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

[unk45]

All of this innovative engineering change has been accomplished through a vision. Without the vision, it all dies on the vine (see several historical auto/tech references and look back at years of CES widgets/starts) where good tech died in its infancy without an enduring and cohesive vision to 'see it through'.

To be clear, Tesla doesn't just make a car, they make/engineer/design/produce 'nearly' all the innovative pieces/parts/sub-assemblies (they don't make the commodity pieces like tires, paint, various adhesives, plastic pellets, textiles, connectors or the monitors/screens, but that is another story...) vertically integrated as well as 'nearly' all of the code (I actually can't think of code they don't write themselves at the moment though, maybe some Kuka code is unaltered by Tesla devs...). And if I worked for Sandy, I'd have them put the Tesla parts in a pile and non-Tesla parts in a pile and deep dive into why Tesla hasn't done in-sourced them yet.

NO OTHER AUTOMAKERS DO THIS! (sorry to yell), but folks just don't understand this.

So, Tesla is not as much a car manufacturer, as they are "THE SOURCE" of the creation of 'nearly' all the innovation that go into the car as well as the production process, sales process, support process, update process, connectivity/services and the long standing belief that marketing is a near useless vestige of improper product/customer focus.

I'd assert: Without Tesla's vision, EVs would simply NOT exist in any meaningful/material way.

I really do not like to point this one out. BYD even makes its own semiconductors, although they are planning a spinoff of that one. Their Blade batteries are good enough for Tesla to buy them. Whether one like their cars, trucks, busses, trains or the phones they manufacture the reality is that they're even more vertically integrated than is Tesla. That is partly why their margins are so high.

Check out their numbers and website. One need not applaud them but one must admit they are masters of vertical integration.

 

[JRP3]

How Steve Jobs Faked His Way Through Unveiling the iPhone
What Tesla did, was working towards the capabilities shown in the video. Similar like Steve did during his product unveil.

I always thought that video was just a video promoting where Tesla wants to take the technology.

Except when Elon said this:

"When Tesla released the video, Musk tweeted, “Tesla drives itself (no human input at all) thru urban streets to highway to streets, then finds a parking spot.”"

That wasn't true.

 

[AndrewZ]

I always thought that video was just a video promoting where Tesla wants to take the technology.

The video is also preceded by a big ol' caption claiming the driver is in the seat only for legal reasons. Tesla does a lot of great things, but I don't know how to spin this early FSD treatment as anything but a pretty unfortunate blemish.

If FSD had come to fruition as planned, like Apple succeeded with the iPhone, this would all be a moot point. But it hasn't come to fruition as planned, and an iPhone doesn't have the potential public safety implications. The lawsuit in question here revolves around a fatal Autopilot accident in 2018.

 

[Cobbler]

Except when Elon said this:

"When Tesla released the video, Musk tweeted, “Tesla drives itself (no human input at all) thru urban streets to highway to streets, then finds a parking spot.”"

That wasn't true.

Eeeuhh... yes? The video showed exactly that: A Tesla driving itself thru urban streets to highway to streets, then finds a parking spot.
The software was hardcoded with a premapped route. (Completely different from today's solution). The software running on that car, shown on the video, couldn't be used anywhere else. It was a proof of concept.

Edit:

How it this different from Nikola? Trevor stated "This thing fully functions and works, which is really incredible." and also with a video implying that the truck drove on its own power. Totally false and misleading.

Elon showed a video of a Tesla driving itself. Which was correct.
When would the FSD video be fake? If, lets say, there was a person with remote control driving the car, the video had interventions edited out. Neither of those happened.

 

[Discoducky]

I really do not like to point this one out. BYD even makes its own semiconductors, although they are planning a spinoff of that one. Their Blade batteries are good enough for Tesla to buy them. Whether one like their cars, trucks, busses, trains or the phones they manufacture the reality is that they're even more vertically integrated than is Tesla. That is partly why their margins are so high.

Check out their numbers and website. One need not applaud them but one must admit they are masters of vertical integration.

Let's say we pull apart a BYD, how many of the chips are branded BYD? Are the boards branded BYD? How much of the software to they write? Can they OTA the brake firmware? Pedal monitor? EPAS? Body controls? Suspension ECU?

