It seems like just yesterday that Munro was amazed at the quailty of the Nvidia based boards he found in the M3. I would love to see video of him looking at the new TPU.
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jhm
Well-Known Member
Yes, ultimately it is the whole supply chain that must be built out. There are bottlenecks all along the way. It think Musk is recognizing that being intimately involved in just about every step is critical to sustaining a high growth rate. This is all part of the experience or learning curve. At each higher scale everything becomes more difficult and finding efficiency is key. The way we typically talk about the experience curve is that as cumulative production doubles the cost per unit falls 10% to 20%. Thus, we often think of falling prices as a consequence of scale. But efficiency is really the driver of cost savings. So one could also think of the doubling of production as a consequence of efficiency gains all along the supply curve. So what Elon's team must focus on is how to get those efficiency gains as quickly as possible. This in turn will be key to doubling production at a quick clip, and it will drive down cost too. They are doing this too. Every time they iterate and figure out how to speed production, they are learning new efficiency, cutting costs, and driving up production. You can't just throw money at it, you actually need talent that can simplify and shorten the path.
Damn you beat me, I'm up 330%. My only regret is that I didn't have much when I started my original NVDA position. I could be retired now. Oh well.
sundaymorning
Active Member
Let me summarize reddit bears with this photo posted above. They’re rolling in deep $h1t right now, hope he bought on margins and get wipped clean. Let this be a lesson for shorts/bears.
I've been long TSLA since its IPO and have been adding since (own a Model X too). I've also been lurking on this forum since its inception but never feel like I have anything more to contribute so I've never posted (but thank you to all the real contributors) until now.
I really liked the ER and conference call but one thing I just realized is that producing 50-55,000 Model 3s for Q3 it is still less than 5K production per week for the quarter. Best case scenario is 55K produced in 13 weeks is only 4,230 per week. I'm surprised this hasn't been posted anywhere yet that I have found, so I finally decided to post it to get everyones thoughts.
If they are aiming to hit 6K per week production by end of Aug then shouldn't the Q3 estimate be more? Even with 2 weeks of factory shutdown for upgrades that only averages 5K per week (55K produced / 11 weeks = 5K). My thoughts are they are really trying to sandbag the numbers (ie. "A win should feel like a win"), or they plan on shutting down production for an extended period of time during this quarter for factory upgrades, etc.
Am I missing something? What are your thoughts?
I really liked the ER and conference call but one thing I just realized is that producing 50-55,000 Model 3s for Q3 it is still less than 5K production per week for the quarter. Best case scenario is 55K produced in 13 weeks is only 4,230 per week. I'm surprised this hasn't been posted anywhere yet that I have found, so I finally decided to post it to get everyones thoughts.
If they are aiming to hit 6K per week production by end of Aug then shouldn't the Q3 estimate be more? Even with 2 weeks of factory shutdown for upgrades that only averages 5K per week (55K produced / 11 weeks = 5K). My thoughts are they are really trying to sandbag the numbers (ie. "A win should feel like a win"), or they plan on shutting down production for an extended period of time during this quarter for factory upgrades, etc.
Am I missing something? What are your thoughts?
I’m hoping that a new crop of analysts will now start covering TSLA. Some will wait until profits are proven, but many can now do the math with the info provided today. With new analysts will come new investors.
I like to think that too, but when I looked at tesla job offerings, I found a lot of microsoft technology mentioned. Not instilling a lot of confidence honestly.
Ulmo
Active Member
Margin calls also increase their profits if they're on the opposite side of the call.
Welcome to TMC!
IMHO it is a combination of the fact that the ramp to 6000 is not linear, because to change something in the lines to make them faster they first have to slow it down, so 6000 reached doesn´t mean above 5000 on average; and then some sandbagging hopefully.
I mentioned this right after the Q2 letter and got few "disagrees" as seems the usual case when you post something that's not super-positive on this forum
TSLA Market Action: 2018 Investor Roundtable
Yes, they will likely have downtime or otherwise quite a bit of iterating working out issues and these improvements do not happen very fast.
