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

[AndrewZ]

That definition of luxury may be outdated.

I'll believe that the day high-end mechanical watches, easily surpassed by new technology in terms of function, don't sell for insane amounts of money that scales based on how needlessly complex they are.

Maybe I'm wrong, but I don't think Tesla's angle is building the automotive equivalent of a tourbillon or minute repeater. And that's fine.

 

[Ogre]

Tesla stock rally a 'short covering for the ages,' analyst says

Here's what's behind the move in Tesla stock.

finance.yahoo.com

Had to end it with this statement:
View attachment 905182

Ok… I’m done with the flaming bear… poor guy is probably crisped by now. Maybe he’ll re-emerge after the March 1st event…

The funny thing about shorting a growth stock is it must rebound eventually. You have to be slightly off your rocker to not see this. It might take 2-3 years, but it will happen.

 

[mongo]

Tesla stockpiles the 4680 packs (as seen in Joes flyovers of GigaAustin), so they likely wait until its worth the short downtime to make the production line adjustments for the different packs, so they do a multi day/week large run of them in a big batch on the single GigaAustin Y production line, hence the periodic big lump of AWD model Ys appearing in inventory.

Last update we had was they are making enough 4680 cells for 1,000 cars a week, whereas GigaAustin was at 3,000 cars a week output, so ballpark is they need to stockpile 3 weeks of 4680 cell production to do 1 week of Model Y AWD production.

2 weeks of stockpiling (building 2170 cars) plus 1 week building 4680 cars = 3 weeks of 4680 production.

 

[JRP3]

Actual new article title on SA: EV Price War: Ford's Advantage Over Tesla Is Its Legacy ICE Sector

 

[Ogre]

That definition of luxury may be outdated.

Luxury has never meant anything other than being more expensive than the alternatives.

If people are willing to pay a premium for a product year after year, that is a luxury product. Why exactly it’s luxury can be anything from better quality, better performance, gold plated rims, brand perception…. Doesn’t matter.

 

[Ogre]

Just saw this from Kyle Connor. Not sure if anyone has posted anything like this before, but I’ve not seen it. New Teslas “Know” their delivery status and when they are supposed to meet their new owner.

I’ve heard similar things about how diagnostics and other steps are built into each car as they run through the factory. Each car tests itself through various stages.

This kind of integration is nowhere else in the industry. When people talk about moats, they think of big-obvious things. For Tesla, it’s a million little subtle things like this. (Plus a few big obvious things too)

https://twitter.com/x/status/1623805040249954305

 

[StealthP3D]

Luxury has never meant anything other than being more expensive than the alternatives.

If people are willing to pay a premium for a product year after year, that is a luxury product. Why exactly it’s luxury can be anything from better quality, better performance, gold plated rims, brand perception…. Doesn’t matter.

That's a great description of what constitutes a luxury product!

But to be fair, we should include TSLAQ's definition of luxury:

Lux-ur-ry:
luhk-shuh-ree

adjective: not relating to Tesla. Having nothing to do whatsoever with Tesla.

 

[AndrewZ]

Luxury has never meant anything other than being more expensive than the alternatives.

If people are willing to pay a premium for a product year after year, that is a luxury product. Why exactly it’s luxury can be anything from better quality, better performance, gold plated rims, brand perception…. Doesn’t matter.

IMO it's not luxury without the requisite underlying quality, top notch materials, probably a higher proportion of real human labour from skilled craftspeople who have apprenticed for years, and lower volume because there are true limitations on the materials and labour available to produce things at that level. If something is punching above its weight class in price relative to what went into it, I'd expect that to revert over time.

All kinds of crazy stuff can happen over the shorter term though, it's kinda like the stock market

 

[munkypuzel]

Luxury has never meant anything other than being more expensive than the alternatives.

If people are willing to pay a premium for a product year after year, that is a luxury product. Why exactly it’s luxury can be anything from better quality, better performance, gold plated rims, brand perception…. Doesn’t matter.

BRAND PERCEPTION - this - My wife will pay £2000 ($2500?) for a leather handbang... very nicely made..but worth £300.. There you go - its all about the brand.

