added; software gets loaded; testing happens; and a finished product comes out ready for mass-shipment. The tightest logistics integration comes from doing all this in China. Any claims that somehow doing all this in the USA lead to a better manufacturing/logistics supply chain are plain baloney. That is precisely why storage competitors of Tesla are out there around the world offering more product now than Tesla, even when Tesla's ramp is constrained by chip and cell supply shortages. Believe me, I have some on order from a competitor - the Tesla product is not available, not certified, does not integrate well with the rest of my system(s), and is in any case twice the price for no corresponding gain in functionality.
9. And last time I checked Chinese workforce were a darn sight cheaper than a US workforce, highly motivated, and very productive. In fact there is a Tesla plant or two in Shanghai that prove this (auto, and supercharger) and Shanghai is probably the most expensive place to make stuff in China. The only advantage the USA (and by extension, Tesla-USA) has is a cost one driven by a taxpayer subsidy called the US-IRA and various tariff and non-tariff barriers (whatever happened to free trade ?). That does not seem like a sustainable competitive advantage to me.
10. I've yet to see any evidence of a Tesla software advantage in this sector vs peer competitors. Yes there are advantages vs non-peer competitors, but not vs peer competitors. Want a utility-scale VPP or a trading/operating/metering platform, buy Kraken. Want to integrate with your car and your solar, buy Zappi. Or many other products. The (domestic-level) problem in the software area is not a lack of offerings, or the lack of standards, it is a lack (until now) of a dominant design that allowed this problem-set to be cleaved, and the desire by vendors for lock-in in the scaling wars. My personal guess is that the emergence of dominant designs will soon create the conditions that allow this to be solved. Yes Tesla is a nice little Apple-style walled garden, but don't mistake it for the only game in town. And whilst sometimes walled gardens are very productive Apple-style enterprises, more often they are a fast road to ruin - Yahoo, AOL, DoCoMo, are just some that tried and failed.
11. Look at the actual numbers.
a) If you think that Tesla Energy is going to grow to become 50% of Tesla Incs revenue then either the rest of Inc is going to have an epic fail, or I have to ask how many decades are you looking ahead - best I can figure out is 40% by 2030 with a lot of favourable winds to reach Tesla's own target:
View attachment 891832
b) Ditto profits, well only 37%,
View attachment 891833
c) Ditto cell usage, max 50/50 by 2030:
View attachment 891834
12) So overall if Tesla Energy is going to have a crack at world domination in storage it will need to scale much faster than it has been doing; to recognise that the competition is in fact here; and to spread its plants globally like now, and especially into China and Europe. If it is not careful it will enter the death spiral of Tesla solar and be globally irrelevant.
13) No more hopium please.
4680 should result in the cheapest LFP, the fastest scaling, and it should be very easy to do, with a quick ROI on capex.
Given the IRA, the Biden admin is practically begging Tesla to do it.
4680 LFP in India, initially for energy storage. also something that seems to make sense.
Stretch2727
Engineer and Car Nut
Correct me if I am wrong but Tesla does not give any profit guidance. Only the 50% multiyear average vehicle unit growth.
According Elon profits anywhere north of 1% is acceptable as it is supporting the mission. He has said this many times over the years.
That's why I am speculating that they were hoping for more production. Your scenario requires pretty much everything to go right as the number of inventory units are just too low to hit 47% without giving every effort and hope that all the ships arrive on time, and 2/3 of all deliveries get crammed into December. This is why they were hoping for higher production because they were not going to push.
If they were to keep the same gap of 95.6% cars delivered vs produced, production would need to be like 1.43M or so, an extra 50k worth to hit the "just under 50%". The gap was always going to be there due to unwinding the wave. Your scenario is barely no gap and goes back to pushing for wave deliveries.
Knightshade
Well-Known Member
Except they absolutely did say they intended to grow BOTH of those by 50% or more, specifically in 2022.
Only in Q3 did Zach finally admit they might miss that on ONE of the two marks (deliveries) but reiterated they expected to still hit it on the other mark (production)..... in the end they missed one by a few percent, and the other by roughly 10%
I don't think any of the above has anything to do with what kind of profit will be posted, nor did they guide for THAT-- but why do people keep denying what was actually said, by tesla, as guidance for 2022 specifically- especially when multiple people have directly quoted Zach and Elon on this, with Troy even providing direct links to the relevant audio from each quarterly call?
We also need a big flashing sign on the wall saying. "Remember the IRA".
The IRA is going to make ir harder for Chinese cell and raw material supplies to compete in the US.
The IRA definately favours North American cell production and supply chains from countries having free trade agreements with the US.
Those free trade agreements come into play when Megapacks are exported.
As things stand, very few countries are interested in giving China an easy ride.
StealthP3D
Well-Known Member
Capitulation happened last week with the presumption that we'd rally on good P/D. Some shorts covered as well but they just placed them back on today.
I don't know why some people keep claiming capitulation already happened. IMO, capitulation doesn't look like that. If you zoom in too closely, everything looks like a crash or a capitulation. Try to think in big "chunks" of money and time if you want to be a better investor.
That's fine. I assumed as much and said so if you'd bothered reading the whole post.
Why are you arguing a point I didn't dispute? You are off in the weeds here.
Similar threads
- Locked
- Locked
- Locked