If any of this starts to become known, then I'd detract my statement.

 

[EVNow]

Graceful progressively decline and transfer over to BEV seems unlikely. These legacy dino-juice companies aren't good at down-scaling, and their BEV offerings are almost certainly not making any significant profit (GM%). If their BEV offerings were significantly profitable they'd be bragging about it.

I expect a few types of failure as their dino-juice volumes turn down and their NM goes negative:
- split the BEV division off into a new floated entity via IPO/SPAC; then flush the legacy debts and union agreements and pension liabilities via bankruptcy;
- straightforward collapse with the 'surprise' finding that the debt load was all taxpayer (state) backed in a lot of jurisdictions;

My guess is faulure of JLR's UK-based operations first, unless Tata can screw more money out of the UK taxpayer (pay up, or your auto industry is Brexit toast). Other weak ones might be Mitsubishi and Mazda, though Covid has thrown a wobbler into the stats. One way or another nation-states will be left holding the bill, if only in the unemployment statistics and the political consequences.

Yes, obviously, there will never be a theoretical graceful decline. We should expect dramas.

OEM bankruptcies are quite common and they are bailed out by the home country (not necessarily "tax payers", as all countries run huge budget deficits). There will be restructuring as you note, probably with a few mergers. Mitsu is already a part of Nissa group for eg. Its possible all Japanese companies will merge into one - and German into one or two etc. Small companies like Volvo may not survive (unless picked up by major groups in EU).

I also don't think EV volume can pickup fast enough to cause sudden failures. Failures are more likely because of economic condition with added EV pressure. But the main point is - large OEMs and their suppliers will not be allowed to collapse.

If large suppliers collapse it will greatly affect EV makers as well.

 

[ZsoZso]

Toothless fine. That's like . . . what? 5 minutes of short selling activity for these crooks?

The article failed to mention how much profit IBKR made on those naked shorts.
I'd be willing to bet that they made a lot more than $5.5 million profit on them, so this fine is just a small cost of doing business for them.
Now, if a retail investor was somehow trying to pull something like that, they would most likely end up in jail.

 

[StealthP3D]

I’ve been driving across the US doing my own survey. Not entirely rigorous but I also trust my own data and observations more than institutional research organizations I’m not familiar with, and some stuff can be better gleaned from longer personal conversations than short survey questions. Main limitation is one person can only talk to so many people.

I’ve talked about the car with about 30 people on this trip. Young and old; liberal, conservative and moderate; engineers and non tech savvy; immigrants and native-born Americans; even a geriatric blind woman. Total mentions of Elon with respect to the Tesla brand were zero except by my brother, but he’s invested in TSLA too and we discuss this stuff frequently. One family member has a couple liberal friends who are upset enough with Elon to consider not buying the car, and that’s all, though it’s not clear to me that these friends, who weren’t even in the market for a new ca, have actually researched Tesla or other EV options at all. Literally everyone else liked the car, or already knows they want one, and all had some questions and curiosity. Over 90% approval rating in my sample. If we count the few I heard about secondhand. 100% if we count people I talked to and showed the car or answered FAQs.

Of greatest note was visiting my 10-year-old cousin. I had not talked with my cousin about Tesla ever before. Her parents drive plug-in hybrids so she is familiar with the basic EV experience. Upper middle class suburb of major US metro area. According to her, the entire neighborhood of kids wants Teslas. I was informed that Lambos and their ilk are no longer cool and kids only want Tesla or maybe Rolls Royce. After our joy ride, she told her friends on the block, “It’s cooler than you think”. Other kids were staring, apparently enamored when we pulled out. Dropped her off at school and the volunteer kid at the drop-off line who saw her in it was smirking because she was riding in it which no one expected. Another quote from our joy ride: “All these other cars look so old”. Zero mention, positive negative or neutral, of Elon, but lots of questions and commentary about the car itself for about a half hour straight. My cousin is one person but the entire neighborhood has an overwhelmingly high net positive rating on the Tesla brand for the kids. They are probably not alone nationwide in feeling this way since we have a fairly geographically homogeneous youth culture nowadays thanks to TV and the internet and long-distance travel. If their neighborhood is at all representative of what other kids are thinking then that’s a great sign for Tesla’s future.

