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

[2daMoon]

Folks, a bullish sign.

I was talking to my friend who left Tesla for Google then rejoined Tesla. I joked about the toilet paper, and he went into a serious rant about how somehow the toilet paper was still some extremely narrow width and super thin single ply, even after all these years. He also mentioned how there were still big bathroom wait lines after lunch.

Bullish because those cost savings will eventually reach the bottom line. A serious tissue. I mean issue.

You're just trying to paper over this discrepancy by plying us with toilet humor, aren't you?

 

[thx1139]

Tesla typically doesn't make too many changes for the first week or two after the end of the quarter to upset people who just took delivery. I'd expect a raft of changes when they come.

The people just got $7500 discounts because of just this including people and cars that arent eligible for the IRA Tax Credit.

 

[jhm]

Holy schnikes, 100+ launches in 2023?!

SpaceX will try to follow record-breaking 2022 with busier 2023 - NASASpaceFlight.com

SpaceX has shattered the record for launches in a calendar year by a single rocket…

www.nasaspaceflight.com

2 launches a week! That's like a full-time job for the guy who counts down the last 10 seconds before ignition.

 

[MagicStock]

Way too much FUD now.

Zach told us very clearly in the Q3 conference call we should again expect a gap between production and deliveries in Q4, and those cars in transit should be delivered shortly upon their arrival in Q1 to their customers.

By smoothening the deliveries Tesla simplify their operations, reduce costs and improve the customers experience.

 

[AndrewZ]

Haven't seen this posted, but I'm writing my email tomorrow...

IRS invites consumers to comment on EV tax credit qualifications

The Internal Revenue Service (IRS) is inviting consumers to share comments on the electric vehicle tax credit qualifications.

www.teslarati.com

"The IRS gives specific instructions on how to submit the comments. Comments can be submitted by mail or email. For those submitting by email, you need to include OMB Control No. 1545-2137 in the subject line and send it to [email protected]"

The IRS had requested feedback leading up to the guidance that was supposed to be issued by the end of 2022 as well, they've been accepting comments for many months now

 

[thx1139]

The IRS had requested feedback leading up to the guidance that was supposed to be issued by the end of 2022 as well, they've been accepting comments for many months now

This is different now that we actually see what is and isnt eligible.

 

[Max Plaid]

When can we expect an official stmt from Tesla on how IRA is impacting MY, what action they are taking and what changes they are making to the offerings?
I think it is important to let everyone know the impact, and resolutions in place.

Three months, maybe, six months definitely!

 

[jhm]

Folks, a bullish sign.

I was talking to my friend who left Tesla for Google then rejoined Tesla. I joked about the toilet paper, and he went into a serious rant about how somehow the toilet paper was still some extremely narrow width and super thin single ply, even after all these years. He also mentioned how there were still big bathroom wait lines after lunch.

Bullish because those cost savings will eventually reach the bottom line. A serious tissue. I mean issue.

They'd have comfy 3-ply TP if it were a union shop.

 

[AndrewZ]

This is different now that we actually see what is and isnt eligible.

I can't fathom the furor when the end of year approaches and people realize that vehicles with any Chinese battery components will soon not be eligible for either halves of the credit, or the end of next year when that same disqualification applies to vehicles with any critical minerals from foreign entities of concern.

 

[samppa]

About a decade ago I/we pulled our business out of being a storage designer/manufacturer. One of the reasons I did so was because I knew we did not have the depth of capital to go head-to-head with Musk/Tesla in the space, and nor could we compensate with low labour costs. So we focussed in other places. I/we were very right to be concerned as Tesla's offering was attractive: they simply had more firepower and it showed.

Collectively the Chinese on the other hand did not step back. They have comparable depth of capital to Tesla/Musk (or far more, depending on how you view things) and they pushed ahead with moving LFP from concept to reality, reaching (now) a price/performance point that is globally relevant to the mass market for storage. (and related stuff) They primarily did that because they were motivated by the vehicle market. The term I have used for 15+ years is that there is a mobility-premium for wrapping a battery in a vehicle shell, and the market simply does not - for many very understandable reasons - want to grant that premium margin to stationary storage. So LFP was aimed at vehicles. But it is also en passant solving the storage problem which is now scaling fast.

The size of that rapidly growing mass market from year-to-year is a closely held secret, if indeed anyone knows all the puzzle pieces. I try to track it through different approaches, but it is nigh-on impossible to quantify. I'm not sure many other people have a much better understanding, however much they sell their research reports for (they used to come to me, trying to blag me to get my data for their report). As you probably know I suss out the vehicle/battery splits each year to try and keep tabs on that, enough to do some basic public domain analysis. Quantifying storage with an equivalent precision was tough. From the limited poor quality signals I could assess, until last year I thought Tesla had overwhelming dominance in the utility segment, but was less obviously dominant in the domestic segment, and there were signs that the commercial segment was a fizzle for everyone.

