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

[MC3OZ]

Honestly we can't say this for sure, the 4680s V2 in a Model Y would be indistinguishable from a 2170, and we know Tesla retooled the lines a while ago

So there is a chance that now there ones line for 2170s, and another for 4680s and both produces Model Y LR

But Tesla is lacking 2170s right now, this is why the Model 3 LR on US is now using LG cells imported from Asia

You could be right, but 4680s in a Model Y would probably have front and rear castings and a structural pack.

I don't know there were importing 2170s, but I wonder if the IRA has any impact on that kind of decision.

 

[dhanson865]

Discussion of a gas station in Indiana with solar panels, a smaller exchange went like this

So you can recharge your EV, and, still buy your chips and soda

[–]largeb789 2 points 4 hours ago
That 87kW array won't even keep up with one 350kW fast charging car.

[–]dhanson865 1 point 6 minutes ago*

350kW fast charging car.

of which there is only 1 brand/model produced and that only 16,088 have been produced of that model (Hummer EV).

If you drop down to 300kW you add another 1 brand/model and 8,761 electric cars (Lucid Air)

Combined the two brands/models have 24,849 vehicles on the road.

like .000000001% of all EVs on the planet. But sure go for the straw man argument.

In 20 days there might be a 3rd vehicle to add to that list (Cybertruck). I'll be glad to update the numbers after Christmas when we see how many there are.

---------------------

anyone want to double check my math, did I miss a car that is more common than the hummer EV that can take 350kW? Given that the Cybertruck will be able to but other than it?

 

[ZeApelido]

https://twitter.com/x/status/1723106602650063262

"https://twitter.com/elonmusk First I’ve heard of this. Seems odd."

Someone’s getting fired.

 

[2daMoon]

Someone’s getting fired.

Well, YOU would know, right?

 

[2daMoon]

Then, there's this...

 

[mongo]

Do IRA credits for cell manufacture kick in:-

1. When the cell is manufactured?
2. When a vehicle containing the cell is sold?

Credit being paid when a vehicle is sold are much easer to track and validate from an audit trail point of view.

So Austin might be producing more 4680s than Cybertruck can use in the early stages or the ramp, these might be being stockpiled at Austin and might go into vehicles in 2024 when they can gain the IRA cell subsidy?

Most or all of the Gen1 4680s going into the Austin produced Model Y came form Kato Road which has since stopped making those cells.

3. When the cells ($35) or module ($10) are sold

For Panasonic cells from GF1, that's likely at transfer to Tesla.
For Tesla cells and modules, that's likely when the car is sold.

(A) produced by the taxpayer, and
(B) during the taxable year, sold by such taxpayer

(1) RELATED PERSONS.—Persons shall be treated as related to each other if such persons would be treated as a single employer under the regulations prescribed under section 52(b).

(4) SALE OF INTEGRATED COMPONENTS.—For purposes of this section, a person shall be treated as having sold an eligible component to an unrelated person if such component is integrated, incorporated, or assembled into another eligible component which is sold to an unrelated person.’’.

However, it's whenever Treasury and company agree it is (if Tesla Energy 'sells' cells to Tesla Automotive) ...

3) UNRELATED PERSON.—
(A) IN GENERAL.—For purposes of this subsection, a taxpayer shall be treated as selling components to an unrelated person if such component is sold to such person by a person related to the taxpayer.
(B) ELECTION.—
(i) IN GENERAL.—At the election of the taxpayer (in such form and manner as the Secretary may prescribe), a sale of components by such taxpayer to a related person shall be deemed to have been made to an unrelated person.
(ii) REQUIREMENT.—As a condition of, and prior to, any election described in clause (i), the Secretary may require such information or registration as the Secretary deems necessary for purposes of preventing duplication, fraud, or any improper or excessive amount determined under paragraph (1)

 

[Drumheller]

The referral incentive added 6 months of free supercharging but removed the $250 discount. I've been watching prices on the model y as a friend is likely to get one before the end of the year and they've been becoming more expensive in Q4.

 

[EQC_]

Both LK and IDRA have tended to produce the same products, depending largely on the source of orders. Of course opinions may differ, but we do know that Chinese manufacturers have been more rapid than have Japanese, European and American OEM's. If Tesla is ordering those we'll find out soon enough. It does seem quite likely that these will be even more difficult to commission that have been the 6000 and then 9000 ones.

1. Just imagine how much expense can be excised from larger vehicles with this machine!
2. Then imagine just how demanding will be the physical facility required to how this thing!
3. Then realize that it's highly probable that this one could not be retrofitted for an existing factory.
4. Then think how many OEM's are cap[able enough to manage the technological challenges of filling this monster, cycling it and removing the finished product.
5. Finally, which OEM's can deal with the materials required to enable the process.

