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

[navguy12]

This seems to... really misunderstand....like, all parts of how either thing works though?

Lithium does not fuel your car.

Lithium helps you store fuel for your car. Which is electricity (and which is still largely created via fossil fuels today, though an increasingly smaller % of them over time).


None of which changes the fact the mining and environmental impacts of gas cars are vastly worse than EVs, but the lithium=fuel analogy you give, and I've seen many give it, just...should not be a thing.

The battery isn't fuel, it's the fuel tank.

You are overthinking it.

In a social setting where it is impractical to spend the time to review the minutiae on just how things work (try explaining kWh to an ICE driver sometime), the quick counterpoint to the “problem” with EV minerals mining is to indicate the continued non-stop mining requirements for ICE versus the single mining solution for an EV.

 

[Artful Dodger]

Tesla buys 100% of the battery cells it puts in its current products from foreign companies

Perhaps you could provide a list of all the U.S. companies making lithium ion batteries for automotive applications? I'll start you off:

1. Tesla:
   1. Texas Model Y AWD (until recently)
   2. Cybertruck (imminent)
   3. Semi (2024 at Giga Nevada)
2. ???

TIA.

 

[TSLA Pilot]

This seems to... really misunderstand....like, all parts of how either thing works though?

Lithium does not fuel your car.

Lithium helps you store fuel for your car. Which is electricity (and which is still largely created via fossil fuels today, though an increasingly smaller % of them over time).


None of which changes the fact the mining and environmental impacts of gas cars are vastly worse than EVs, but the lithium=fuel analogy you give, and I've seen many give it, just...should not be a thing.

The battery isn't fuel, it's the fuel tank.

This sub-thread is informative and seemingly demonstrates how accurate the Dunning-Kruger Effect is. The mass of humans are remarkably gullible and easily swayed when it comes to things they know next to nothing about. That said, there is some argument:

The Dunning-Kruger Effect Isn’t What You Think It Is

The least skilled people know how much they don't know, but everyone thinks they are better than average

www.scientificamerican.com

I too often hear these remarkable "arguments" against EV's, arguments based upon fiction, but it's what we have to deal with. Thus far, I think that Tesla's demand is still somewhat close to supply, thankfully.

For those dealing with this sort of BS, I recommend sending the ignorants to this site for details on where their thinking is woefully inaccurate and not fact-based:

www.tesla.com/impact

 

[navguy12]

You're indeed correct...but the folks on the other side of the argument comparing lithium to gas might be better convinced (if it's possible to convince them) just comparing mining to mining, or weights to weights, even if the items aren't exactly analagous. The real trouble is that they literally have no idea about the current state of things in terms of the mining or mass of stuff the ICE economy requires.

For example:

Comparing an entire lithium ion battery vs gasoline:
- That battery weighs about 1000 lbs (very round number estimate). People have a feel for what 1000 lbs is, and they think it is a lot.
- Well, how much gasoline does your car burn? Most people literally never see the gasoline that goes into the car, or where it goes, and have no idea how much it actually is. Make them realize the numbers and MAYBE they'll make a connection. My first line on this: the Tesla's battery is warrantied for 120,000 miles (or whatever it is for your car), and is expected to last much much longer. But, sticking just with that 120,000 mile warranty -- how much gasoline does it take to go that far? If their car gets 30mpg, then it takes 4,000 gallons of gas to go 120,000 miles. 4,000 gallons of gas would weigh about 24,000 pounds...and it just gets burned up and sent into the air as ~75,000 pounds of CO2, plus other worse things. Hey Mr. EV_Hater: are you really comparing a recycleable 1000lb battery to the 24,000 lbs of gasoline your car is going to burn up to go 120,000 miles?

Realizing that lithium isn't the fuel, comparing green electricity vs gasoline:
- Yup...but another 1000 lbs of solar panels (probably a big over-estimate?) on my roof will last 25+ years and provide my EV with all the "fuel" it needs, plus power my house. Honestly...if the average driver only goes about 40 miles per day, that requires about 10 kWh of electricity each day, so about 2 or 3 kW of solar panels. So, about 8 of Tesla's 400 Watt panels? A few hundred pounds?
- No, seriously Mr. EV_Hater...how are you going to seriously compare a 1000 lb battery plus 1000 lbs of solar panels to the 10,000+ gallons, or 60,000+ pounds of gasoline you're going to burn in the next 25 years?

