TSLA Market Action: 2018 Investor Roundtable

[Fact Checking]

With all these improvements, what do you think the loss per car will be?

Yeah, I think with as ASP of $55,000 they'll lose about -$13,750 per Model 3 on average.

 

[replicant]

I'm curious about the "Disagree" here, @9837264723849 - is it my reasoning or that you don't like OT posts?

View attachment 351341

Sorry, I simply disagreed with this: "And then extrapolating this, a copy of everyone can be stored too when you die, recreate your younger body, but swap it for your older brain. Humans become immortal."

In my opinion, if you change a body, you necessarily change its mind (cf. Spinoza on the mortality of the soul, best would be to read the Ethics but this summary is okay) I didn't comment because I still don't know how to explain monism (esp. in a language than isn't my native tongue), although the idea is intuitive to me.

 

[NicoV]

Shorts reaction:

Q1 18 - "Tesla can't produce the Model 3!"

Q2 18, Model 3 starts to ramp - "Tesla can't make a profit on the Model 3!"

Q3 18, Tesla is profitable - "This is as good as it will ever get. Only profitable because pent up Performance demand and now ASP and margin will go down from here."

Q4 18, record deliveries/revenue/profit - "That's only because end of year tax credit expiring that pulled demand forward. Now demand will collapse in 2019!"

Q1 19, European deliveries begin, Performance version and awd first, margins pick up again - "That's only because pent up Performance demand and now ASP and margin will go down from here."

Q2 19, China deliveries begin with Performance and awd versions first. Standard battery Model 3 deliveries begin. Record revenue and profit. S&P inclusion. - "OK, now demand is finally saturated, there are no new markets to pick up the slack. No where to go but down from here!"

Q3 19, Model Y unveil. Reservations surpass 500k in one week. - "... Tesla can't produce the Model Y!"

Model Y reveal is March 2019 iirc

 

[Words of HABIT]

Old smartphone to new smartphone is not a great analogy for old solar panel to solar panel. The new solar panel still produces only energy, just as the old one did, it offers no new bells or whistles, just more of the same for less square meterage.

It is an issue for the economy to plan for, that the worlds need for panels will be met at a date prior to their retirement from degradation. A huge industry will hit a wall.

There will always be new buildings (residential, industrial, commercial) and each new building will require solar. In recessionary times building may slow, however IMHO I never would foresee solar "hit a wall" to hit a wall.

 

[RobStark]

This will spur end of year sales.

Sticker color change confirmed. Not sure why people were betting on it staying red. I sure as hell didn’t.

https://www.dmv.ca.gov/portal/wcm/c...ac-8e8cbea4a69b/18vin16.pdf?MOD=AJPERES&CVID=

Uugh, lavender?

 

[scaesare]

That makes my brain hurt...

Ys, but THIS brain, or a copy of your brain elsewhere?

 

[scaesare]

Tonight while driving home I got a weird phone call, right out of the blue, from a 725 area code. I assumed it was a scammer call, but I answered anyway.

Guy identifies himself as being with Tesla, doesn't say where he is, just launches into a pitch, saying that he wanted to know if I could come in this weekend and that they'd really like me to take a look at some of the models they have and did I know the company recently introduced a mid-range battery that is more affordable and etc etc etc -- he went on for like two full paragraphs of words, including I could come to the Littleton (Colorado) store or the Denver store or this or that and I'm thinking, WTF, and I could not get a word in edgewise.

Finally he takes a break for oxygen and I tell him, uh, I live 400 miles from Denver, in New Mexico (it's a U.S. state: look it up, Tesla) and would need a hotel to stay in if I were so inclined to go up to Denver. Then I said, "I assume you are talking about the Model 3" as he had never mentioned the car in his entire spiel. "Yes," he said, then went on to indicate that he knew I held a reservation for a Model 3 (since March 31, 2016) and was urging me to put in an order before the end of the year "when the $7500 federal tax credit expires."

I was thinking: wow.. Tesla's pulling a demand lever. They're calling dormant reservation holders.