If the answers are all the same company (ies) then we know who the customer(s) are.
TSLA is one. How about SAIC, GWM, BYD ?
Historically BMW has accomplished some arcane skills. BMW Technik has delved into unusual solutions.
I admit to possible bias since I owned a Z1 for several years, one of those that did yield some later widely deployed technologies, notably the rear suspension. Still, they've not been adept at manufacturing cost efficiency. Nearly all other OEM's seem incapable to manage the technological complexity of state-of-the-art Gigacasting.

One other note/clue is that, at least based on my estimation, it doesn't make financial sense to invest in a gigacast machine unless it will be making 100,000+ castings per year...and ideally that would be identical castings instead of swapping in different molds regularly.

I would also imagine that for a bigger and more expensive casting machine, the production target to make the machine worth the investment might be even higher.

For an auto manufacturer, this *could* mean 100,000+ annually of one model...or perhaps of one platform, where several models can use the same casting.

In the EV world, there only a few manufacturers targeting those kinds of numbers...

 

[mongo]

It must be when the vehicle is sold, since IRA manufacturing credits are only applicable to cars sold in the U.S.A. (ie: exported cars from Fremont to Canada wouldn't be eligible, even if the cells were made in Nevada).

Incorrect, clean vehicle credits are only for sales to US taxpayers. However, manufacturing credits are for US (or possession) manufacturing to anywhere.

(1) ALLOWANCE OF CREDIT.—For purposes of section 38, the advanced manufacturing production credit for any taxable year is an amount equal to the sum of the credit amounts determined under subsection (b) with respect to each eligible component which is—
(A) produced by the taxpayer, and
(B) during the taxable year, sold by such taxpayer to an unrelated person.

2) ONLY PRODUCTION IN THE UNITED STATES TAKEN INTO ACCOUNT.—Sales shall be taken into account under this section only with respect to eligible components the production of which is within—
(A) the United States (within the meaning of section 638(1)), or
(B) a possession of the United States (within the meaning of section 638(2))

 

[mad474]

On the occasion of the monthly drive-by, I have just checked our fixed and current assets, including the functionality of the new solar-assisted V4 loader: Everything looks good and works perfectly. The area is humming with activity despite the weekend. The snack machines are readily contributing and the lawn is also comfortable:

Based on the results of my extensive inspection, restraint in the share price is completely inappropriate!

A relaxing weekend to all!

 

[GOVA]

I've had a Tesla replacement vehicle twice in past 6 months. Both times it had FSD, which normally I don't have.
Around 3 months ago, I used it for 2-3 days and it was okayish at most.
Just this week, 3 months after that first one, I had it for 3 days as well. The deference was staggering. This time it was very impressive both on the highways and city streets. Frankly, I'd say we are closing on FSD rather quickly. Even more impressive was the fact that this time it worked great on M3 from 2019 with 65K miles, which I know, should not make a difference as it is supposed to work on any HW.

With the amount of "new compute" Tesla is about to implement, FSD and Optimus will change human civilization.

 

[Artful Dodger]

Ron Baron expects SpaceX to conduct an IPO for StarLink within 4 yrs (by 2027). He says SpaceX is currently valued at $150B privately, and expects it to be worth $250B to $300B by the Starlink IPO, and $500B by 2030. At (2:25) into this clip, Ron says Morgan Stanley and Goldman Sachs estimate the TAM for StarLink services at $1.2T annually:

Here's the fun part:

1. Elon owns roughly half of SpaceX shares. The StarLink IPO could easily raise $500B (if valued at 20x Fwd PE), giving Elon access to roughly $250B in cash (or equity to support borrowing power)
2. Elon has to execute his 2018 Tesla CEO stock options no later than April 2028 (Plan approved by the Tesla BoD and passed by a vote of shareholders at the 2018 AGM)
3. Due to their ballooning value, these stock options will cost ~$200B+ to execute (paging @mongo for the Executive Summary)
4. Tesla short-sellers extracted > 10x the value in TSLA Market Cap last time Elon sold shares to finance executing his 2012 CEO Comp. package
5. the threat is that shortzes will again gang-tackle TSLA when Elon inevitably executes his 2018 CEO Comp package (which must be done within 4.5 yrs)
6. What if Elon has cash in hand instead from a 2027 Starlink IPO and doesn't need to sell any TSLA shares to execute his stock options?
7. Profit. (jus' sayin')

Cheers to the Longs!

P.S. Hasbro HSBC be daft. Elon can sell TSLA at a leisurely pace post 2028, and pay only capital gains for shares he's held more than 1 calendar year. That'll be enough to fund a city on Mars.

