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

[Webeevdrivers]

Interesting how you are worried about not able to charge but not worried about not able to get service if Rivian goes under. The company is burning near 6 billion a year and that's after some account shenanigans, they are losing over 7billion a year from operations. Their runway is less than 2 years.

Yah, good point. It’s a ways off in the future. By then we’ll probably all know better how Rivian is going.

 

[Singuy]

Rivian guided for a -4.5B adjusted Ebitda loss for 2022. They ended up with -5.217B. They are guiding for -4.3B ebitda loss for 2023.

Tesla have never surpass an Ebitda loss of over -0.5B over a trailing 12M time frame. Just to point things in perspective. Rivian in 1 year have lost more money than Tesla have loss ever since IPO.

But rIVian iS a STarT uP aNd loSes moNEy jUSt liKE teSLA is a moronic statement.

 

[Xepa777]

While Monterrey has had it's share of difficulty with drug cartels, specifically the Zetas, I am confident that Tesla has done its homework and found a way to mitigate this, and other challenges involved in placing a Gigafactory there. If there were difficulties, I doubt Ford would be making MachE's there.

Or maybe Ford's just comfortable "playing politics" which is why you never hear about anything.

Also, from Reddit, good Rivian summary:

"

RIVN earnings highlights

• ⁠will no longer announce preorder numbers

• ⁠lost $1.72BN last quarter

• ⁠produced 10,020 vehicles last qtr. that comes out to losing $171,657 per vehicle produced. Maths

• ⁠projected to lose $4.3BN 2023

• ⁠63k 2023 production expected and 50K guided

• Interestingly, they continue to grow revenue QoQ consistently as you'd expect from increased sales but their FCF keeps getting worse.

• The best part is they still claim they will be able to make a gross profit in 2024 "

 

[JRP3]

Almost looks like they are goin to lift the car on something.

They used the crane to lift those metal ramps in place, you can see it at 2:15 in the video. I'm thinking maybe Cybetruck will be on the ramps.

Edit: Actually it looks as if they are moving the metal ramps to a platform or trailer on the road, strapping one at the 1:44 mark then moving to to the road.

 

[Singuy]

Or maybe Ford's just comfortable "playing politics" which is why you never hear about anything.

Also, from Reddit, good Rivian summary:

"

RIVN earnings highlights

• ⁠will no longer announce preorder numbers

• ⁠lost $1.72BN last quarter

• ⁠produced 10,020 vehicles last qtr. that comes out to losing $171,657 per vehicle produced. Maths

• ⁠projected to lose $4.3BN 2023

• ⁠63k 2023 production expected and 50K guided

• Interestingly, they continue to grow revenue QoQ consistently as you'd expect from increased sales but their FCF keeps getting worse.

• The best part is they still claim they will be able to make a gross profit in 2024 "

If Rivian today sells 10k paper picture of a Rivian for MSRP of their current truck in addition to their real truck deliveries, they still wouldn't have a gross profit.

 

[Ogre]

Just to point things in perspective. Rivian in 1 year have lost more money than Tesla have loss ever since IPO.

Painful truth here. Rivian is a nice truck.

It’s not a nice investment.

 

[bkp_duke]

Wait sorry can we clarify the quarter? Do you mean Q1 2023? I'll do that bet. Friendly bet of course =) It's in my best interest to be wrong here.

I'll do that deal. Anything above 18% Automotive margins for Q1 2023 and i'll Paypal the cash equivalent of 1 Tesla share. Anything below 18% and you can paypal me.

So, bringing this back up here for people to give feedback on. @MrMoo has PM'd me saying:

Hey I've had some time to crunch some numbers in regards to the price increases Tesla did about 4 weeks ago (Plus the other price bumps they have done since then) and I need to respectfully ask if we can cancel this bet as I believe there is a chance they can get to 18% Auto GM now that they have reverted about 18% of the cut on the model Y.

What does everyone think? Is Tesla raising prices a small bit, compared to the massive drop they did in Jan, reason enough to invalidate a bet like this?

 

[FireMedic]

Painful truth here. Rivian is a nice truck.

It’s not a nice investment.

Is it though? Heard lots of stories of it getting bricked in cold conditions (“Now you know” YouTube video), and to me it looks like something out of Mickey Mouse club. It’s cute, I guess…but in a silly sort of ridge line way. And service is a real long term risk ala tesla cars in 2010. I know looks are trivial/subjective/irrelevant, I just don’t see how it’s any better than the Ford Lightening.

 

[unk45]

Or maybe Ford's just comfortable "playing politics" which is why you never hear about anything.

Also, from Reddit, good Rivian summary:

"

RIVN earnings highlights

• ⁠will no longer announce preorder numbers

• ⁠lost $1.72BN last quarter

• ⁠produced 10,020 vehicles last qtr. that comes out to losing $171,657 per vehicle produced. Maths

• ⁠projected to lose $4.3BN 2023

• ⁠63k 2023 production expected and 50K guided

• Interestingly, they continue to grow revenue QoQ consistently as you'd expect from increased sales but their FCF keeps getting worse.

• The best part is they still claim they will be able to make a gross profit in 2024 "

Some large operations there have low interference from ‘extra-legal’ operations. From evidence I saw it seems they’re more interested in drugs than in business impediments. Of course I was only there a few months so could have simply been too ignorant. I doubt it since such things are usually pretty obvious to careful observers.

 

[JRP3]

Elon being chastised by the CCP, I expect negative headlines tomorrow to try and push the stock down.

