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

[GhostSkater]

I didn't understand then either, but I think I get it now. They're probably slowing down their ramp-up because they forecasted a slowdown in purchases this year due to macroeconomic factors. If their demand forecast ticks up later this year, Tesla will have a more aggressive production growth target for next year.

Might be

But this goes against what Elon said

"If needed we will sell for zero margins but won't slow the ramp or production speed"

 

[Maarten]

Ending today at USD 160. Could we be finishing tomorrow at USD 165?

 

[MP3Mike]

This was already debunked a couple hours ago in this very thread- see here:

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

Wait .... I don't have to tell you all this. Tesla clearly said during ER they will cut prices to move the cars. If need be all the way to 0% GM ... Well , what he actually said was it's something they could do, given their unique position to profit from autonomy: Elon Musk Well, I can't...

teslamotorsclub.com

and

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

Wait .... I don't have to tell you all this. Tesla clearly said during ER they will cut prices to move the cars. If need be all the way to 0% GM ... Well , what he actually said was it's something they could do, given their unique position to profit from autonomy: Elon Musk Well, I can't...

teslamotorsclub.com

No, it was not debunked, as none of those sources acknowledged the existence of the trade agreement, Comprehensive Economic Partnership Agreement (CEPA), between India and South Korea. Which greatly reduces the import tariff. (From Wikipedia: "South Korean car manufactures will see large tariffs cuts to below 1%")

 

[Carl Raymond]

ME WANT NOW!!!

https://twitter.com/x/status/1651635311791808529

Nice look, but I don’t believe that design will work. It’s the A frame profile that gives Cyber its strength. Connecting The Dots covered this with paroxysms of detail.

See 17:00 minute mark.

 

[Ogre]

Tesla's business model is direct to customer. As far as I know, they don't plan, and don't have, space to store inventory. The inventory is a result of canceled orders.

A ship filled with cars is “inventory”. Cars on a train to the final delivery point is “inventory”. Cars in a service center being cleaned and prepped for delivery “inventory”.

The more cars you produce, the more are in each of these steps of the process. The more delivery locations you have, the more logistics and en-route vehicles you have. Tesla does not have a separate “in transit” category. It is all “inventory” and there is a direct relationship between production and the number of vehicles you have in transit.

Don’t think we need to debate semantics here. I agree there's a difference, but most people will be able to claim $7,500 off.

It’s not semantics. There is $150 difference in payments. This will disqualify many buyers. The delay between purchase and refund is also significant (1/6th of ownership of the vehicle). If you think it’s semantics, how about you lend me $7,500 I can use as a down payment until next tax season interest free?

What do you mean by 'almost instantly'? The price wasn't $66k until June, but the price increase was a gradual build-up, and the wait time was a gradual reduction. There was no instant change as you implied. Regardless, you seem to agree that Tesla cut prices because demand at the old prices was too low, so you are not the intended audience of my facetious post.

Price increase happened in June…. For the next 6 months Tesla was still servicing deliveries from orders prior to the increase. Come December **when June orders were finally being serviced** deliveries crashed hard. Very clear evidence consumers had no appetite for $66k Model Ys.

Put another way, the backlog stopped growing—deliveries were happening faster than orders—when prices got over $65k. It took 6 months for the backlog from prior orders to empty.

 

[bkp_duke]

No, it was not debunked, as none of those sources acknowledged the existence of the trade agreement, Comprehensive Economic Partnership Agreement (CEPA), between India and South Korea. Which greatly reduces the import tariff. (From Wikipedia: "South Korean car manufactures will see large tariffs cuts to below 1%")

If the Tariffs were 1%, why would SK be negotiating to reduce them?

Early upgrading of CEPA is key to taking Korea-India ties to next level

After establishing diplomatic ties in 1962, economic exchanges started blossoming between Korea and India. Initially the focus was on textiles, steel, and chemicals. A shift came in the 1980s when Korean companies began investing in India's automobile and electronics sectors. Daewoo Motors had...

www.koreatimes.co.kr

 

[jerry33]

I never understood their 1.8M goal, even 2M is barely any ramp everywhere

Basically means that all the lines that are running on all factories are at or close to max capacity, and that second line for Model Y in Texas and Berlin will not show significantly volume until next year

Cybertruck it's fine and expected to ramp slowly

My thought is that the 1.8M is for Wall Street's benefit.

 

[StarFoxisDown!]

Google trends for 3/Y are showing a big increase over the past month. The big positive is this seems to be a slower, more organic ramp than the instantaneous jump on January price cuts.

Up 69% since Mid March local min, up 147% from Thanksgiving bottom, and up 58% from a year ago. More importantly, recent rise in last month seems more gradual buildup than the sharp rise due to January price cut announcement.

View attachment 932460

https://twitter.com/x/status/1651688442819141633

I can't remember off the top of my head. Was there a price cut in mid March that caused that turnaround?

 

[willow_hiller]

Didn't see this posted, yet. We know Tesla has high rates of brand loyalty, so high volumes of used Teslas entering the used market also likely means that equally large volumes of new Teslas being purchased to replace them:

CarMax: Tesla is the most popular pre-owned brand as EV interest spikes

CarMax, the largest used car retailer in the US, is seeing a huge spike in electric vehicle interest. In its annual EV consumer report, CarMax found that search volume for the word “electric” doubled from February of last year to this year, when the retailer compiled data for its last EV report.

finance.yahoo.com

In its annual EV consumer report, CarMax revealed that search volume for the word “electric” doubled from February 2022 to February 2023, when the retailer compiled data for its last EV report. ... According to CarMax sales data from February 2023, the top five most popular EVs were the Tesla Model 3, Tesla Model Y, Nissan Leaf, Ford Mustang Mach-E, and the Chevrolet Bolt EV. ... One more interesting nugget from CarMax data: the most common vehicles traded in for a Tesla Model 3 were the Honda Civic and Toyota Tacoma pickup.