 

[mongo]

Due to their ballooning value, these stock options will cost ~$200B+ to execute (paging @mongo for the Executive Summary)

Roughly 304 million shares at a basis of $23.33, so $7.1B to execute the options.
Taxes on the remainder is the pain. The longer he lives outside California, the less state tax he pays 12.3%*(2018 until he moved/ 2018 to execution) if executed in 2028, around 12.3%*20%= 2.46%
Federal tax 37%
Net investment tax: 3.8%
Execution: 3% (SP of 700)
Total: 47% (rounded)
So roughly 47% or 143 million shares (or equivilent cash value) need to be sold immediately. If SP=$700, that's $100 billion.

 

[evermore]

Roughly 304 million shares at a basis of $23.33, so $7.1B to execute the options.
Taxes on the remainder is the pain. The longer he lives outside California, the less state tax he pays 12.3%*(2018 until he moved/ 2018 to execution) if executed in 2028, around 12.3%*20%= 2.46%
Federal tax 37%
Net investment tax: 3.8%
Execution: 3% (SP of 700)
Total: 47% (rounded)
So roughly 47% or 143 million shares (or equivilent cash value) need to be sold immediately. If SP=$700, that's $100 billion.

The CA FTB would likely assert that all of the stock options granted for work done while Musk was a CA resident are subject to the full tax rate. In other words, the amount taxable doesn't change the longer he lives outside of CA, it is fixed, and based on when the options were awarded.

From FTB Pub. 1100:

E. Stock Options​

Nonresident​

California taxes the wage income received by a nonresident from employee stock options on a source basis, whether you were always a nonresident or were formerly a California resident.

Example 14​

On February 1, 2007, while a California resident, you were granted nonstatutory stock options. You performed all of your services in California from February 1, 2007, to May 1, 2010, the date you left the company and permanently moved to Texas. On June 1, 2010, you exercised your nonstatutory stock options.

Determination​

The income resulting from the exercise of your nonstatutory stock options is taxable by California because the income is compensation for services having a source in California, the state where you performed all of your services.

 

[Artful Dodger]

So roughly 47% or 143 million shares (or equivilent cash value) need to be sold immediately. If SP=$700, that's $100 billion.

Wow, or at today's SP that's just over $30B. Cartman, git those underpants!

Cheers!

 

[Artful Dodger]

Happy Veterans' Day to my American friends who served. Thank-you.

For those in Commonwealth countries, "Lest We Forget".

To absent companions, you will be remembered.

 

[hobbes]

Gary´s take on the downgrade yesterday after reading the whole note:
Looks like it is constructed with an agenda:

https://twitter.com/x/status/1722926087846400330

 

[hobbes]

Wasn´t aware of this, 25k car anyone?

https://twitter.com/x/status/1723084416849731888

 

[hobbes]

And it seems like preparation for Giga Mexico has begun (jump to 1:50 if you´re in a hurry):

https://twitter.com/x/status/1723099114223645114

EDIT: The analogous moment in Giga Berlin history, not quite four years ago:

 

[mongo]

The CA FTB would likely assert that all of the stock options granted for work done while Musk was a CA resident are subject to the full tax rate. In other words, the amount taxable doesn't change the longer he lives outside of CA, it is fixed, and based on when the options were awarded.

From FTB Pub. 1100:

I'm not a CA CPA, nor CPA at all, so may be getting it wrong, but I think senario C applies, taken from
https://www.ftb.ca.gov/forms/misc/1004.html#D-Incentive-Stock-Options

Nonresident of California on Exercise Date If you exercise your nonstatutory stock options while a nonresident, the character of the stock option income recognized is compensation for services rendered. California will tax the wage income you receive to the extent you performed services in this state, whether you were always a nonresident or were formerly a California resident. (Appeal of Charles W. and Mary D. Perelle, 1958-SBE-057, December 17, 1958)
...
Services performed within and outside of California If you performed services for the corporation both within and outside California, you must allocate to California that portion of total compensation reasonably attributed to services performed in this state. (California Code of Regulations, Title 18, Section 17951-5(b))

One reasonable method is an allocation based on the time worked. The period of time you performed services includes the total amount of time from the grant date to the exercise date (or the date your employment ended, if earlier).

The allocation ratio is:
California workdays from grant date to exercise date ÷ Total workdays from grant date to exercise date

Income taxable by California = Total stock option income × allocation ratio

Example 3 On July 1, 2009, while a resident of Texas, your company grants you nonstatutory stock options. On July 1, 2010, your company permanently transfers you to California. On July 1, 2013, you leave the company and permanently move to Florida. From July 1, 2009 through July 1, 2013, you worked for the company a total of 700 days in California and 300 days in other states. On August 1, 2013, you exercise your options.

Determination: The difference between the fair market value of your shares on August 1, 2013, and the option price is stock option income characterized as compensation for services. The total workdays from grant date to exercise date equal 1000 workdays (700 California workdays + 300 other state workdays). Your allocation ratio is .70 (700 California workdays ÷ 1000 total workdays). Therefore, California will tax 70 percent of your total stock option income.