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

[Ogre]

It only requires that a buyer *observe* that new ICE is no longer the best buy. Frictionless and sudden.

If you own a 3-10 year old car that is reliable, it is quite easy to put off a purchase for 1-3 more years while the market settles a bit. The likelihood there will be significantly better deals on EVs in 2-3 years is nearly 100%. The high interest rates we're seeing at the moment make it even more likely people will put off a purchase for a year or two.

I strongly suspect there are a lot of people hanging onto their ICE car for a couple more years while they get ready for their EV purchases.

I was thinking the used ICE market would crash, but starting to think they will have a long tail as new car sales fall off a cliff and economies of scale invert on cars like the Corolla. My mechanic buddy will have plenty to keep him busy for another 10 years before he retires.

 

[Optimeer]

interesting data.

You can see that with right hand drive cars, UK, unlike rest of Europe, is still stuck in the "wave".

Wondering when/if Berlin will commence RHD manufacture to solve this, or if Tesla will just keep RHD production in China long term.

While this is possible, I think the data points for April 2023 were not available for the countries without a column in April 2023 (Germany, UK, Belgium Spain, Switzerland). The Swiss numbers are actually out now and are also a record for the first month: 475 out of total 18’149 cars registered in April are Tesla cars. Tesla’s Market share in April is 2.6 % of all cars (quite good for the first month of a quarter) and 18.6 % of all newly registered cars are BEV‘s!

 

[generalenthu]

If you own a 3-10 year old car that is reliable, it is quite easy to put off a purchase for 1-3 more years while the market settles a bit. The likelihood there will be significantly better deals on EVs in 2-3 years is nearly 100%. The high interest rates we're seeing at the moment make it even more likely people will put off a purchase for a year or two.

I strongly suspect there are a lot of people hanging onto their ICE car for a couple more years while they get ready for their EV purchases.

I was thinking the used ICE market would crash, but starting to think they will have a long tail as new car sales fall off a cliff and economies of scale invert on cars like the Corolla. My mechanic buddy will have plenty to keep him busy for another 10 years before he retires.

No kidding. pull up a 5 yr chart of Autozone (AZO, no position). They will be doing very well for the next few years as used cars are kept on the roads for longer and longer.

 

[UncaNed]

Nobody writes an article about the fish market charging "Market Price" for Swordfish after all.

Page Analysis » Selina Wamucii

See updated April 2024 prices for US Swordfish per kilogram (Kg) and per pound(lb). Updated Daily.

www.selinawamucii.com

Couldn't help myself.

 

[Optimeer]

I admire Ford for their transparency in reporting out the EV division. This was a particularly tough quarter for that division with Tesla dropping the price hammer. You can see the challenge (that folks have been talking about for years here) Ford has....The Blue and Pro divisions are funding the Model e division. Every EV they sell is currently bleeding money. Heck, you could indeed make an argument that Ford should stop selling this generation of EVs until they can be more profitable, but they lose mindshare and it is hard to get that back.
The biggest immediate risk I see to Ford isn't that their EV division doesn't get profitable fast enough...it's that a recession tanks their ICE profits and the funding for EV growth and improvement dries up. Tick, tock Ford....tick, tock.

This transparency probably happened for a reason. The IRA tax credit was halved on April 18th and will completely disappear in my opinion by beginning of 2024 for the Mach E‘s with Chinese LFP Batteries. I think the message is that additional support is needed to further being able to push the transition to EV‘s. If no help arrives, this is the rationale that the ramp for cars from Ford with chinese LFP Batteries (at least some of the Mach-E Models and of the Ford Transit) will not happen.

It seems that all EV‘s which do not profit from economies of scales from American companies are having huge negative margins. We do not have a lot of data from the European manufacturer. At higher quantities, the margins probably do improve a bit but the net loss does get even higher.

 

[nativewolf]

If Ford was ahead of GM then it would have its first Gigafactory built ahead of the already completed GM Lordstown GF.

They made a deal with CATL for LFP because there was no lithium ion batteries left to buy on the open market.

They made a deal with CATL on the heels of two SK deals and the deal they made was to get IRA favorable batteries and control thus it is a technology transfer agreement where Ford owns plant makes cells and packs - quite unlike the Tesla/pano agreement on GF1. It appears to be a smart agreement in that it gives Ford the opportunity to learn how to actually make batteries, source materials, etc. There are plenty of batteries coming on line in 2 years and Ford has shown it has enough capacity locked up to transition. Unlike some. Interestingly it was AFTER Ford did that deal that Tesla announced their own agreement on exactly the same terms with CATL. Pano did not transfer technology to Tesla, they build cells and Tesla builds packs.

Ford has already passed GM, they have to get more models out and they need to ramp production of the F150 which will significantly ramp this fall as new lines come on board but they have much more velocity than GM at this time. I have some small hope Ford actually completes the transition. GM appears hopeless to me. GM was building the Volt/Bolt back when the 3 just launched and where are they now? Behind Ford. Ford is in the hard business of splitting the company into legacy ICE and EVs. They have grasped that it is all about batteries, moved very very adroitly there. They have a workable truck that gets a revamp in 2 years but they got it launched before Tesla. So much left to do but I think they can make it, especially in trucks and SUVs.

 

[nativewolf]

This transparency probably happened for a reason. The IRA tax credit was halved on April 18th and will completely disappear in my opinion by beginning of 2024 for the Mach E‘s with Chinese LFP Batteries. I think the message is that additional support is needed to further being able to push the transition to EV‘s. If no help arrives, this is the rationale that the ramp for cars from Ford with chinese LFP Batteries (at least some of the Mach-E Models and of the Ford Transit) will not happen.