Great points; easily digestible sound bites. Will add to the toolbox.

 

[AndrewZ]

I don’t get your logic.

If Tesla sells 1.8M vehicles this year, that comes directly from competition whether Tesla does it by advertising or price cuts or price raises. The bottom line is how many Teslas are being delivered. Not the price they’re selling for.

Tesla did not start a price war for marketshare. They would have VERY happily kept their prices up or raised them if they could have still sold 1.8M vehicles this year.

What i believe happened is that EV demand fell (or did not grow as fast as production) mostly because of interest rate increases. Only Tesla had the positive gross margins large enough to allow them to lower prices enough to offset that drop in demand.

Tesla didn’t start a price war. They started a production war with GigaBerlin and Austin. That’s when the (current) war began. The prices thereafter are purely set by consumer demand. Tesla has told us they set prices such that order flow roughly matches the near term production. That’s it. There’s no strategy meeting where they say ”Hey let’s cut prices to hurt everyone or to take even more marketshare“.

Most companies are demand constrained. So they can start a price war to generate enough demand to warrant increasing production. The difference is Tesla KNEW that they had enough cost advantage that they could decide to increase production as rapidly as possible from the beginning of this decade and trust that their cost advantage would allow pricing to sell out that production.

Lest us keep in mind that much of the "price war" was Tesla cutting its prices back down to what they were before the COVID car market craziness, though I think the Performance/Plaid trims have actually never been cheaper -- and all are cheaper in real terms when adjusted for broader inflation.


I would also posit that the legacy carmakers aren't in the business of adjusting MSRP in the same way. MSRP for them is what it is, it would be on the dealer network to offer incentives etc just like it was generally within their purview to charge additional market adjustments when the car market was crazy. Tesla with direct sales rode that wave and benefitted on the way up and also rides that wave on the way down.


Bottom line though, high prices were the aberration and cannot return.

 

[Thekiwi]

Tesla : Q3 will be lower production than Q2 due to upgrades
Wall St : yah, yah, whatever
Wall St now : OMG! Production below Q2, why didn't anyone tell us?

One has to consider that it has been quite a bumpy couple of months for Tesla since the last earnings call, with the only major positive headline seemingly being AJs note.

The negative headlines:

- Zach Kirkhorn unexpectedly resigned not long after Q2 earnings call
- First quarter in recent memory that production will be down Q-o-Q that wasn't related to forced shutdowns (covid etc). Explained (retooling/new product ramp), but still unusual and not as many expected this year would play out. Elon’s 2 million 2023 stretch goal is no longer likely achievable.
- Tesla 2023 EPS expectations lowered
- Berlin installed capacity capped lower at 375k instead of 500k.
- EU looking to punish EVs imported from China.
- Elon’s bad press from Ukraine / starlink / Isaccson screwup.
- EVs being increasingly used as a political football in USA.
- interest rate expectations on Wall Street continue to worsen: “higher for longer”
- recent broad market sell off

Given the above, share price performance since Q2 earnings is not that shabby.

 

[Words of HABIT]

...I simply believe WS won't allow us to go up right now, not in any meaningful or lasting way at least. They are likely going to walk us down again as low as they can before all of these future revenue sources start posting meaningful revenues a year or two from now.

It's inevitable that TSLA will go up, the financial math will dictate it has to in time, but for right NOW I don't think much of anything can.

I think we tend to give far too much credit to Wall Street. Take control of investing back from Wall Street. If one does not use options or leverage and invests with funds they don't need within the next couple of years, Wall Street will have little impact on one's long term financial goals.

If past is any forecast of the future, TSLA will go up when we least expect it. Tesla keeps hitting it out of the park, and I expect that to continue.

 

[Words of HABIT]

I agree, but "should" and "will" are two different things. We haven't seen much of a rise from everyone adopting NACS, and I honestly don't think we'll see a permanent bump from anyone licensing FSD.

At least, not until the revenues are being posted regularly every quarter, but that takes time, which would allow WS to reposition and prepare while still holding TSLA down to the best of their ability.

Optimus impressing the AI world isn't bumping us up, CT's driving around and rolling out of Austin hasn't bumped us up, China producing Highlands en masse hasn't bumped us up. I simply believe WS won't allow us to go up right now, not in any meaningful or lasting way at least. They are likely going to walk us down again as low as they can before all of these future revenue sources start posting meaningful revenues a year or two from now.