In the course of the last year it has become clearer from the qualitative public domain info that Tesla is no longer competitive in the domestic market. That is why apart from some special niche markets (such as the USA ..... which is why a lot of US-ians aren't reading the tea leaves well ....) Tesla has largely pulled out of attempts to grow their presence in domestic. Instead Tesla has focussed its efforts on the larger utility-scale products and projects. Now does this mean that Tesla can't sell every (domestic) Powerwall it produces: no. Does this mean the price for Powerwall's is reducing : no. So But go look in the market beyond the USA and the Tesla Powerwall is practically a dead product, swamped under a tidal wave of Chinese clones. Overall the Chinese are growing their absolute market size faster than Tesla is, and hence Tesla's market share is reducing.

Umm.. you do realize that Tesla has never even sold powerwalls outside north america? Or have they?

I'm certain it's never been available in europe.

 

[Paracelsus]

Wait ... I believe the CEO has a very big megaphone now. All he has to do is tweet asking why Y doesn't get any EV credit when a bunch of hybrids do at Secretary Pete.

He'll get an answer for sure.

That's awesome @EVNow - I am still rolling at the concept of that:

A bit more fitting of a ring to it for Pete as compared to Better Call Saul, particularly since Pete was one of the folks in the administration that absolutely refused to say the word 'Tesla' out loud, even when the media would press him on it because they knew their audience was already aware of the conflict that presented for Pete. Do you really believe that Pete would even consider answering Elon on Twitter regarding anything to do with Tesla? If your answer wasn't just another knock on Elon/Twitter and you were being completely sincere then I would encourage everyone on TMC to constructively get your message to Elon to do just that, and let's get this Model Y exclusion fixed ASAP.

 

[petit_bateau]

Umm.. you do realize that Tesla has never even sold powerwalls outside north america? Or have they?

I'm certain it's never been available in europe.

Yes they have been sold by Tesla in a planned manner with installer networks outside USA, including in Europe and Australia (and UK which is of course also in Europe). I've not checked much for other places. A few installers near me do a few each month. They are much-favoured by Tesla, others cannot get any stock.

 

[Singuy]

Yes they have been sold by Tesla in a planned manner with installer networks outside USA, including in Europe and Australia (and UK which is of course also in Europe). I've not checked much for other places. A few installers near me do a few each month. They are much-favoured by Tesla, others cannot get any stock.

Okay so it's a lack of supply, not because it isn't competitive.

 

[Stormy24]

Yes they have been sold by Tesla in a planned manner with installer networks outside USA, including in Europe and Australia (and UK which is of course also in Europe). I've not checked much for other places. A few installers near me do a few each month. They are much-favoured by Tesla, others cannot get any stock.

I can confirm I have one in the uk (2019)

 

[bkp_duke]

About a decade ago I/we pulled our business out of being a storage designer/manufacturer. One of the reasons I did so was because I knew we did not have the depth of capital to go head-to-head with Musk/Tesla in the space, and nor could we compensate with low labour costs. So we focussed in other places. I/we were very right to be concerned as Tesla's offering was attractive: they simply had more firepower and it showed.

Collectively the Chinese on the other hand did not step back. They have comparable depth of capital to Tesla/Musk (or far more, depending on how you view things) and they pushed ahead with moving LFP from concept to reality, reaching (now) a price/performance point that is globally relevant to the mass market for storage. (and related stuff) They primarily did that because they were motivated by the vehicle market. The term I have used for 15+ years is that there is a mobility-premium for wrapping a battery in a vehicle shell, and the market simply does not - for many very understandable reasons - want to grant that premium margin to stationary storage. So LFP was aimed at vehicles. But it is also en passant solving the storage problem which is now scaling fast.

The size of that rapidly growing mass market from year-to-year is a closely held secret, if indeed anyone knows all the puzzle pieces. I try to track it through different approaches, but it is nigh-on impossible to quantify. I'm not sure many other people have a much better understanding, however much they sell their research reports for (they used to come to me, trying to blag me to get my data for their report). As you probably know I suss out the vehicle/battery splits each year to try and keep tabs on that, enough to do some basic public domain analysis. Quantifying storage with an equivalent precision was tough. From the limited poor quality signals I could assess, until last year I thought Tesla had overwhelming dominance in the utility segment, but was less obviously dominant in the domestic segment, and there were signs that the commercial segment was a fizzle for everyone.