I told him, um, yeah, like, thanks for the call and all, but you caught me driving home in my 5-year-old Model S with 91,500 miles on it and five drive units and a slew of other issues (not that I am complaining, I love the car and will buy another someday) but that we were painfully aware (clearly more than he) of every aspect of the Model 3's progress (and Tesla's progress) in every aspect, and that we were patiently taking our time to place an order for a Model 3.... we kinda wanted to wait until a few more hundred thousand VINs were pumped out of Fremont before we got rid of our one remaining ICE vehicle and went pure EV in a state that does not allow Tesla, thanks to laws put on the books by the evil auto dealer cartel, to open even a single store or service center and has state senators threatening to sue Tesla to block *Rangers* from servicing customers anywhere in the state (!). So yeah, we're gonna hold onto the ICE for a while yet.

He then switches scripts and goes into negative-selling-mode suggesting I go to the My Tesla page and request a refund of the $1000 reservation as it's just sitting in there "earning zero percent interest" and that I probably could find a better use for the thousand bucks (to which I told him yeah, in hindsight it would have been wiser for me to buy 4 or 5 additional shares of TSLA back in early 2016 . . . to which he agreed. He said in so many words that my Model 3 reservation is now useless and that it's not actually beneficial and anyone can order a 3 now.

What surprised me about the call was:

• I imagined some grungy call room in Vegas (area code 725, it turns out) where the cast of "Glenngarry Glen Ross" were sitting around on rotary phones dialing the loser leads like me, trying to drum up some interest on a cold Friday night in November.
• He didn't appear to know anything about me.
• He didn't know where I lived, even what state I was in -- assumed I was local in Colorado (!?)
• He didn't sound very experienced or knowledgeable or effective as a sales person
• He didn't particularly care what I did though I got the distinct impression he wanted me off the reservation list, one way or another, and that was the purpose of the call.

Anyway: take this as a single data point. But it looks like Tesla is calling people. Is this a new phenomenon? Anyone else get such a call?

I got a sorta similar call. It was out of Vegas and I didn't recognize the number, so I let it go to voicemail. The message indicated that it was Tesla rep that wanted to talk to me about customer satisfaction.

I called it back, and indeed he did ask he how my experience had been, any issues, etc... and he did sound like he was typing notes. But he did get in to a "we'd like to schedule you for an overnight test of a new car so you can experience all the improvements" pitch after a bit.

It wasn't too pushy, but definitely was salesy. To his credit, he made good on having the local svc center call me about a question I had...

 

[traxila]

Anyone have interoperation of the reason JB exercised then sold 15k options, and at the same time gifted 20k stock to charity?
Anything we should be worrying about? He still holds 306k though.

He was hungry and sat down to eat some freshly baked options. He found them tasteless to the point of nausea not to mention sorely lacking in nutritional value. One of his colleagues explained he could actually sell the options to get money to buy those gourmet meals he loves so much. He was very happy to do so.

 

[AlMc]

Absolutely! I'll be the first in line for the Model Y.

No, my friend, you will be second in line.

 

[SpeedGoat]

Again, you're evading my point. And you're repeating misleading talking points.

US taxes fall on the highest earners, yes. Those with the highest unearned income, by contrast, get a free ride. Great for us stock speculators, but not really a good way to run a country.

The biggest and most successful scam run by the Republican Party in the US is convincing ignorant voters that this country's rich people "earn" their money by "working". The IRS actually has definitions for "earned income" and "unearned income". Guess which sort rich people like me get most of their income from -- the "unearned" category.

This isn't an illusion shared by people in the UK; they know that their aristocrats and billionaires get their money from unearned income. And most people are OK with that -- just as I don't mind if someone wins the lottery -- but the point is, they are perceiving the situation accurately. In the US, we have a lot of people with a misperception.

----
Back to Market Action. MMD in progress -- I really wish I had the personality to be a day trader, because I could be making so much money on this pattern.

What is unfortunate to me is that some people can't view matters of public policy through any lens other than politics. I am not a member of a political party and what I have stated are not "talking points."

A progressive tax is simply a tax that increases in percentage as income levels rise. A progressive tax is -not- synonymous with high taxation, nor is it synonymous with a wealth tax, etc.

