TSLA Market Action: 2018 Investor Roundtable

[srius]

What is your point or points exactly?

Replying to original post on what could come after exiting "startup mode" - an effective process-oriented mode, and hope Tesla could successfully make such a switch. I didn't touch the subject though on what make a process-oriented company efficient rather than just being slow and big as most of "process" companies are.

 

[engle]

Totally agree Elon’s life is open book he hides nothing otherwise I bet there are public company CEO with much worse personal habits and characters.

Agreed. Also, Trump has much worse personal habits and character (big time!), and is a very bad example for our children and those CEOs!

 

[Ratanpara]

Wall Street has huge misunderstanding of all the money Tesla spent ( they like to call it burned) on infrastructure, supercharger, stores etc, all this infrastructure has been massively underutilized but now with Model 3 at volume production all this assets will be measured against much higher revenue and profit.

 

[dondy]

A company can be efficient without being in the "scrambling startup" mode. Many successful companies were not even in the "scrambling startup" mode to begin with - for example, Saleforce and Arista Networks. A company can certainly achieve its objectives timely and execute efficiently while keeping the life and work balance. The "scrambling startup" mode doesn't mean it's more effective. Yes, it can achieve an objective in the shortest possible time. But it usually also comes with duplicate efforts, inside fighting, and scrambling to recover problems from lack of planning and time required for integration. Tesla itself provides many examples, such as the recent M3 delivery issues, and M3 battery automation - only finding out the battery module automation problem right before it is supposed to start mass production.

The efficiency of every company all goes down as the size grows, just by the nature of extra communications and reduced average talents. But it's easier for a process-oriented company to compensate the lost efficiency than a human-oriented scrambling style. If you know Tesla engineers, you would know Tesla is not effective, especially for those employees who are not in the path of focused products.

To Elon's credit, he has been able to solve problems effectively created by the scrambling style. No one except him can achieve so much and grow Tesla to this extent running in the "scrambling startup" mode. That's why it's impossible to find Elon's substitute, no one can operate in this mode at this scale.

With his apparent issues - gone are the days of good use of twitter, such as calling for talents to join the autonomous driving team, Elon can now initiate a damage any time, even within days. It's sad to see this for any of his admirers. Just hope the just- announced management change can gradually switch Tesla process-oriented mode. (A process-oriented company can still spear ahead with special projects running in the scrambling startup style.) So Tesla can scale up its operations and retain proven talented employees, such as Dave Morton, Doug Field, and Christian Laettner (Apple Swift, quit after half a year).

interesting if it's another FUD or just ignorance. Nice injection btw. Emphasize mine, for other readers to notice.

Nice "relevant comparison" with IT service company grown on acquisitions and great personal connections in Silicon Valley and one trick pony which uses chinese OEMs for production.
BTW, what Musk does is not scramble, it is as far from scramble as possible.
it's good old iterative design, the problems they have are good old hardware implementation problems.
And, of course all actual well mediated problems with M3 productions are Doug Field problems. And again good old implementation problems, the type which you don't know you have until you try.
The only real "problem" one can assign to Musk is his requirement for his nearest employees to follow the same work standards he has.

 

[dmckinstry]

5 more minutes until the after hours bell. I just bought 100 more.

LOL. The last time I could afford 100 shares at one time was in April of 2013.

 

[phil0909]

Wasn't the CAO hired to oversee the privatisation, having done so at Seagate? Why stay on if Tesla remains public?

Maybe do some accounting?

 

[loky]

Replying to original post on what could come after exiting "startup mode" - an effective process-oriented mode, and hope Tesla could successfully make such a switch. I didn't touch the subject though on what make a process-oriented company ?

To understand Tesla company, you should try harder .What is your point about "big as most of ust your words"?

 

[ggies07]

Incorrect - Jerome is president automotive, Kev gets “people & places”

I'll take People and Places for 400.

 

[Foghat]

Some thoughts...

"building and delivering" this is starting to sound like the "factory gate" discussion. I think the simplest explanation is the real one... they delivered double the cars. Please no-one think Tesla just set itself another goal, whose failure or success can then be discussed over and over.

Jerome... as we should expect from Elon, Elon is still the boss. It remains to be seen how much Jerome will actually interface with the public. Will he start to do interviews? Will he start tweeting Tesla news? Will he introduce Elon at the start of the Model Y reveal, or, actually carry out the Model Y reveal? Will Jerome answer questions at the ER conference call? Will Elon just trample all over him at any opportunity? How all this is managed will guide how the media and investment community really believe that there is a COO. If Jerome is doing some of the talking, there will be a logical conclusion that Elon is getting some rest. Whether that's true or not may never be proven

The joint smoking (or spliff, or whatever it was) won't have any lasting effect, but it will become legendary of course. Joe Rogan is going to get a lot of hits from that. (no pun untended)

You skipped over the part where Tesla has now become the fastest growing car company in history, beating out Henry Ford automotive days.

Wouldn’t it be fitting that we pass 420 down the line and Elon spliff meme becomes the greatest in-your-face of all time...

 

[beachbum77]

Pretty hard to deliver a car you didn't build first. They built the cars, and they're delivering twice as many this quarter as last. You don't get to call this a lie.

Considering they had 15,058 cars in transit at the end of Q2, Tesla could indeed deliver more than they build in Q3.

 

[Artful Dodger]

Who are they going to find? I mean, seriously, I think they've been looking for that for years, maybe not super actively, but looking. The operations part is the awful part with Tesla -- who are you going to get to walk into that punishingly difficult job, working 80 hours a week, with Musk as their boss looking critically over their shoulder?

