TSLA Market Action: 2018 Investor Roundtable

[Joe F]

Haven't seen this posted here. Seems GM starting to throw in the towel. It's a start:

$GM TO ANNOUNCE SIGNIFICANT PLANNED REDUCTIONS TO NORTH AMERICAN SALARIED, EXEC WORKFORCE - SOURCES

* GM DECISION PUTS FUTURE OF 3 GM ASSEMBLY PLANTS IN DOUBT - SOURCES

* GM TO STOP ALLOCATING PRODUCTS TO 3 NORTH AMERICAN ASSEMBLY PLANTS IN CANADA, OHIO, MICH

via @Reuters

 

[KarenRei]

Pre-market head fake.

No kidding. Not funny while I'm waiting for a call buy to go through :Þ

 

[Unpilot]

So with volume up to almost 1 million is the first 15 minutes....does this indicate a heavy volume day?

Historically is the week after Thanksgiving heavy?

 

[neroden]

So my comment was already way too long, and I intended to covered that angle with my reference to @neroden's article:

Basically IMHO there's a fundamental, order of magnitude speed difference between the 'EV transition' and 'the electrification of transport':

Agreed, there is...

• The automotive industry largely depends on 'new car sales'. In Norway EV sales already crossed the 50% threshold when EVs were only something like 10% of the total vehicle fleet. With the average car life cycle of 7 years, increasing steadily, that's a multiplication factor of 7x.
• The transportation industry depends on the current commercial vehicles fleet. EV conversion is slower in that space due to commercial transport being a lot more fuel cost sensitive than consumers to whom convenience and transport of transportation and refueling has a big value as well. Growth could easily be another ~40% lower in this space.
• There's a lot of fuel used by the airline industry, and there kerosene has obvious mass density advantages. Planes also have even longer life cycles: if maintained properly a plane can last for decades.

I.e. even with the Tesla Semi I'd estimate the growth of the EV vehicle fleet that stops consuming gasoline/diesel to be about 10 times slower than the growth of EVs in new vehicle sales.

You've made one false assumption here, though. Commercial trucks will be replaced with EVs much faster than personal cars, precisely because they are much more concerned about fuel and maintenance costs. Even with a low oil price, EVs still save money on fuel and maintenance in the commercial truck arena. Low oil prices do affect the TCO calculations; it may mean that the Tesla Semi needs to hit a lower upfront price point than it did with higher oil prices. But commercial operations also dislike being exposed to the fuel price fluctuations -- electricity is a lot more stable. So they will switch. And the lifetime of commercial trucks is *short* compared to car lifetimes, so the fleet will turn over faster.

Gas stations might long be on the decline and owning a gasoline car might already be a social stigma, while much of commercial transport will still be using diesel.

Extremely unlikely. Commercial transport will go first.

Then there's also the various industrial processes that use oil for heating - those take time to replace as well.

They do, but there's been a move away from oil for those processes since the 1970s, so it's already insignificant in quantity.

Corporate valuations of fossil fuel companies is a different matter - there the long investment cycles work against their valuation, as many investors will try to look 1-2 decades into the future.

I.e. there's a lot of natural short-termism in the price of oil, but, somewhat paradoxically there's a lot of long-termism in the valuation of fossil fuel related companies.

That's certainly true. The oil stocks should crash before oil itself does. In general they haven't because so many investors still think oil will be popular forever.

 

[KarenRei]

So with volume up to almost 1 million is the first 15 minutes....does this indicate a heavy volume day?

Historically is the week after Thanksgiving heavy?

The traders are.

 

[neroden]

So the Mandatory Morning Dip was early today. It's usually at 10AM but it was at open this time. New strategy by short-sellers, pushing the dip in premarket? Who knows.

 

[Krugerrand]

Elon Musk: Tesla had 'single-digit weeks' as it teetered on brink of collapse

Can Elon just stop talking... I hope he is just laying out a bear trap

It’s an interview, he’s required to talk. And no he can’t stop being honest when he talks and he shouldn’t. Honesty is a valued trait. I know we’ve been programmed since childhood that lying gets us further in life but that’s wrong. Secondarily, *we* already knew the financial situation of Tesla just as we do now. Not a secret anymore than production hell - all very real. *We* were told Model 3 was a bet the farm. *We* were also told it was the last bet the farm event.