A tax that taxed earners below $1 million nothing, and above $1 million $1/million up to $10 million, and $10/million up to $100 million, etc, would be both a very very low rate of taxation, but highly progressive as the burden of taxation would fall exclusively on those making more than a $1 million, the very small minority of the population.

See here for one reasonable definition:

progressive tax is a tax in which the tax rate increases as the taxable amount increases.[1][2][3][4][5] The term "progressive" refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the person's marginal tax rate.[6][7] The term can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime. Progressive taxes are imposed in an attempt to reduce the tax incidence of people with a lower ability to pay, as such taxes shift the incidence increasingly to those with a higher ability-to-pay. The opposite of a progressive tax is a regressive tax, where the relative tax rate or burden decreases as an individual's ability to pay increases.[5]

Progressive tax - Wikipedia

The US tax system is highly progressive, one of the most progressive in the developed world. That is a simple factual statement.

Now you could argue that the US should tax something else, or alter its taxes to be still more progressive I suppose. I haven't advocated any position or change on tax policy, simply stated the facts.

Mod: I'm not formally trained in logic but the issue here is quite clear. You fail to distinguish between tax rate tables and effective tax rates. Lawmakers are counting on this confusion which is why it is there, as pointed out later in this discussion. I can't imagine a sophisticated investor who is not aware of this and they certainly are missing out on a home ownership deduction in the U.S., just one of many benefits to the propertied classes.

Further posts on this topic will be deleted. Compared to many advanced economies the US makes working for a living very hard and the lucky few easy to control the laws on taxation. Just look at how surprised many Republican members of the House have found campaigning on the recent tax bill. That is waking up our notoriously quiescent population.

 

[SpeedGoat]

That is false, it is one of the "Big Lies" about U.S. taxation: in the U.S. vast categories of the income of the richest 0.1% are not taxed at all, or are taxed at very low rates. The effective tax on new wealth earned by the richest 0.1% is less than 10%...

I cited the numbers and gave you references in past replies to you: in reality the U.S. taxation is one of the least progressive ones of all advanced economies, and certain taxation policies are highly regressive.

For example the Gini Index of the U.S. is worse than that of Europe, Australia, Canada and Japan:

This is also rather off topic for the Market Action thread.

It is not false. See my post above for a definition of what "progressive tax" means.

Also, the map you have posted is talking about Gini index, which is not a measure of taxation.

In economics, the Gini coefficient (/ˈdʒiːni/ JEE-nee), sometimes called Gini index, or Gini ratio, is a measure of statistical dispersion intended to represent the income or wealth distribution of a nation's residents, and is the most commonly used measurement of inequality. It was developed by the Italian statistician and sociologist Corrado Gini and published in his 1912 paper Variability and Mutability (Italian: Variabilità e mutabilità).[1][2]

https://en.wikipedia.org/wiki/Gini_coefficient#cite_note-2
Gini coefficient - Wikipedia

Tax policy -can- attempt to influence wealth distribution within a society but that is hardly a given. Taxes have been designed to serve an incredible array of policy goals.

The Gini index is just an expression of relative equality or inequality. A county where everyone is poor would score highly, as long as they were equally poor. (one might look at Ethiopia and Afghanistan on your map)

 

[SpeedGoat]

Performance Upgrade Price Change! | Tesla Motors Club - 67 pages now.

I admit I was pretty annoyed with how Tesla handled things and tweeted over to Elon but there is taking it TOO FAR.

Tesla is going to have to tread real carefully as the base price goes down. Those who pay the least, expect the most. :/

Who had luck going back to the GM Dealership to get $5,000 back or free unlimited charging?

General Motors Cuts Price of Chevy Volt by $5,000

I wish they would be more predictable with their price/option changes. One of the nice things about Tesla is that there is such transparency about costs, etc. If they make too much of a habit of changing pricing and options on a week to week basis it will start to frustrate people. I just purchased a Model 3 myself and in the time between when I placed my order and took delivery Tesla introduced the mid-range battery pack and changed the pricing on the AWD twice. (if I remember correctly)

 

[SpeedGoat]

Shorts reaction:

Q1 18 - "Tesla can't produce the Model 3!"