In the course of the last year it has become clearer from the qualitative public domain info that Tesla is no longer competitive in the domestic market. That is why apart from some special niche markets (such as the USA ..... which is why a lot of US-ians aren't reading the tea leaves well ....) Tesla has largely pulled out of attempts to grow their presence in domestic. Instead Tesla has focussed its efforts on the larger utility-scale products and projects. Now does this mean that Tesla can't sell every (domestic) Powerwall it produces: no. Does this mean the price for Powerwall's is reducing : no. So But go look in the market beyond the USA and the Tesla Powerwall is practically a dead product, swamped under a tidal wave of Chinese clones. Overall the Chinese are growing their absolute market size faster than Tesla is, and hence Tesla's market share is reducing.

Anyone who has ever read Christensen's "Innovators Dilemma" can tell you what is most likely to come next. I've spoilt things by giving my opinion. Tesla will sell every utility scale Megapack they can make for the next few years and will command a premium price for them. None of them will sell into China. Many will sell into USA or to clients in the wider western alliance who are allergic to China. But increasingly the Chinese will move upscale into the utility segment and take what in the longer term will likely become the commanding position. And then Tesla utility-scale storage margins will wither year-by-year with no path back, no matter how many turnaround plans are attempted. The projected scenario in the graphs I gave earlier are very much the high-case; the low-case is far less attractive.

Is this a logical harvesting strategy for Tesla, yes. Is it a sign of weaknesses inside Tesla, also yes. Ultimately we know that pathway is terminal in the hardware space. (Tesla keeps on saying that is has not got a capital problem, but it has been AWOL on deploying it aggressively in this space. So that means Tesla has had a leadership talent problem in this space. I'd have though that much was patently obvious given the history of what we now call Tesla Energy). Does it mean investors should worry, absolutely, because by the time storage sales revenues are that significant then also the stuffing will have been beaten out of margins.

I realise it is not popular to say this, but a corresponding story is so far playing out in the BEV market. The data shows that Tesla is year-on-year losing market share by volume, by GWh, and by revenue. I last posted this graph about 11-months ago. Clearly Tesla has put its first team into bat in the vehicle market, and the seconds are playing in the storage market (and crikey knows who are in the solar market). The first team are playing an excellent game. The second team may be about to get a second wind for a while. And the third team are playing in some 0.1% league.

The analysts who are asking questions on the quarterly call are about as dangerous as a newborn baby deer. The better-armed hunters in the market have shot off a lot of ammunition recently, and some of it has hit home - that was because they can detect a valid scent, even if they don't yet fully understand it. Tesla needs to decide whether it is predator or prey, rather than distractedly fiddling with blue feathery baubles in another room.

View attachment 891986

Perhaps we should send Elon a copy of Andy Grove's "Only the Paranoid Survive"?

 

[generalenthu]

About a decade ago I/we pulled our business out of being a storage designer/manufacturer. One of the reasons I did so was because I knew we did not have the depth of capital to go head-to-head with Musk/Tesla in the space, and nor could we compensate with low labour costs. So we focussed in other places. I/we were very right to be concerned as Tesla's offering was attractive: they simply had more firepower and it showed.

Collectively the Chinese on the other hand did not step back. They have comparable depth of capital to Tesla/Musk (or far more, depending on how you view things) and they pushed ahead with moving LFP from concept to reality, reaching (now) a price/performance point that is globally relevant to the mass market for storage. (and related stuff) They primarily did that because they were motivated by the vehicle market. The term I have used for 15+ years is that there is a mobility-premium for wrapping a battery in a vehicle shell, and the market simply does not - for many very understandable reasons - want to grant that premium margin to stationary storage. So LFP was aimed at vehicles. But it is also en passant solving the storage problem which is now scaling fast.

The size of that rapidly growing mass market from year-to-year is a closely held secret, if indeed anyone knows all the puzzle pieces. I try to track it through different approaches, but it is nigh-on impossible to quantify. I'm not sure many other people have a much better understanding, however much they sell their research reports for (they used to come to me, trying to blag me to get my data for their report). As you probably know I suss out the vehicle/battery splits each year to try and keep tabs on that, enough to do some basic public domain analysis. Quantifying storage with an equivalent precision was tough. From the limited poor quality signals I could assess, until last year I thought Tesla had overwhelming dominance in the utility segment, but was less obviously dominant in the domestic segment, and there were signs that the commercial segment was a fizzle for everyone.

In the course of the last year it has become clearer from the qualitative public domain info that Tesla is no longer competitive in the domestic market. That is why apart from some special niche markets (such as the USA ..... which is why a lot of US-ians aren't reading the tea leaves well ....) Tesla has largely pulled out of attempts to grow their presence in domestic. Instead Tesla has focussed its efforts on the larger utility-scale products and projects. Now does this mean that Tesla can't sell every (domestic) Powerwall it produces: no. Does this mean the price for Powerwall's is reducing : no. So But go look in the market beyond the USA and the Tesla Powerwall is practically a dead product, swamped under a tidal wave of Chinese clones. Overall the Chinese are growing their absolute market size faster than Tesla is, and hence Tesla's market share is reducing.