In the letter they said they sustained 5k few times in July, yet overall numbers are much lower, especially considering planned 6k at the end of Aug.
dandurston
Member
Re. 5k per week vs 50 - 55k:
Part of it is that they haven't been averaging under 5K through July. Elon said they did about 5K two of the weeks but probably 3500 - 4k the other weeks as they adjusted the line. So they're probably 5K cars behind averaging 5k/week at this point.
Also they probably have a day or two here and there of additional downtime. So 13 weeks x 5K is 65K cars, but they are perhaps 5K behind the pace and will lose another week spread out through the quarter (holidays, upgrades).
Plus the ramp to 6K is probably 1 or 2 weeks hitting 6K. Not a steady state 6K.
Part of it is that they haven't been averaging under 5K through July. Elon said they did about 5K two of the weeks but probably 3500 - 4k the other weeks as they adjusted the line. So they're probably 5K cars behind averaging 5k/week at this point.
Also they probably have a day or two here and there of additional downtime. So 13 weeks x 5K is 65K cars, but they are perhaps 5K behind the pace and will lose another week spread out through the quarter (holidays, upgrades).
Plus the ramp to 6K is probably 1 or 2 weeks hitting 6K. Not a steady state 6K.
RobStark
Well-Known Member
Those that already paid for FSD will not have to pay for a computer upgrade.
Those that did not get FSD may have to pay more than $3-4k.
No. That is going to be Q3 with.
- profitable
- cash flow positive
- double digit gross margin on M3
That's a win that will feel like a win.
Trying to be humorously pedantic:
FTFY: LTS (Large Testis Strategy)
Testicle literally means “little testis.” The “-icle“ suffix indicates “diminutive.” Kind of insulting. Sort of means “mouse nuts” and should therefore be eschewed by Tesla Bulls.
More accurate designations:
One nut = testis
Two nuts = testes
A more “inclusive” financial concept is the LGS (Large Gonad Strategy), as it applies equally to testes and ovaries.
Appropriate for Market Action thread only insofar as it clarifies the now-popular LTS concept.
It's all fiction. You know, like every investment board that has that one guy that seems to make super dramatic trades with unbelievable back stories? Up by millions, then down, then up even more millions. Gets margin called, wiped out then one month later is back claiming to have bought thousands and thousands of shares, supposedly makes trades with sizes that would show up in the public books (but then don't). You know that guy (yes, this board has him too). Well, wallstreetbets is where all these guys get together.
Ulmo
Active Member
Tesla Results: Pieces Moving into Place for Sustainable Story | Loup Ventures
"The ability of the company to raise debt or equity has been a concern. Tesla reiterated they will not need to raise money to fund operations and separately, outlined that they are closing in on $5B in local Chinese debt financing to build the Shanghai Gigafactory, effectively starting in 2019."
- We are positive on the Tesla story given the company’s well-positioned product roadmap around EV, autonomy, solar, and storage.
- Tesla shares are up ~9% after hours as the company made progress on key pieces to the long-term sustainability of the story.
- The “run out of cash” concern still exists, but likely not for long, as it would be effectively ended if the company turns a profit in Sep-18 or Dec-18.
- Musk was more measured on the call, improving investor confidence.
- Model 3 production and profitability remain unchanged.
- Demand for Model 3 likely to increase as more are available for test drives and are seen in the wild.
- Shanghai factory debt financing points to continued investor support
- One negative from the call: Musk suggested a 2020 total output of 750k-1M vehicles compared to his previous target of 1M.
"The ability of the company to raise debt or equity has been a concern. Tesla reiterated they will not need to raise money to fund operations and separately, outlined that they are closing in on $5B in local Chinese debt financing to build the Shanghai Gigafactory, effectively starting in 2019."
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hockeythug
Active Member
5 years from now: "Is Tesla selling too many cars? More at 11...."
Yep that's a lie. He said $5B was GF1 and GF3 will be not more than 50% of that considering all the improvements they'll put right in. I.e. $2-2.5B.
sundaymorning
Active Member
On average Tesla stops production for 10 days in order to ramp. So there are only 10 production weeks per quarter, not 12. So if they produce 50k then it’s 5,000 a week, but if it’s 55k then it’s 5,500 per week. Given that July is under 5k, September’s burst of 6k will counter July. Hope this helps.
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