Q2 18, Model 3 starts to ramp - "Tesla can't make a profit on the Model 3!"

Q3 18, Tesla is profitable - "This is as good as it will ever get. Only profitable because pent up Performance demand and now ASP and margin will go down from here."

Q4 18, record deliveries/revenue/profit - "That's only because end of year tax credit expiring that pulled demand forward. Now demand will collapse in 2019!"

Q1 19, European deliveries begin, Performance version and awd first, margins pick up again - "That's only because pent up Performance demand and now ASP and margin will go down from here."

Q2 19, China deliveries begin with Performance and awd versions first. Standard battery Model 3 deliveries begin. Record revenue and profit. S&P inclusion. - "OK, now demand is finally saturated, there are no new markets to pick up the slack. No where to go but down from here!"

Q3 19, Model Y unveil. Reservations surpass 500k in one week. - "... Tesla can't produce the Model Y!"

I would love to know how Tesla plans to manage the rollout in Europe.

I figure right around the end of Q4 they can expect a significant drop-off in demand in the US due to the tax credit phaseout, anyone on the fence will do what they can to buy this year of course. At the same time Tesla will presumably begin to shift a significant portion of its production to Europe where it presumably has numerous buyers waiting to take delivery of higher-optioned Model 3s...but shipping time, etc, could lead to a drop in deliveries in Q1 even if production has risen. I would also expect to see a European version of the delivery problems Tesla had in the US as it ramped production of the M3.

 

[Unpilot]

Actually, if teleportation ever became a reality, you wouldn't have to send water, you'd use it to create water. Essentially a teleportation device would be encoding an object, deconstructing it, then reconstructing in another location.

You could actually remove the deconstruction step and given a suitable raw-supply of the necessary elements, reproduce what's needed.

Essential a teleportation device is a machine that copies. Ergo, you only need to make one, or many two, then it can copy itself indefinitely. No need to manufacturing anything any more. Gold, platinum, diamonds, physical currency all become worthless immediately.

Hunger, need, poverty would al cease to exist.

If it were the case that living things could be teleported - although look at all the problems Jeff Goldblum had with that! - then you could also copy that entity, assuming, of course, that the conscious isn't something intangible, but rather just a function, probably quantum-driven of the thing's brain.

Then you could also imagine that in deconstructing a human being, you could make some tweaks, on a basic DNA level. You could improve people, remove defects, disease, edit stuff.

Back to the fire, you could use it to remove the burning items and dump them, say on Mars - in Elon's fireplace, you could even phase this over time, no need to do it all in one go, the "fire" can be stored indefinitely, I guess until needed.

And then extrapolating this, a copy of everyone can be stored too when you die, recreate your younger body, but swap it for your older brain. Humans become immortal.

Something I've given thought to for some time, it's quite a conundrum.

That's one way to live a lot longer...the other way is to just replace the worn out bits.
Essentially treat the body and mind as say a car. There is no reason a car can't run a very, very long time if you replace whatever wear's out.

We currently replace some parts (knee's hip's heart's) and current trends are to be able to replace more even down to the cellular level.
Nano bot's, stem cells who knows what's next. Great time to be alive!

 

[SW2Fiddler]

I just went to sleep for a couple of hours. Or was it a couple of deccenia? Are Tesla making teleportation devices now? Anti-matter energy storage? BECs? Not BEVs?

This thread is next level.

Larry Niven has already hashed out the real-world implications of teleportation: conversion of airports to mass-transit hubs, dealing with removing/replacing potential energy, etc. in a most entertaining way. I like how with a bit of initial “if this minor impossibility were solved,” after that point his stuff would actually work!

If you want your teleportation in cinematic form, check out The Prestige for

Spoiler

a humdinger of a Tesla Killer.

 

[SpaceCash]

My take on the now-quite-limited options for S&X;
They're about to do a refresh on those models maybe at end of Q.