Come on, Gigapress, you've got to be kidding. It sounds like you might be suggesting that when people like or buy a certain brand of automobile, it has little to do with them viewing the manufacturer's CEO as their own personal gigalo or has anything to do with their political beliefs? And all along I thought Tesla's popularity was due to Elon's boyish good looks, charming personality and impeccable Democratic credentials!

OK, I've cancelled my Bolt EUV order, but I still think Mary is kinda cute! Thanks for putting me straight!

 

[MartinAustin]

If this "fraudulent FSD video from years ago" is such a big deal, why has the stock climbed to $131 today?

Everybody knows it was a prototype and did not represent what was on sale. So what if one engineer testifies that it was a hoax? Is that taken as fact? How much weight does that carry

 

[KBF]

Except when Elon said this:

"When Tesla released the video, Musk tweeted, “Tesla drives itself (no human input at all) thru urban streets to highway to streets, then finds a parking spot.”"

That wasn't true.

Is that not what actually happens in the video though? He's simply describing the test (and using singular pronouns, which clearly refers to one car - had he said, "Teslas drive themselves..." then there's at least a logical argument).

The ambiguous part is that some people will assume that ALL Teslas do this from the video, but it was obviously framed as a test/proof of concept, and that video was not promoted as "this is what is in production cars right now."

I also don't see the fuss about the limited test area with 3d mapping ahead of time... (but guess what, FSD is currently 3d mapping out wherever drivers go... So they are actually working towards exactly what they did in the video...).

Look, I'm against false advertising as a principle, but it's a big stretch to apply that here, especially in light of precedence of millions of far more misleading commercials in every industry...

Until gov't holds every advertisement to the absolute limits of pure fact-based advertising (like this 'honest ads' video - maybe people would extrapolate better if beer ads were honest! ), I think there's really nothing to see here...

Edit: here's another "Honest Ad" about cell providers - I find the whole series hilarious:

 

[unk45]

Oh, and to add to my own post here.... not only did Tesla design it along with IRDA, it was Tesla who approached a couple of manufacturers about the gigapress concept, and only IRDA returned their calls.

So it was literally Tesla's idea.

Maybe better to say IDRA. To be absolutely clear about this IDRA had to have approval from L.K. Machinery, which they could because their founder, among others, had high capacity and willingness to pursue new technology, plus their leadership regarded Tesla innovation as one path to their own future, one strongly supported in China.
Bühler was an obvious choice but they are really a conglomerate so taking a flyer on a new player like Tesla was ridiculous, especially since their history and greatest pride is in agricultural technology. Search for Bühler Industries and see they do not pride Aluminum extrusion very much, even though they're an industry leader.
Frech is family owned and really, despite their excellence, are not quipped to break new technology batteries.
Toshiba, another conglomerate, would not take a flyer, and certainly was not encouraged to follow Panasonic into a speculative venture.
The others all had similar impediments. IDRA is only about presses and only presses. L.K. came from nothing and built firs plastic extrusion, then built itself into a powerhouse with customers globally. Buying IDRA was, for them, all about developing now and better dresses, something IDRA knew about. Further aging ownership and control provided a one time opportunity. That is why IDRA. When Elon wanted something nearly impossible and already had access to superb materials technologies from SpaceX, IDRA was ready and willing, and L.K. was eager.

Were it not for those coincidences GigaPress may never have happened.
Every time one thinks of Elon's weaknesses, just think about his strengths. Who else could convince conservative heavy press maker to go for broke on unprecended technology that could finish the company if it failed. It didn't.

Now Bühler and others are trying top be fast followers. Good luck, IDRA already moved up to their first delivered 9000 tonners.

Now who else can build the factory, devlop the allows, perfect the cooling and heating process and generate the pressure needed to actually make one of those work?

THey're not unlike reusable rockets.