Chinese state-linked paper lashes out at Elon Musk over lab leak theory

The warning came in an editorial published Monday by Global Times, a tabloid owned by the ruling Chinese Communist Party.

www.nbcnews.com

A Chinese state-run media outlet has issued a word of warning to Elon Musk: Be careful about how you talk about China.

The warning came in the form of an editorial published Monday by Global Times, a state-backed nationalist tabloid.

 

[wipster]

So, bringing this back up here for people to give feedback on. @MrMoo has PM'd me saying:


What does everyone think? Is Tesla raising prices a small bit, compared to the massive drop they did in Jan, reason enough to invalidate a bet like this?

Nope. A bet's a bet. He clarified it would be for the whole quarter and price changes were almost guaranteed to happen.

 

[Tony73]

Don’t believe Tesla has ever sold a car at negative gross margin. Not even back in 2012/2013.
Rivian and Lucid are in big trouble.

 

[Ogre]

Is it though? Heard lots of stories of it getting bricked in cold conditions (“Now you know” YouTube video), and to me it looks like something out of Mickey Mouse club. It’s cute, I guess…but in a silly sort of ridge line way. And service is a real long term risk ala tesla cars in 2010. I know looks are trivial/subjective/irrelevant, I just don’t see how it’s any better than the Ford Lightening.

The Rivian owners I know love them.

But more generally, I just don't like to crap about any cars which lack exhaust pipes. I want these companies to succeed.

Well unless they have a bowtie on them. I talk a lot of crap about bowtie company cars.

 

[GOVA]

Painful truth here. Rivian is a nice truck.

It’s not a nice investment.

No, it is just the truth.

It is painful for those who did not do the due dilligence to find out how to separate themselves.

 

[Ogre]

No, it is just the truth.

It is painful for those who did not do the due dilligence to find out how to separate themselves.

Painful for anyone invested in Rivian. Or potentially Rivian owners who may end up with a truck with no maker to support it.

Don’t believe Tesla has ever sold a car at negative gross margin. Not even back in 2012/2013.
Rivian and Lucid are in big trouble.

Rivian, Lucid, and company followed in Tesla’s footsteps and tried to use the strategy which worked for Tesla. Only the market has changed since then. And it barely worked for Tesla. If Tesla hadn’t been incredibly disciplined about spending and had truly remarkable engineering talent, they’d have never made it. There was a tiny window, they were too slow to hit it, and would have been too fat to squeeze through regardless.

 

[Artful Dodger]

Looks like a few SuperChargers in New York and 1 in California also some wall chargers sprinkled around the US. Rates are about 10 cents higher per kWh without a membership.

View attachment 912384View attachment 912385

How much does a Tesla owner pay for Supercharging at those sites?

 

[Cosmacelf]

Rivian, Lucid, and company followed in Tesla’s footsteps and tried to use the strategy which worked for Tesla. Only the market has changed since then. And it barely worked for Tesla. If Tesla hadn’t been incredibly disciplined about spending and had truly remarkable engineering talent, they’d have never made it. There was a tiny window, they were too slow to hit it, and would have been too fat to squeeze through regardless.

Tried to use Tesla’s strategy, but totally bolluxed it up. Part of Tesla’s strategy was to not grow stupidly. They never overhired (or at least not at the extreme level that Rivian and Lucid have), and didn’t spend money they didn’t need to (like producing lavish marketing videos when you have a two year backlog).

Rivian had managers inside that were ringing the alarm bell that their costs and end user pricing were totally out of whack almost a year before they tried to adjust their pricing. And then they blinked and rolled back their pricing, the worst possible decision they could have made. They lost goodwill and $1B.

Turns out that running a startup is hard. Who knew, eh?

 

[Cosmacelf]

Rivian Q4 numbers (pdf)

"We generated negative gross profit of $(1,000) million for the fourth quarter 2022. For fiscal year 2022, we generated negative gross profit of $(3,123) million. Gross profit for the fourth quarter 2022 was impacted by a lower of cost or net realizable value (“LCNRV”) of inventory charge and losses on firm purchase commitments of $920 million as of December 31, 2022 compared to $95 million as of December 31, 2021. We expect to continue to incur these charges throughout 2023 but anticipate the total charge will decline as we drive down cost of goods sold per vehicle by lowering material, production, logistics, and other costs. We forecast reaching positive gross profit in 2024 and therefore expect that by the end of 2024, we will no longer have material LCNRV inventory charges and losses on firm purchase commitments associated with our Normal facility."

https://assets.rivian.com/2md5qhoeajym/5TBOuPTvDNZwGjUte1Vp1M/d789f042ab663f6766491f028ef8378f/Rivian_Q4-2022_Shareholder_Letter.pdf

Can someone explain that paragraph to me? What the heck is LCNRV?

 

[MP3Mike]

How much does a Tesla owner pay for Supercharging at those sites?

I would clarify that Tesla charges Tesla vehicles $0.39/kWh and charges non-Tesla vehicles $0.49/kWh at the sites in NY that I checked. Even if they are owned by a Tesla owner.

 

[Singuy]

Painful for anyone invested in Rivian. Or potentially Rivian owners who may end up with a truck with no maker to support it.


Rivian, Lucid, and company followed in Tesla’s footsteps and tried to use the strategy which worked for Tesla. Only the market has changed since then. And it barely worked for Tesla. If Tesla hadn’t been incredibly disciplined about spending and had truly remarkable engineering talent, they’d have never made it. There was a tiny window, they were too slow to hit it, and would have been too fat to squeeze through regardless.

Apparently they missed the part when Elon fired the CEO immediately after finding out that it cost more to make the roadster than they were charging.

A negative gross margin business is not a business, it's a charity.