It seems that all EV‘s which do not profit from economies of scales from American companies are having huge negative margins. We do not have a lot of data from the European manufacturer. At higher quantities, the margins probably do improve a bit but the net loss does get even higher.

The transparency happens because Ford is going to split the company.

 

[nativewolf]

I admire Ford for their transparency in reporting out the EV division. This was a particularly tough quarter for that division with Tesla dropping the price hammer. You can see the challenge (that folks have been talking about for years here) Ford has....The Blue and Pro divisions are funding the Model e division. Every EV they sell is currently bleeding money. Heck, you could indeed make an argument that Ford should stop selling this generation of EVs until they can be more profitable, but they lose mindshare and it is hard to get that back.
The biggest immediate risk I see to Ford isn't that their EV division doesn't get profitable fast enough...it's that a recession tanks their ICE profits and the funding for EV growth and improvement dries up. Tick, tock Ford....tick, tock.

They closed the truck line as part of expansion, so they took a hit. By november/december they numbers should be improving.

 

[insaneoctane]

Sure, but before long—particularly with tiny bumps like this one—the media will stop covering every single change.

I seriously doubt this will get a ton of coverage the way the big drops earlier in the year did. Particularly since it doesn't fit the narrative that Tesla is losing share and desperately dropping prices to avoid massive inventory build ups.

Are you sure?

"Tesla drops prices by $250 due to demand problems..."

"Tesla raises prices $250 due to collapsing margins..."

Personally, I don't think they can help themselves.

 

[Zero CO2]

The transparency happens because Ford is going to split the company.

Yes but when to make the split ? ... . that is the question ... .... hence the dilemma ....all three Ford units are vying for limited capital ...

 

[insaneoctane]

...Net they lost $60K+ per electric car! The ASP average at $58K. This means their average all in cost was close to $120K!!!

They started selling the Mach-e in December 2020. They've been mass producing automobiles for 110 years. Hmmmm.

 

[Ipcress]

Corolla appears to be more than a sedan, if the tweet below is accurate.

When I look at those figures I don’t see a decade trend, I see a recent cliff. Still chip constrained? Ok then. I’ll keep watching and posting if other popular models show this cliff.

Fundamentally the situation is misunderstood out there. It does not require an EV produced to obviate a legacy ICE sale. It only requires that a buyer *observe* that new ICE is no longer the best buy. Frictionless and sudden.

https://twitter.com/x/status/1653166396891709442

Also--those cars are just unbelievably ugly.

 

[Carl Raymond]

Also--those cars are just unbelievably ugly.

Grilles are ugly. They shout “I have a waste heat problem”.

 

[Drumheller]

Much as I am skeptical of certain recent actions and announcements by Tesla, and pessimistic on the short-term valuation of TSLA the stock, Tesla is the most, if not only, viable EV maker to still be around in 10 years. Market cap may never go above $500B, but at least it will not go to zero.

If you believe Tesla's market cap may never go above $500B, why are you here?

 

[Thekiwi]

5K/wk is close to the nominal capacity of the 1st GA assembly line. The next significant stepup will be to ~10K with the 2nd GA line, which depends upon Stamping-2 being complete (and possibly local bty cell production). I'd look for it in 2023H2 (per Tesla).

Tesla actually listed Berlin at “>350,000” in the earnings shareholder deck, which is ~7,000 per week.

 

[TN Mtn Man]

They started selling the Mach-e in December 2020. They've been mass producing automobiles for 110 years. Hmmmm.

But...the media analysts and financial experts has been telling us for years, that as soon as "legacy" auto, with their century of manufacturing experience started building EVs, they were going to steamroller Tesla.

 

[Ogre]

They don't breakout the gross margins for EV's in the earnings report. Possibly the 10K will have it.

Net they lost $60K+ per electric car! The ASP average at $58K. This means their average all in cost was close to $120K!!!

I’m really not trying to defend Ford here… really.

They really have no choice. They got into this game entirely too late to screw around. I’d be more concerned if Ford wasn’t burning crazy amounts of cash on their EVs.

While investing a ton of money doesn’t guarantee they will be successful, not investing a ton of money at this points guarantees they will fail.

 

[Thekiwi]

Norway 377 USD / month - not sure of interest rate after first 3 years

https://twitter.com/x/status/1653444391359348739

to follow up on this: Alexandra / Teslaboomermama has been doing a lot of great analysis of tesla, and today on a tesla bulls podcast mentioned that someone from tesla recently reached out to her about all her recent twitter posts about auto financing & the advantages of tesla offering its own finance etc, got her to explain some details, and said they intend to “do something with it”.

Part of me is somewhat surprised that Tesla perhaps doesn’t have its own team internally that can figure this stuff out, but I love that they reach out to knowledgeable people on Twitter when they see a good idea.

 

[MP3Mike]

You can now order the Model 3 LR in the US again:

But it must not be using Panasonic 2170 cells, as it only qualifies for a $3,750 tax credit and the range is listed as 325+, so it doesn't have an official EPA rating yet:

 

[Thekiwi]

You can now order the Model 3 LR in the US again:

View attachment 934032

But it must not be using Panasonic 2170 cells, as it only qualifies for a $3,750 tax credit and the range is listed as 325+, so it doesn't have an official EPA rating yet:
View attachment 934033

Interesting the performance gets the full tax credit, but the LR only gets half - I guess they have shoehorned LFP into the LR??? Has less range than the Model Y LR, so adds up to an LFP solution.