 

[Ogre]

adjective: not relating to Tesla. Having nothing to do whatsoever with Tesla.

I was quite disappointed to see someone posting this sort of TSLAQ BS in this thread earlier today.

BRAND PERCEPTION - this - My wife will pay £2000 ($2500?) for a leather handbang... very nicely made..but worth £300.. There you go - its all about the brand.

Yeah, brand is a bunch. People want to point to concrete things like “Precision blah blah blah”… but ultimately perception is a huge part of it for many brands. A huge chunk of Mercedes and BMW sales are just because they are exclusive brands. Look at the operating costs on those machines.

How can you say you are wealthy and smart at the same time if the best cars are not the most expensive?

 

[MartinAustin]

Luxury has never meant anything other than being more expensive than the alternatives.

If people are willing to pay a premium for a product year after year, that is a luxury product. Why exactly it’s luxury can be anything from better quality, better performance, gold plated rims, brand perception…. Doesn’t matter.

Yep. People who want everyone to know they're rich can't walk around with a big LED dollar counter sign hanging around their necks. So they drive around in lime-coloured Lamborghinis etc. and we all just treat them like they can afford to buy it

Nice TSLA action today, considering the market was going south.

 

[Ogre]

First shot I’ve seen of the beta truck from the front. That Big A__ Wiper looking ready to swat away doubters.

 

[MC3OZ]

How? The price difference is going to separate who gets a Y and who gets an X. Market segments aren't going to matter.

I'm saying that because making Highland versions of Model S/X probably will not make sense. reducing production is the lesser of 2 evils.

A Highland Model Y makes perfect sense, and they eventually want at least some trims as close as possible to a $35K-$40 entry level price.

If Model S/X remain priced at > $90K, then a $40K-$90K range is a big range for one Model to span.

Eventually new "premium" Models can be designed based on Highland, but designed for higher volume production than Model S/X.

This is just my opinion, and I'm not 100% sure, I just think customers tend to put particular car models into different categories, and are less tolerant of one model having a broad price band.

 

[MrMoo]

Sigh...It looks like people still don't understand the most basic mechanics of share valuations. For a company to have a market cap of $6 trillion, it is not necessary for people to "actually put in that much money".

Let's say you have a company with a market cap of $100,000 and they have 10,000 shares trading at $10 each. But the company has finally perfected their super-duper genetically modified goose that lays golden eggs and 1 out of ten eggs is not a golden egg, but a real one that turns into another goose that lays golden eggs. Forgetting that, with enough of these geese laying golden eggs, the price of gold will eventually crash, investors start bidding up the shares of the company. But none of the 10,000 shareholders want to sell. Eventually, other investors want in so badly the bid price reaches $1 million per share and a weak hand decides to sell his/her one share to the million-dollar bidder. Now the shares are officially "worth" a million dollars each, and the company market cap is 10 billion dollars. But only one share and $1 million dollars has traded hands as the market cap has gone up by nearly $10,000,000,000.

The share price and the derived market cap are artificial constructs based on the price of the last share traded. I'm shocked that so many people still don't understand what share price and derived market cap actually means after all the good explanations that have given here in the not-so-distant past.

edit: And to be clear, even if exchanges have special rules that prevent the sale of one share from moving the price that much, the principle is still the same, the market cap is a derived metric that has nothing to do with that much money having traded hands.

Your example works great for a microcap stock but never in the history of the stock market has a mega cap stock gone up 1000% in premarket movement. If you watch the movement of the trillion dollar companies the most you ever see them move is 10-20% and the 20% moves are from earnings misses. The beats are usually bound within 0-10%. There isn't a world where you aren't going to require many many trillions of dollars worth of shares to trade hands before TSLA Reaches 6 trillion.

Even if we trade flat for 2 years then suddenly decide go to up to the 6 trillion valuation in 2025 it'll take months of trading to get up there. How many months did it take for TSLA to 10 times from $29 to $290 in 2020? 12 months right? You don't think $900 billion traded hands in those 12 months to get it to that valuation? And I'm aware 900 billion worth of shares can trade hands with the companies valuation not moving at all too. My point is that to get the buying pressure to get the stock from $200 to $2000 you are going to need new money. You can't just buy sell shares back and forth. You are going to need a lot of it to get the share price up and it'll take many many days of trading to get there.