How many of those former Tacoma pickup owners are likely to buy a Cybertruck?

 

[Artful Dodger]

BYD profit falls 43.5 per cent amid car-market price war​

"BYD is so much ahead of Tesla in China ... it's almost ridiculous." -- Charlie Munger (Feb 15, 2023)

Almost.

 

[mongo]

If the Tariffs were 1%, why would SK be negotiating to reduce them?

Early upgrading of CEPA is key to taking Korea-India ties to next level

After establishing diplomatic ties in 1962, economic exchanges started blossoming between Korea and India. Initially the focus was on textiles, steel, and chemicals. A shift came in the 1980s when Korean companies began investing in India's automobile and electronics sectors. Daewoo Motors had...

www.koreatimes.co.kr

"Korea is asking for a quicker tariff reduction period than is being offered by India."

That's strange, per the copy of CEPA I found, the tariff should have been elimiated after 8 years (so 2018 or so). The article also has "Both countries started talks to upgrade the CEPA in 2015" so maybe the tariff timing is stale information?

 

[MC3OZ]

If true, this would be an absolute BOSS move. The labor force is excellent and reasonably priced (but not China or MX level cheap). The supply chains are fantastic and anything not local can probably be brought in from the mature China supply chain until the local one is built up.


EDIT - per post by @EVNow I did some further digging, and the above does not appear to be true.

Reuters article here has a good summary (shocking, I know):

India raises tax on imported cars, motorbikes, including EVs

India on Wednesday said it will raise taxes on imported cars and motorbikes, including electric vehicles (EVs), as it seeks to boost local manufacturing in line with Prime Minister Narendra Modi's "Make in India" campaign ahead of elections in 2024.

www.reuters.com

Making Gen3 cars in South Korea for export is a good move regardless of the volumes that end up going to India.

Indian tarrifs apply to all cars, so a Tesla Gen3 isn't at a relative disadvantage.

The relevant question is :- "What other EV options do Indian buyers have, and what is their budget?"

Perhaps the volumes of Gen3 in India will initially be more like sales volumes in Singapore. There just needs to be enough volume to justify entering the market.

 

[bkp_duke]

"Korea is asking for a quicker tariff reduction period than is being offered by India."

That's strange, per the copy of CEPA I found, the tariff should have been elimiated after 8 years (so 2018 or so). The article also has "Both countries started talks to upgrade the CEPA in 2015" so maybe the tariff timing is stale information?

Yeah, it's confusing for sure. One article I read mentioned 9 separate re-negotiations after CEPA was agreed up on, so I'm not sure on what the exact tariffs are. You would think that would be of record, but the 1200+ page document I downloaded . . . wasn't easy.

 

[Krugerrand]

Well your solar

Solar yield should be amazing, project sounds fun. Explosives definitely the way to do it if you do an expansion fortification

Solar coming of course.

 

[bkp_duke]

Making Gen3 cars in South Korea for export is a good move regardless of the volumes that end up going to India.

Indian tarrifs apply to all cars, so a Tesla Gen3 isn't at a relative disadvantage.

The relevant question is :- "What other EV options do Indian buyers have, and what is their budget?"

Perhaps the volumes of Gen3 in India will initially be more like sales volumes in Singapore. There just needs to be enough volume to justify entering the market.

My concern is the most populous nation in the world, with a long-standing history of poor environmental acumen, holding on to ICE for as long as possible. Doesn't press forward with the mission.

 

[mongo]

Yeah, it's confusing for sure. One article I read mentioned 9 separate re-negotiations after CEPA was agreed up on, so I'm not sure on what the exact tariffs are. You would think that would be of record, but the 1200+ page document I downloaded . . . wasn't easy.

I may have been looking at the wrong commodity code.

 

[Ogre]

"BYD is so much ahead of Tesla in China ... it's almost ridiculous." -- Charlie Munger (Feb 15, 2023)

Almost.

I got nothing against octogenarians… but not usually who I turn to when I have questions about cutting edge technology.

Munger and Buffet understand some fundamentals of investing quite well, but the investing which has made them money over the years has never been bleeding edge tech. The closest them come to that is Apple… which they bought nearly a decade after they should have.

 

[Singuy]

Oh man, don't know what is going on with Amazon's earnings call but I'm pretty sure Musk is on it. Who else can derail a rally of 10% after ER during the call and then tank it to red?

 

[MP3Mike]

If the Tariffs were 1%, why would SK be negotiating to reduce them?

Early upgrading of CEPA is key to taking Korea-India ties to next level

After establishing diplomatic ties in 1962, economic exchanges started blossoming between Korea and India. Initially the focus was on textiles, steel, and chemicals. A shift came in the 1980s when Korean companies began investing in India's automobile and electronics sectors. Daewoo Motors had...

www.koreatimes.co.kr

Maybe they aren't 1% anymore, but the point is that as far as I can tell the tariff is not 100% for vehicles imported from South Korea. So having a GigaFactory there absolutely would bypass the 100% tariff. (Which is what was said.)

Wasn't Elon asking for them to make it 40% for EVs? Does the current terms in CEPA put the tariff anywhere close to that?

 

[bkp_duke]

Maybe they aren't 1% anymore, but the point is that as far as I can tell the tariff is not 100% for vehicles imported from South Korea. So having a GigaFactory there absolutely would bypass the 100% tariff. (Which what was said.)

Wasn't Elon asking for them to make it 40% for EVs? Does the current terms in CEPA put the tariff anywhere close to that?

Honestly, I don't know what the current CEPA tariff is. I would love to find a source from say the last 3 years, because it looks like it keeps getting re-negotiated.