Anyone who has ever read Christensen's "Innovators Dilemma" can tell you what is most likely to come next. I've spoilt things by giving my opinion. Tesla will sell every utility scale Megapack they can make for the next few years and will command a premium price for them. None of them will sell into China. Many will sell into USA or to clients in the wider western alliance who are allergic to China. But increasingly the Chinese will move upscale into the utility segment and take what in the longer term will likely become the commanding position. And then Tesla utility-scale storage margins will wither year-by-year with no path back, no matter how many turnaround plans are attempted. The projected scenario in the graphs I gave earlier are very much the high-case; the low-case is far less attractive.

Is this a logical harvesting strategy for Tesla, yes. Is it a sign of weaknesses inside Tesla, also yes. Ultimately we know that pathway is terminal in the hardware space. (Tesla keeps on saying that is has not got a capital problem, but it has been AWOL on deploying it aggressively in this space. So that means Tesla has had a leadership talent problem in this space. I'd have though that much was patently obvious given the history of what we now call Tesla Energy). Does it mean investors should worry, absolutely, because by the time storage sales revenues are that significant then also the stuffing will have been beaten out of margins.

I realise it is not popular to say this, but a corresponding story is so far playing out in the BEV market. The data shows that Tesla is year-on-year losing market share by volume, by GWh, and by revenue. I last posted this graph about 11-months ago. Clearly Tesla has put its first team into bat in the vehicle market, and the seconds are playing in the storage market (and crikey knows who are in the solar market). The first team are playing an excellent game. The second team may be about to get a second wind for a while. And the third team are playing in some 0.1% league.

The analysts who are asking questions on the quarterly call are about as dangerous as a newborn baby deer. The better-armed hunters in the market have shot off a lot of ammunition recently, and some of it has hit home - that was because they can detect a valid scent, even if they don't yet fully understand it. Tesla needs to decide whether it is predator or prey, rather than distractedly fiddling with blue feathery baubles in another room.

View attachment 891986

Very good post. This validates for me that the bull case for Tesla is really a combination of FSD revenue, Robotaxi, and any optimus related stuff. Strip them out and what you're left with is a biz that is not dissimilar from what BYD today is (minus their ICE / Hybrid biz). Plus may be some brand and network effects in their SuC ecosystem. The wall st lean to not ascribe any value to their Energy biz feels pretty close to getting validated. The unfortunate truth.

That said even for their core BYD like biz, the price is certainly undervalued. May be it deserves 30-40% premium from here, given where riskfree rates are, but thats still a far cry from ATH.

 

[bkp_duke]

Umm.. you do realize that Tesla has never even sold powerwalls outside north america? Or have they?

I'm certain it's never been available in europe.

We're many deliveries in Australia.

 

[Dutchie]

Most of my TSLA was tied in an education savings plan. My daughter is now a student. Last year the value of the Education Savings Plan accumulated well into the six figures. Since you have to take all the money out of the Education Savings Plan while your child is a student, I decided last year January to take over a quarter out and put that in a tax free savings account - again invested in TSLA. If you keep it and take money out of the Education Savings Plan when your child is not a student you will be hit with penalty tax, that is why.

All the money that was taken out of the education plan is taxed by my daughter. In the mean time I came up with some expected and unexpected expenditures, so over the cause of the year I depleted the tax-free savings account. I am left with the remainder of the education savings account in which there are still 146 TSLA shares.

Now we (my daughter) are stuck with a tax bill of almost $20K. If the prices of TSLA remained “normal” it would not have been such a big deal. Now it is bad and I might need to deplete the remainder of the education plan just to pay the taxes. This is a real bummer - in that case no more TSLA.

The tax is due to end of April, so we still got a bit of time. In the mean time I will try to save as much as possible. Otherwise, I (my daughter) will try to get a payment arrangement with Revenue Canada. Has any of my fellow Canadians have any experience with this kind of things with Revenue Canada? I don’t want to sell the remainder of my TSLA

This morning I drove to the gym again with FSD. I got my camera upgrade last week and the software about five days ago. What an amazing technology it is. I am in awe every time I use it. You only need to use the accelerator once in a while to give it nudge as the system is sometimes overly cautious.

Just for anyone out there. If you feel gloomy about these prices, drive a bit. Use FSD when you have it. You realize how awesome the technology is and why we will be right in the long run.

In the mean time I will need to get out of this mess.

 

[chrsk]

Okay so it's a lack of supply, not because it isn't competitive.

is it competitive though? 11500usd for 13,5kWh?

Price per kWh seems to point towards some insane margins…

 

[Favguy]

Umm.. you do realize that Tesla has never even sold powerwalls outside north america? Or have they?

I'm certain it's never been available in europe.

I know a lot of people here in the UK with Tesla powerwalls!