Here’s the most important takeaway, though: It’s in the past and Tesla won.

Here’s another takeaway: it won’t be any easier or less traumatic and risky for anyone else. And nobody else has Elon, JB, Franz or the legion of top talent as Tesla.

So the argument of everyone else doing what Tesla has done, catching up, blah, blah, blah is as ridiculous today and it was 6+ years ago.

 

[Fact Checking]

2) Elon’s leaked email stated 50 units/hour SUSTAINED per subsystem. I was over-optimistically hoping that meant December production at 7k/week sustained. In light of carsonight’s comment I now think 7k/week burst is the goal for end of December, hopefully meaning 7k/week sustained in early q1?

So I if you read carsonight's comments, he says 7k Model 3 burst by Christmas, which, if it's not the final week leading up to Christmas still leaves about ~13 days to still finish and deliver the final batches of Q4 Model 3's to west coast customers in Q4 - presumably mostly Medium Range variants.

I'm not sure they'd want to do a burst 7k at the very end or even middle of December, because that would just needlessly increase inventory levels with battery packs that cannot be put into cars and delivered anymore.

Note that technically they could also hit 7k/week in Fremont, with pre-inventoried battery modules. That they are pushing pack assembly at the Gigafactory so hard suggests that battery pack assembly is the temporary bottleneck right now.

 

[Krugerrand]

I couldn't resist posting of few of the trolls comments (actual comments, not an actor):

• "Lots of rats jumping ship"
• "Tesla is in big trouble. Their design of electric motors is now obsolete. New design is 50% of cost and 100% more efficient. Will cost them $10 billion to complete and they don't have the money"
• "It doesn't seem like a good idea to begin one's career at a company where people must work themselves to the point of exhaustion to cope with dysfunctional processes"
• "Not to mention the fact that Tesla will be bankrupt in the near future."
• "A manufacturing company which can't manufacture anything. A company built on funded by powerpointing."
• "Coal is better for the environment, it pollutes less than making batteries and then disposing of them. While I can’t prove that, greenies, haven’t proven otherwise."
• "Pet Rock of 2018, the junk yards will be full of Tesla's."
• "VW, Volvo, BMW and just about every other real car manufacturer will have production up and running in a few short years.
• Tesla will be servicing billions of debt while still trying to figure out the production and distribution side of the business - not to mention quality. Just tell me why in the world I would buy a Tesla when I can buy a higher quality VW and get it serviced just about anywhere?"

I want a ‘that’s too stupid to even be funny’ button.

 

[ZachF]

Haven't seen this posted here. Seems GM starting to throw in the towel. It's a start:

$GM TO ANNOUNCE SIGNIFICANT PLANNED REDUCTIONS TO NORTH AMERICAN SALARIED, EXEC WORKFORCE - SOURCES

* GM DECISION PUTS FUTURE OF 3 GM ASSEMBLY PLANTS IN DOUBT - SOURCES

* GM TO STOP ALLOCATING PRODUCTS TO 3 NORTH AMERICAN ASSEMBLY PLANTS IN CANADA, OHIO, MICH

via @Reuters

Since Trump is so obsessed with American companies building things in America, maybe he should come to his senses and get behind the one American auto company that's massively increasing it's American manufacturing capacity? I know... it's nice to dream, lol.

 

[Causalien]

It’s an interview, he’s required to talk. And no he can’t stop being honest when he talks and he shouldn’t. Honesty is a valued trait. I know we’ve been programmed since childhood that lying gets us further in life but that’s wrong. Secondarily, *we* already knew the financial situation of Tesla just as we do now. Not a secret anymore than production hell - all very real. *We* were told Model 3 was a bet the farm. *We* were also told it was the last bet the farm event.

Here’s the most important takeaway, though: It’s in the past and Tesla won.

Here’s another takeaway: it won’t be any easier or less traumatic and risky for anyone else. And nobody else has Elon, JB, Franz or the legion of top talent as Tesla.

So the argument of everyone else doing what Tesla has done, catching up, blah, blah, blah is as ridiculous today and it was 6+ years ago.