I told my test drive rep straight up that I'd probably wait til new battery/refresh to get one even if my options take off (more) this week. The dream plan is, 2020 Roadster reservation and refreshed S P120D whenever that comes out. This assumes all funding secured, which for the moment it is NAAHHHHT

 

[ggr]

Anyone have interoperation of the reason JB exercised then sold 15k options, and at the same time gifted 20k stock to charity?
Anything we should be worrying about? He still holds 306k though.

I assume the reason he gave stock to charity is because he wanted to make a significant donation. If you have long-term capital gains, giving away the stock has serious tax advantages. Here's an extract of something I wrote for a non-profit to give to some of their higher value donors.

Suppose for a moment that you want to give some money to your favorite 501c3 (that is, tax deductible) charity. For sake of argument and easy calculation, let’s say $1000. Let’s also assume that you make enough money that you’re in the top tax bracket, live in California, and have some of it invested in stocks, and that you itemize your deductions. The IRS encourages people to give to charities, to the extent that they allow you to deduct that donation from your taxable income. So next year, when you file your taxes, the IRS/FTB will actually give you back about $505 of that money. (Approximate numbers based on current (2017 after the Tax Cuts and Jobs Act) tax rates, including CA state tax. I am not an accountant.) They actually paid more to your charity than you did!

But that $1000 had to come from somewhere. If you take it out of your work pay cheque, the IRS already deducted the same amount, so really when the dust settles it just means you paid your tax to the charity instead of the IRS and California. A more worthy cause, anyway.

If you have stocks that you’ve held for more than one year, and sell them to raise the money, the profits from the sale are deemed Long Term Capital Gains, and are taxed at a lower rate (20%). At this point I need to use a concrete example. At the end of 2012 I bought some Intel stock for about $20 per share. Last week (2016 when I originally wrote this) Intel was about $33 per share. If I sell 30 of these shares of Intel, I raise $990 cash to give to charity. Of that money, some of it is just my own capital back, but $13 per share is profit: that’s $390 profit taxed at about 27%, call it $105 tax. So you’ve paid a lot less tax, but the IRS still lets you deduct the whole amount for the full benefit.

So far everything I have said about the tax you pay is just standard. But the IRS likes charities and has an even better benefit. If I just give the stock directly to the charity, without selling it first, the charity will send me a letter saying that the value of the stock was $990, and I still get to deduct that whole amount from next year’s income. But I never sold the stock, and don’t owe any capital gains tax! So I’m $105 better off than selling the stock and then donating the money. In case you’re wondering, this is perfectly legitimate and was the intent of the law. In fact, the 2017 tax law just increased the amount of charitable donations you’re allowed to deduct to 60% of your total income. (I guess that’s because it mostly affects rich people. Sorry, can’t help but snark.)

My example of Intel is fine enough, but if you happen to have some 2012 vintage Tesla in your portfolio, the advantage to you of giving the stock instead of cash becomes huge. Basically the more profit you are sitting on in the stock, the better off you are donating rather than selling. If you didn’t make a profit on the stock, though, you are conversely better off selling it to take the capital loss as a deduction too.

Donating stock is a little bit more of a hassle than just writing a cheque, but the development staff will happily help you with the numbers you need. Then just fax a form to your stockbroker, and it will happen. It usually takes a week or two, so don’t wait to do it at the end of December.

JB is sitting on $330 capital gains for each share of that $20 stock.

 

[ggr]

As amount is small, pretty much thanks giving shopping money?
Or is it standard practice as a year end tax maneuver?

I think one bullish point is it debunks a short thesis that there is a big problem looming so insiders could not sell with knowledge of it.

He can give away stock any time he wants. The option exercises will have been pre-arranged, as has been discussed many times here.

 

[ZachF]

RIP Lambo

I can't wait until Roadster 2.0 starts dropping ICE cars like they're standing still.

 

[Unpilot]

My take on the now-quite-limited options for S&X;
They're about to do a refresh on those models maybe at end of Q.

I told my test drive rep straight up that I'd probably wait til new battery/refresh to get one even if my options take off (more) this week. The dream plan is, 2020 Roadster reservation and refreshed S P120D whenever that comes out. This assumes all funding secured, which for the moment it is NAAHHHHT

Yeah my lotto option call did not come thru either...just gotta wait a few more years for my long position to play out.