 

[CitizenKane]

The line between marketing and lying is fine. Elon may not have crossed it but he has certainly balanced on it a couple of times. But so do most ambitious salesmen and entrepreneurs. Every VC pitch paints a picture of what a startup will accomplish in the coming three years, how far fetched it may be. Is that a lie? Well, yes if it was presented in an academic research paper. Investors however want to give money to people who set out to accomplish the seemingly impossible. They invest in ambition and vision.

 

[AndrewZ]

If this "fraudulent FSD video from years ago" is such a big deal, why has the stock climbed to $131 today?

Everybody knows it was a prototype and did not represent what was on sale. So what if one engineer testifies that it was a hoax? Is that taken as fact? How much weight does that carry

Not to say this would drive the share price movement on a given day, but I don't think there's any way to quantify the monetary impact regardless of which way it goes.

If anyone has interest in reading the complaint itself, you can find it here

Complaint-Huang-v-Tesla-State-of-Calif-20190430.pdf | Powered by Box

app.box.com

The lawsuit has also been public knowledge for three years now, and this testimony happened last July

 

[Singuy]

BYD and other Chinese competitors completely got destroyed by the Model 3 in ADAS test. Tesla scored a 10/10, BYD Hans scored a 1/10.

https://twitter.com/x/status/1615413868922286080

 

[unk45]

Let's say we pull apart a BYD, how many of the chips are branded BYD? Are the boards branded BYD? How much of the software to they write? Can they OTA the brake firmware? Pedal monitor? EPAS? Body controls? Suspension ECU?

If any of this starts to become known, then I'd detract my statement.

Don't detract it just retract it. Just search for them and look at everything they do. The look at the margins they get. Them look at their customer list. You're still not convinced after that ?
Ask Tesla! While you're at that it might be beneficial to look up CATL.

Of course, as with Tesla not everything is publicized in easy to digest form for 'securities analysts'. As with Tesla it takes a lot of work to sort the 'wheat from the chaff'.

Neither BYD or CATL are easy to digest. Both have plentiful information if you'll devote the attention.
Note: I neglected to mention the BYD commercial battery production approach, which is very popular with utilities, commercial and residential solutions in markets they serve.

BTW, @Discoducky , have you checked out all of your questions for Tesla? Who makes their FSD chips? answer: Nvidia until 2019, then Samsung since then, now ones are coming from TSMC.

Chips, OK I'll begin your BYD introduction with them, with the note that they recently decided not to sell it off partially:
byd-semiconductor-to-put-8-inch-auto-chip-line-into-production-next-month

 

[Todesbuckler]

Tesla boat confirmed

https://twitter.com/x/status/1615397502798409729

 

[replicant]

Investors however want to give money to people who set out to accomplish the seemingly impossible. They invest in ambition and vision.

I thought we were talking about customers.

 

[JRP3]

Eeeuhh... yes? The video showed exactly that: A Tesla driving itself thru urban streets to highway to streets, then finds a parking spot.
The software was hardcoded with a premapped route. (Completely different from today's solution). The software running on that car, shown on the video, couldn't be used anywhere else. It was a proof of concept.

Edit:
View attachment 896770
How it this different from Nikola? Trevor stated "This thing fully functions and works, which is really incredible." and also with a video implying that the truck drove on its own power. Totally false and misleading.

Elon showed a video of a Tesla driving itself. Which was correct.
When would the FSD video be fake? If, lets say, there was a person with remote control driving the car, the video had interventions edited out. Neither of those happened.

"Drivers intervened to take control in test runs, he said. When trying to show the Model X could park itself with no driver, a test car crashed into a fence in Tesla’s parking lot, he said."

 

[Ogre]

Tesla boat confirmed

https://twitter.com/x/status/1615397502798409729

What is so funny about this is how effectively it undermines so much of the negative press around Tesla. More Teslas on the road sells more Teslas.

 

[Xepa777]

The main one is Electrify America, at least as long as you pay the $4/month membership fee. With that they charge $0.31/kWh or $0.12/$0.24/minute. (I think the per minute rates are way cheaper than what Tesla was charging.)

Tesla charges up to $0.60/kWh in some locations, so yeah EA can save you a bunch of money, even after taking the $4/month into account.

Holy *sugar* that’s cheaper than home charging in California. And I’m looking at these chargers in Palo Alto lol.