Traumatic to me too. Even though I wasn't in the trench fighting. It'd be very damaging to my life if tsla were to fail. Part of it because of the reputation damage from everyone I spread the EV gospel to.

It affectrd me enough to make me shun risky investment for the forseeable future.

 

[Krugerrand]

What are they celebrating about? That when Tesla was close to failing that they pulled through and came out the other side stronger? (For the second time. And that Elon said he will never pull a bet-the-company product launch again?)

Not second time. At least 4th time by my count. Which I don’t say merely to correct you but as a significant reference point and to back up one of Elon’s most famous quotes; ‘I don’t ever give up. I’d have to be incompacitated or dead.’

 

[RFernatt]

It’s an interview, he’s required to talk. And no he can’t stop being honest when he talks and he shouldn’t. Honesty is a valued trait.

But there's a difference between honesty and providing excess information. I can invite folks over to my house and play host, but I don't have to show them the darkest recesses of the basement or the attic. When my guests leave, I don't want them focusing on my messed up basement/attic.

 

[pz1975]

But there's a difference between honesty and providing excess information. I can invite folks over to my house and play host, but I don't have to show them the darkest recesses of the basement or the attic. When my guests leave, I don't want them focusing on my messed up basement/attic.

Yikes...what do you have hidden down there - Mark Spiegel’s soul?

 

[Krugerrand]

Traumatic to me too. Even though I wasn't in the trench fighting. It'd be very damaging to my life if tsla were to fail. Part of it because of the reputation damage from everyone I spread the EV gospel to.

It affectrd me enough to make me shun risky investment for the forseeable future.

Meh. You’ve known all along the risks. You can’t claim ‘woah, is me’. You’re not even the one doing all the work. You’re talking to people like the rest of us, when you feel like it and how you feel like it. You’re concerned about your ‘reputation’ for telling people what needs to be done to save this planet?! And money wise I assume is the other part. Well, I don’t feel about money the way many others do, so I’m unhelpful in that regard too.

Thank you for supporting Tesla as long as you have, but if you no longer have the stomach for it or other risky investments that’s fine, you served your purpose in the moment and did what you could do. We’ll take it from here. My daddy taught me the same lesson as Elon lives by; never give up.

 

[Intl Professor]

It’s an interview, he’s required to talk. And no he can’t stop being honest when he talks and he shouldn’t. Honesty is a valued trait. I know we’ve been programmed since childhood that lying gets us further in life but that’s wrong. Secondarily, *we* already knew the financial situation of Tesla just as we do now. Not a secret anymore than production hell - all very real. *We* were told Model 3 was a bet the farm. *We* were also told it was the last bet the farm event.

Here’s the most important takeaway, though: It’s in the past and Tesla won.

Here’s another takeaway: it won’t be any easier or less traumatic and risky for anyone else. And nobody else has Elon, JB, Franz or the legion of top talent as Tesla.

So the argument of everyone else doing what Tesla has done, catching up, blah, blah, blah is as ridiculous today and it was 6+ years ago.

For my simple mind to understand, it is improbable to suppose the big boys can ramp up faster than Tesla has already done. And, as noted here multiple times in the past, that ramp at Tesla is not done.

 

[Krugerrand]

Gosh, of course it is relevant!!!! What would have happen if he said

'well you know we had some smaller problems there and there but you know we were always easy going and never short of money. I look forward to model Y production ramp as the ramp for model 3 was already quite easily done without any threats to Tesla. There is no need to worry.'

Imsgine this quote from him and the impact it would have had on the share price

Because it would be a lie. Relax. You’d think you were the one who had to do all the work.

 

[uselesslogin]

GM halted? Interesting.

 

[KarenRei]

TSLA keeps going up and up and up... each time I raise my bid, the stock goes up, and the ask goes up... if it goes much further I'm just going to stop raising my bid, this is just annoying. :Þ Almost 2% over NASDAQ.

Actually, I'll rephrase: I am done raising my bid :Þ I no longer consider this a great buy on options. Good, but I think odds are good enough that better buys will be in the pipeline that I'm willing to risk being left out.

 

[W84M3]

GM halted? Interesting.

Adapt or die.

Seems GM needs to bet the company....