 

[JustSaying]

OT,
Not sure if this has been mentioned here before but the Petersen Auto Museum in LA has a great Tesla Exhibit. The exhibit covers 2/3rds of the first floor and includes, among other things, a prototype of the Semi, Cybertruck and a Roadster. Very informative we spent almost 2 hours there.
After leaving my fellow "gearhead" friend said he now "got it"

Tesla | Tesla Cars at the Petersen Museum Exhibition — Petersen Automotive Museum

Come see the most comprehensive collection of Tesla cars and artifacts ever curated! This exhibit traces the Tesla’s story from fledgling startup to EV juggernaut and explores the range of its products, the breadth of its manufacturing capabilities, and its irrefutable impact on the modern transport

www.petersen.org

 

[ZeApelido]

The Cybertruck Ram 1500 REV will start an EV revolution.

Ram claims it's starting a 'revolution' with 1500 REV all-electric pickup truck

Ram officially announced the Ram 1500 REV, its first all-electric pickup truck, today, and the company claims that it is...

electrek.co

 

[H Mak]

At some point, Model X and Model S production just won’t make sense.

How are the astronauts meant to get to the rocket?

 

[Ogre]

How are the astronauts meant to get to the rocket?

Are you kidding? Cybertruck of course, it’s even color coordinated with their latest rocket.

 

[AndrewZ]

BRAND PERCEPTION - this - My wife will pay £2000 ($2500?) for a leather handbang... very nicely made..but worth £300.. There you go - it’s all about the brand.

This is getting way OT but I’d love to see a cost analysis that breaks down $300-400 cost plus markup on what I’d assume is full grain leather hand cut and stitched by people who probably have 10-20+ years of experience and already become rarer every year. Whether or not that’s of value to you, that’s up to the beholder, but I am sure it costs a lot more than that.

MartinAustin uses Lamborghini as an example above, I’d recommend finding and listening to what Munro & Associates say about the quality of materials and methods observed when tearing down a Lamborghini. Yes it’s associated with certain things and people, but the product itself is approached entirely differently than mass production, simplification, ease of manufacturing, automation, etc. Both have their own challenges to overcome.

 

[jkirkwood001]

Just posted this over in the Investor Day thread if anyone cares to answer there:

Just throwing this out there:

Imagine if they announce not one, but THREE Gigafactory locations?​

Why is this a possibility?

1. We've had strong indications that the new Gigafactory location would be in Quebec, Canada.
2. No wait, then we heard the new Gigafactory location would be in Indonesia.
3. No wait, then we heard the new Gigafactory location would be in Mexico
4. The first two offer gateways to key markets AND access to key battery minerals (Mexico I understand the least - besides lower labour costs, what's the advantage of Nuevo Leon or Hidalgo compared to continuing to grow Gigafactory Texas?)
5. We know that Master Plan Part Trois is all about massive scale. Is one Gigafactory 'massive scale'? No. THREE is massive scale.
6. IMO, we've had a dearth of new commitments in the last year or so (Semi was announced 2017, CyberTruck in 2019). To keep with Tesla's incomparable ambition, we need dramatic new goals for the troops, AND for TSLA.
7. Battery Day was 2 1/2 years ago - c'mon! You've got to ramp faster!
8. Um, what else you gonna do useful with +$20 B in cash???
9. There's a recession coming, 'member? A recession is a great time for capital investing that will ripen at the exit of the recession.
10. Last but not least, it's kickass cool. And Elon likes making statements / stretch goals, like when he said the Roadster would be a "hardcore smackdown to gas-powered cars"

Con arguments?

• Investor Day is about incentivizing investors. It's more likely de-mystifying 'Model 2', Robotaxi, or FSD rollout (i.e. production / go-live plans) would excite investors more. New factories are about growing COGS in the near term, not increasing revenue.