It's inevitable that TSLA will go up, the financial math will dictate it has to in time, but for right NOW I don't think much of anything can.

TSLA was trading at $184.47 on March 25th, 2023 when Ford announced they were adopting Tesla's NACS, a 31% increase to today's close.

Tesla FSD licensing to other OEM, simply never see this happening, so agree no bump in TSLA for this.

Agree with material revenues being posted in Tesla's financial reports for new products prior to seeing respective increases in TSLA, such as Cybertruck, Highland Model 3, Semi, Optimus, FSD, Energy...not simply announcing products or releasing their final reveal specs. Why is this so surprising for many posters here?

 

[wipster]

I read this announcement from MB and laughed my keister off uncontrollably!!

Mercedes-Benz announces Level 3 autonomous Drive Pilot launching in California and Nevada this year

Mercedes-Benz has announced Drive Pilot, a Level 3 autonomous driving system, will launch in the US before the end of 2023. While some may say this move places Mercedes-Benz ahead of its competitors, including Tesla, […]

driveteslacanada.ca

Level 3 alright, but only when following another car on specific freeways going 40 MPH... hilarious.

 

[Words of HABIT]

Jacob Hilton does a fresh take on latest Tesla news and the dilemma of legacy auto manufacturers.

 

[Usain]

Perhaps you could provide a list of all the U.S. companies making lithium ion batteries for automotive applications? I'll start you off:

1. Tesla:
   1. Texas Model Y AWD (until recently)
   2. Cybertruck (imminent)
   3. Semi (2024 at Giga Nevada)
2. ???

TIA.

Right. Tesla's 4680 is starting to become very important and soon to be very profitable. It's pathetic that Tesla is the only US auto company to step up to the plate.

We have the know-how. Contrary to popular belief, Tesla is not the only company who can hire great talent. GM and Ford could have started their own battery programs the day after battery day. They would be a little behind, but it would pay off in the end. With their current plans, there may be no path to EV profitability and they are starting to realize it.

The lithium battery is the most important manufactured product of this century. And Tesla is the only US company taking that seriously.

 

[hobbes]

Doesn’t look so good for FSD in Europe for 2024 :/

https://twitter.com/x/status/1706236624558768129

 

[Thekiwi]

Perhaps you could provide a list of all the U.S. companies making lithium ion batteries for automotive applications? I'll start you off:

1. Tesla:
   1. Texas Model Y AWD (until recently)
   2. Cybertruck (imminent)
   3. Semi (2024 at Giga Nevada)
2. ???

TIA.

Doesn’t Ultium make batteries in the USA? (half owned by GM)

 

[Bouboule]

Still baffled anyone finds this likely short term.... From Teslas side it'd require a (relatively) finished product, which they don't have (they're in the midst of Yet Another Nearly Complete Rewrite per Elon himself)- and it'd require Tesla mandating a bunch of HW they're still not finalized on in their own cars (S/X, Highland, and Y all appear to have different variants of the HW>3 configs) as well as mandating certain minimum requirements for all the vehicle control capabilities, redundancies, ties into other HW in the vehicle, etc... and from the OEM side it'd require abandoning existing contracts with folks like Mobileeye, and entirely redesigning vehicles and manufacturing to accommodate the Tesla mandated HW and controls and redundancies AND sourcing all the parts to do all that AND refitting factories to handle the changes. All while they're also currently on strike for the big 3.

I'm not saying this isn't a thing that'd happen some day... but "short term" is exactly 0.00% chance.

Remember it took 7 years from Tesla saying they're open to other OEMs accessing superchargers till the first deal was inked... and superchargers were a "complete" product requiring virtually no comparable "change" from the OEMs other than one part on the car.

I am one of those who find it very likely to happen in the short term (by short term, I mean within a year).

The main reason is that it's all about risk management. If you want to remain competitive in a fast-changing environment, you have to take some risks; waiting for products to hit the market is not a viable option. You need to co-develop with your suppliers.

The typical approach involves companies engaging in the development of unproven technologies alongside their Tier 1 suppliers. These Tier 1 suppliers, in turn, collaborate with Tier 2 suppliers, and so forth.

