Buckminster
Well-Known Member
I sure hope Elon reads this perceptive Troy thread. Maybe it's not too late for Elon to prioritise battery procurement and manufacture.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Musskiah
DisGruntled
The 10th Gujarat Global Summit...hmmm...I wonder what this "Electric Vehicle Manufacturing" on January 12th is all about
Hang in there. People might be right. Tesla has made many improvements to the charging curves of numerous models. I'd rather they be conservative with the 4680 rollout than have bigger problems.
insaneoctane
Well-Known Member
Plus if the 4680 significantly out performs the 2170 charging, then they run the risk of Osborning their products. For now I think Tesla doesn't want the consumer to worry about which cell is in their Tesla. No reason not to keep performance close for now.
I haven't been following it closely but a quick google search shows Panasonic's new 2170 plant in De Soto, Kansas is due to come online in 2024 and Tesla is listed as their main customer. So if they hit their deadline there will be some additional capacity next year regardless of the much needed 4680 ramp.
Panasonic breaks ground on $4 billion EV battery plant in Kansas
Doesn't this just show the cheapest the vehicles could possibly be. Using ICE market splits shows that while there is a high volume of low priced vehicles, there will still be a large number of higher priced vehicles that offer more features that will be sold and that brings the average up.
An extremely crude example of what the Tesla ASP could look like once Gen-3 vehicles are fully ramped
Units/Year | ASP ($) | |
| S/X | 100,000 | 80,000 |
| 3/Y | 3,000,000 | 40,000 |
| CyberTruck | 300,000 | 70,000 |
| Semi | 100,000 | 180,000 |
| Gen-3 | 8,000,000 | 25,000 |
| Total | 11,500,000 | 31,913 |
Even if a mythical Gen-4 vehicle was added in at $10k ASP the fleet ASP would still be above $20k - And I don't think this is realistic as no-one is selling ICE vehicles this cheaply in the US. There likely ends up being other factors rather than the cost decline curve that start to impact this pricing (e.g. logistics costs being too large a portion of manufacturing cost, customers preferring a better specced used vehicle for $10k than a bare bones new one, manufacturers not getting the return they wat or cannibalising their higher priced vehicles, etc)
Units/Year | ASP ($) | |
| S/X | 100,000 | 80,000 |
| 3/Y | 3,000,000 | 40,000 |
| CyberTruck | 300,000 | 70,000 |
| Semi | 100,000 | 180,000 |
| Gen-3 | 8,000,000 | 25,000 |
| Gen-4 | 9,000,000 | 10,000 |
| Total | 20,500,000 | 22,293 |
An additional point would be whether Tesla would believe their money is best spent building millions of $10k vehicles or whether those funds will be spent building optimii / stationary storage / FSD fleet. That question is a long way down the road but it doesn't seem highly likely to me that Tesla will ever get to high volume $10k vehicles given Elon is so good at finding new high return investments.
Troy's analysis is too static and references the incremental price reduction needed in a rising rate environment. If the Fed drops rates according to current market expectations we could well see higher volumes at higher ASPs as auto loans become cheaper. The economics are true (need to lower price for higher volumes, all else being equal) but Troy's estimate of the margin impact of a 5% difference in volumes is just a finger in the air. They also don't factor in continued manufacturing efficiency or the CyberTruck ramp.
Also, we have already been advised of the answer - Elon has said on multiple earnings calls that he will go to just above cashflow positive to increase volumes if needs be.
That’s why the school with the “Other” reputation. And it wasn’t just young idiots. Armies and Navies since ye olden times have discovered the ability of NCOs (Chief Petty Officers on down) in melding the feckless young into something a lot more effective.
Besides, you’re talking the USN, here. We have a tradition, dammit, of when something’s lit afire, damaged, spraying flammable substances, leaking gouts of high pressure steam, blasts of seawater, and all that jazz, of grabbing every available implement of corrective action and running towards the fun.
And if it’s the enlisted who act like that, you haven’t seen the officer corps types in that kind of situation. The people whose actual job it is to go fight damage have to shoulder aside (and sometimes fail to do so) the gung-ho types from Annapolis who just React and go for it.
That’s all Vietnam-era experiences, so things may have changed in 50 years. Don’t think so, though.