The Military. There are literally 1,000s of Senior Officers that work that pace routinely, for far less pay and for almost no recognition. Military Officers usually retire around 55, but can get their pension as young as 42 (after 20 years service).

Elon has talked before about using 'Special Forces' methods at Tesla. I think instead he should look at recruiting some 'Regular Army' leadership for these challenges.

But you've stated your views on the value of Military service here before, so I doubt you've considered the value their leadership brings.

 

[RobStark]

for example, Saleforce and Arista Networks.

Neither of those are involved in heavy industry, so there are orders of magnitude difference in scaling complexity.

And none of the legacy automakers are eyeball deep in software like Tesla.

Tesla is a Conglomerate of Silicon Valley and Detroit Steel.

So it is very difficult to discuss Tesla by analogy.

 

[loky]

Considering they had 15,058 cars in transit at the end of Q2, Tesla could indeed deliver more than they build in Q3.

Considering they had 15,058 cars in transit at the end of Q2, Tesla could indeed deliver more than they build in Q3.

I would try to give a modest contribution to real Q3 production numbers of M3 using official Tesla and EM statements.
Tesla stated on 2nd August that cell annual production at GF1 reached 20 MW. Based on 75KW battery pack, it would be about 5130 M3/week. Reduce it by 5% for ongoing battery storage projects and another 5% for fast ramping, possible cells production in august is enough for cca 4600 M3/week, during July for about 4000/week production rate and when multiplied with 11-12 weeks (reduced for holidays, maintenance, upgrading production lines and time for EM to tweet) we get about 50-55k for Q3, as stated during call.
With additional three cell lines starting production from late September (possible modest impact on Q3 production) to the end of the year (additional 30% at least, I believe that new cell lines are significantly better) , production of M3 during Q4 could be about 70-75k at least, considering cell production.
Also, Tesla already has introduced better paint technology and body production reached for the first time rate of 800/day during Q3 call.
The number of cars in transit for deliveries in US and Canada could be at least Tesla cars production for two weeks, one example:

I believe that Tesla is trying now to make the best compromise between production rate, quality and M3 gross margin.
Personally, I will look at gross margin of M3 at the end of Q3. Any percentages above 10% should be multiplied by at least 5 and added to share price.
I would like to see some good comments on Market Action today, so grr please, move this post to corresponding thread.

So, beachbum77 , please read it carefully . I would ask for your numbers.

 

[beachbum77]

CNBC is reporting Morton was already hired yesterday by Anaplan as their new CFO. I guess job titles matter to him.

 

[Yonki]

This thread is 85% trolls at this point...

Not for me - my Ignore list has ramped up like Model 3 production in the last few months, so for me, this thread is 85% people talking to ghosts.

 

[generalenthu]

The Military. There are literally 1,000s of Senior Officers that work that pace routinely, for far less pay and for almost no recognition. Military Officers usually retire around 55, but can get their pension as young as 42 (after 20 years service).

Elon has talked before about using 'Special Forces' methods at Tesla. I think instead he should look at recruiting some 'Regular Army' leadership for these challenges.

But you've stated your views on the value of Military service here before, so I doubt you've considered the value their leadership brings.

Add long as they can filter the Martin tripps effectively.

 

[X Fan]

CNBC is reporting Morton was already hired yesterday by Anaplan as their new CFO. I guess job titles matter to him.

Anaplan welcomes David H. Morton Jr. as chief financial officer

 

[Zhelko Dimic]

Boomer, I agree with everything you wrote except David Morton. He came in at a salary of $350k, but was also granted a $10 million equity grant payable in 4 years. The man is an accountant. The only way you walk away from that kind of money is if you a) hit the lottery b) find a beautiful, single, rich heiress to marry you, or c) realize the odds of the grant being worth staying around for 4 years are very slim.

“Since I joined Tesla on August 6th, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations,” Morton said in the filing. “This caused me to reconsider my future. I want to be clear that I believe strongly in Tesla, its mission, and its future prospects, and I have no disagreements with Tesla’s leadership or its financial reporting.”

In plain English it means this poor guy walked into a complete "sh*t-storm". While he has no "disagreements" with Tesla's financial reporting he seemingly did not like what he saw ahead. Because otherwise, they would have had to fire him and pry him out of his office to walk away from $10 million. If the poor guy is married he probably came home to another one too! lol

Can you imagine trying to explain to your wife why you walked away from $10 million?

There are parts here I agree with, but overall message is naive.
David is an executive. Opportunities are plentiful for those folks.
He's been part of going private with Seagate, this guy has f... you money already.
At that point you don't work for salary and options, you work for what it represents: scorecard. How well am I doing compared to others? It's about becoming better player, having some sense of purpose, having some sense of achievements and a bit about the money...
So money wouldn't be the most important motivator*, and working inside of a zoo may be unappealing. And while very long, I'm afraid that Tesla is a zoo. That shouldn't affect them too badly at this point, but they'll need to grow up sooner or later.
* My wife is a major gifts fundraiser for non-profit, and she knows many similar folks for whom dispersing the money is a major problem.

 

[DaveT]

Anaplan welcomes David H. Morton Jr. as chief financial officer

Wow, that was fast.

 

[defc0n]

I KNEW yesterday's anecdotes about short interest decreasing were fake news. FUD. I bit my tongue about it because I didn't have receipts but I could tell by the way the info came up in the forum that it was bullshit.

Short Squeeze VERY much on deck

Short interest has gone down quite a lot over the past month.