To introduce a new product that is already fairly mature typically takes 3 cycles of approximately 1 year (Sample A, B, and C), each at different levels of maturity and tooling. This is true for OEMs but also true for Tier 1, 2, 3, and so forth. If you wait for your supplier to finish all their validations and then start yours, you are looking at 6-7 years minimum. The way to accelerate this is to take some risk with trusted suppliers. Once they have built their Sample A, you start development with their Sample A while they are moving to Sample B. This way, you are just 1 cycle behind but have more risk if something fails during the process.

Like many have said, only a handful of companies will provide hardware-software for autonomous cars because of the barrier to entry, so there are not that many trusted suppliers to choose from. The NACS adoption gave huge credibility to Tesla, positioning it as a trusted supplier for other OEMs.

Regardless of where Full Self-Driving (FSD) technology stands today, it's just a question of what OEMs think FSD will be in 3-5 years. If they think it's 10 years away, then yes, they have time. But in my view, the current progress in FSD is demonstrating strong indications of becoming genuinely valuable within the next five years, which is putting pressure on OEMs to consider partnerships within a year.


PS: As I mentioned earlier, smaller OEMs with less to lose may opt for a partnership with Tesla more quickly. Being able to market autonomous cars a year or two ahead of competitors could be a game-changer for them.

Below is the typical ISo26262 development cycle (this is repeated 3 times for each phase).

 

[Artful Dodger]

Walter Isaacson: The UAW strike is about legacy automakers figuring out the transition to EVs | CNBC Television (13 hrs ago)

 

[Artful Dodger]

Doesn’t Ultium make batteries in the USA? (half owned by GM)

Not really since it's a S. Korean company:

• LG is also GM's supplier/partner for their upcoming Ultium-based EVs (Aug 31, 2021), and
• GM Ultium bty pack is worse than nothing (May 18, 2023), and
• GM Shuts Down CAMI EV Plant Amid Ultium Battery Shortage (Jul 18, 2023)

So GM isn't the actual company (not) making their batteries.

No surprise: "the fewer EVs they make, the less money they loose"... doncha know? GM is structurally unprofitable.

Cheers!

 

[MC3OZ]

The 'old news' Reuters casting article has now been updated to actual news (perhaps they were trying to bury it)..

This could explain why the Model 3 Highland isn't using front/rear castings - could it be getting a single casting?

Tesla working on 'gigacasting' tech to mould underbody in one piece, Shanghai Securities News reports

Tesla is working on an upgrade of its "gigacasting" technology to die cast almost all vehicle underbody parts in one piece, the Shanghai Securities News reported on Wednesday citing unnamed sources close to the automaker.

www.reuters.com

'Tesla (TSLA.O) is working on an upgrade of its "gigacasting" technology to die cast almost all vehicle underbody parts in one piece, the Shanghai Securities News reported on Wednesday citing unnamed sources close to the automaker.

The state-owned Chinese newspaper, which based its report after a recent visit to Tesla's Shanghai factory, did not say when and where the upgrade will happen.'

Reuters have walked back some of their comments, as explained in this video from Rob:-

It is safe to say that whatever is really happening with Gigacasting, Reuters can't read Chinese translations.

The rumour about the Loch Ness Monster getting a speeding ticket driving down the M1 in the Apple Car is also false.

 

[SPadival]

My thoughts too - that CT is beginning to look like a finished product

That’s what an Indian would say.. because of the plastic seat covers on a new car that’ll never be removed for the life of the car

 

[hobbes]

Very interesting info on Gigapress use by Tesla, don´t know the source, but recommendation by The Limiting Factor helps
- No Giga Casting in Highland 3, not enough presses available; Y takes precedence due to higher volume
- Next step single piece casting but requires 16,000-20,000 ton presses will be available summer 2024 at the earliest
- My guess: when Y moves to single piece castings, 3 gets the two-piece presses

https://twitter.com/x/status/1707034450440138758

 

[bruce4000]

Tesla's rivals scrap for thin slices of US EV sales

Ford Motor's decision to hit the brakes on a planned $3.5 billion battery plant in Michigan highlights a challenge for Tesla's growing crowd of rivals in the U.S. market.

www.reuters.com

View attachment 977534

So much for the competition is coming….. isn’t GM’s EV sales mostly the Bolt which it had said earlier in the year they were discontinuing it?