Elon is Elon, simple as that, he has his "demon mode" and his supreme altruistic side, you never know which one is going to turn up to the party
I said this a couple of months back, everyone here has to read Isaacsson, it really helped me understand Musk, why he behaves the way he does and to a large extent it pretty much defused my concerns, and although I'm still aghast at a lot of his behaviour, I find myself filled with more admiration for his achievements than I was in the past
We'd have no Tesla without Elon's characters quirks, no orbital rockets landing on platforms at sea, no affordable satellite internet, and a lot of folks here would not be anywhere near as wealthy as they are today
As regards the IRA and Model 3. Tesla have know for well over a year now that these mineral sourcing requirements would come into play. I personally find it inconceivable that they didn't prepare for this moment - I don't think hopium that the rules would be loosened would be part of that plan
Minor point, my understanding is that the Model 3 gets zero credit in 2024 due to Chinese components (excluded entity clause), not due to the 10% higher mineral sourcing and component requirements.
Further, Chinese sourced packs only qualified in Q2-Q4 of 2023 (Q1 was a free for all based on old eligibility rules) due to the IRS/ Treasury guidance that allowed doing the percent calculation over a full model line or factory's output instead of per vehicle.
Federal Register :: Request Access
On the last day of 2023 I thought perhaps it might be wise to stop and reflect on a couple sayings.
"You should take the approach that you're wrong. Your goal is to be less wrong."
"Honor those who seek the truth....beware of those that have found it"
My favorite:
"When the student is ready, a teacher will appear"
I plan on going forward with an open inquisitive mind...when I do that I have found many wonderful teachers.
Including many of you fine folks here.... Thank you
"You should take the approach that you're wrong. Your goal is to be less wrong."
"Honor those who seek the truth....beware of those that have found it"
My favorite:
"When the student is ready, a teacher will appear"
I plan on going forward with an open inquisitive mind...when I do that I have found many wonderful teachers.
Including many of you fine folks here.... Thank you
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After tweeting ~500k production for Q4..( not sure what is in patreon)
I think Troy is in full Debbie Downer mode past few days…. ( just my observation….)
+ he even conducted a poll for 2024 just 2 choices like 2M and 2.1M…
So rather than wait on just 4Q and 2023 achievements… he is already trying to steer the conversation to a bad 2024
Cheers!!
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Buckminster
Well-Known Member
Could buying American made 2170s be the problem? Maybe the USA Highland edition squeezes in 4860s (with or without gigacastings)? Another reason why USA made Highland has been so much later than China.
My Troy post was a joke btw. I will continue to add the "..." to make it less obvious next time...
2daMoon
Mostly Harmless
Because the mission is less about high returns and more about high production it is easy to discount the mission when people analyze Tesla using the standard yardstick of high returns we've all become accustomed to.
When plotting Tesla's future, if given the choice of high returns or high production, I think they will always lean toward high production and still generate adequate returns to grow and find new solutions.
This is what differentiates them from the other manufacturers, and, it is what leads Tesla to be so much more innovative in the realm of reducing costs and developing processes to improve production line speed for a variety of products in unique ways.
In the end they are still quite profitable, without having focused on profits. This is what allows them the flexibility to take on such a diverse range of products which are related in remarkable ways. Such as Optimus sharing software with FSD, and soon Optimus will be working in the factories building things.
Battery advancements in both chemistry and manufacturing which is poised to come on line in the US and Germany and the applications can be split between auto, energy, and Optimus. Also, raw materials and cathode processing should be included in this assessment.
Then, there is AI development that may significantly increase the ability for Tesla to develop additional new technologies and processes even quicker than they have been doing it. Imagine that.
Tesla is still an amazing and significantly misunderstood company by those who have made their career the business of analyzing investments. The way Tesla knits everything together is completely unexpected and it has taken decades for Wall Street to begin to grasp the scope of these disruptive innovations and how they are complementary to each other.
Tesla figures out how to do it a) better (quality), b) cheaper, and c) faster, breaking the rule that used to allow only the choice of any two of those three qualities.
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Thanks for correcting my presumption, however the point remains, has been coming along time, Tesla been sitting on their hands the last 12 months doing nothing about it? Not their, or Elon's usual approach IMO
I do remember this , but does it make sense for Kato to be just R&D with no production.. or was it more like Tesla keeping things close to the chest?
For anyone with Spotify Premium, the audiobook of Isaacson’s Elon Musk biography is available for free with the service.
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