TSLA Market Action: 2018 Investor Roundtable

[capster]

I don't see anywhere that the cause for the Syrian refugee crisis is drought. Only war.

Syrian refugee crisis: Facts, FAQs, and how to help | World Vision

The Arab Spring supposedly started this whole crisis which also wasn't related to a drought.

Arab Spring - Wikipedia

Publication

"This collection of essays argues that climate change has acted as a ‘threat multiplier’ in the Arab world – i.e., it has exacerbated assorted environmental, social, economic and political drivers of unrest. Some of the drivers include drought, food scarcity and survival-centered migration. They and others like them, the essays collectively conclude, will continue to visit mischief on the countries of the Middle East and North Africa, and they will do so with greater severity as the region’s climate continues to change."

I'm sorry to tell you that, yes, societal disruption due to climate change has begun.

TSLA will prove a much better investment than many that are seemingly safer today, IMHO. Even, or perhaps *especially* in the face of another large war.

 

[scaesare]

I'm certainly in favor of any good EV, but I have my doubts about ability to execute, whether that be Rivian or GM.

But from a Tesla vs Rivian spec perspective, something that I think is getting lost here is that Rivian is talking about to 105 to 180 kWh battery packs in 2 to 4 years yielding up to 400 miles or so of range. By then the new Roadster should be in production with its 600 miles of range. And 1.9s 0-60mph time. In all honesty the specs really aren't that amazing for an EV targeting production 2 to 4 years down the road, its just Tesla-like rather than Audi- or GM- or Mercedes-like.

I'd wager part of Rivian's business plan is to establish themselves as the EV truck maker before Tesla gets around to it. And if they do, more power to them. But they'll have to contend with a rival Tesla truck. Sure, there's room for Rivian and Tesla (and others...) but Rivian is clearly staking out their position as the premier truck. Which has been Tesla's tactic for each vehicle market they've gone after. So the companies will be rivals. Which I think is a good thing.

If Rivian were a public company I'd certainly consider buying stock, but I prefer holding Tesla shares. Thanks to the shorts my average price isn't too bad and I think the stock is still undervalued. Looking forward to the slow but steady climb in stock price as more shorts abandon ship and the media starts to remove their blinders.

I think you may be comparing apples to crescent wrenches there...

 

[EVNow]

I'm certainly in favor of any good EV, but I have my doubts about ability to execute, whether that be Rivian or GM.

Every new entrant in the EV space is going to face more and more of a challenge in establishing the brand and finding customers. So, the challenge is not just execution, but it is also getting customers to trust the new entrant and buy. They need to get extremely good reviews - like Model S got. It helps to have a charismatic CEO, too.

10 years back when there were no EVs, enthusiasts were ready to buy from all kinds of bit players - Zenn, Aptera, Reva etc. Now with multiple established players making EVs it is much more difficult to find customers. Even Apple with gazillions in the bank is finding it difficult to enter EV space.

One option of course is to come up with a different form factor. Mitsu Oulander PHEV and Chrysler Pacifica PHEV are examples. But from established players.

 

[larmor]

Buffalo is not a major city. That part of New York is so depressing that it has among the highest rate of drug overdose in the whole state because when you realize that you're stuck living in Buffalo death seems like an attractive alternative.

Have to disagree here. Went to Buffalo for medical school some time ago and rotated through eight hospitals, did not see huge drug problems. Grew up in upstate NY, and yes there is snow, but at the cross roads to Canada. Very strategic location. FWIW, some time ago, Buffalo had the highest number of MRI scanners per capita-- close to Canada.

The only thing that is curious is that d/t snow and overall fewer sunnier days, that they have a solar cell factory. This is ironic.

From a market perspective, locating a solar factory in a lower cost city, near seaway access-- great lakes, and near Canada, whose large land area is conducive to solar installations due to upkeep of long transmission lines and isolated communities makes for an interesting prospective for solar cell production...

 

[EVNow]

Canada should buy Oshawa from GM or nationalize it and lease it to Tesla.

 

[dc_h]

I think you miss the point that these issues have been brewing for decades of bad policy on both sides of the aisle.

The current leaders do seem to be accelerating the inevitable though.

The trend of the growing current account and trade deficits over the last few decades is unsustainable.

Trade deficits are an outcome of national savings policies, period. The net national savings rate, is approximately equal to the trade deficit. If you have a tax cut that expands the government deficit, that is not offset by corporate or personal savings, the trade deficit will rise. Go back a couple hundred years and you can see how it works. We get away wit due to being the global reserve currency, and we’ve had a higher return on investments then most of the world, so people continue to invest in the USA.
It’s not necessarily bad, but if you want to reduce the deficit, create more savings incentives and reduce govt spending or increase taxes and reduce incentives for corporate leverage—which happens due to most exec pay being in stock.

Mod delete off track if you wish.

 

[dmunjal]

This speech tomorrow will dictate macro for the rest of the year.

Here's what to expect from Fed Chief Powell's most important speech yet

 

[FS_FRA]

M A R K E T

A C T I O N

O N L Y

P L E A S E

!!!

this thread is becoming a pain to read.

 

[Open Interest]

A Chinese source contradicts the original Chinese source....

Tesla's reported 70 percent drop in China sales is 'misleading information,' Chinese auto exec says

This was a banner headline on CNBC tonight. Earlier today Tesla issued a statement saying the drop in sales information was “wildly inaccurate”. Pretty sure CNBC did not post that in a banner!

 

[Fact Checking]

I'm certainly in favor of any good EV, but I have my doubts about ability to execute, whether that be Rivian or GM.

Note that Tesla is currently selling about 0.2 million EVs in the U.S. per year.

A good chunk of the 16.4 million of annual ICE sales, about 80 times of the current Tesla sales, have to be cannibalized and displaced before EV makers will start competing with each other for demand in a meaningful fashion.

Globally there's ~80 million ICE sales to substitute. If Tesla manages to up-sell so many people to pay more for a (much) better car then the EV transition could be a big economic growth phase, expanding the global automotive market from the current ~3 trillion dollars to ~10 trillion dollars of revenue per year.

In terms of Rivian's effect on $TSLA market action:

• Rivian designed really nice cars, I love the design and in particular the quasi-retro yet futuristic look! While I think the Model Y is going to look substantially different, I think Rivian's pickup truck design is pretty close to what Elon had in mind for the Tesla Pickup Truck.
  
• Their 'late 2020' availability date might inevitably slip and Tesla will likely start selling the Model Y close to the date Rivian starts selling their first units.
• Tesla could also have earned 10-20 billion dollars of cash by late 2020 and reinvested it in various interesting ways.
• Even if Rivian executes absolutely everything in a picture-perfect way the Tesla Model Y and Pickup Truck will be a tough benchmark to measure up against - fortunately even in 2020 their main competitor will be Ford, not Tesla.
• Rivian certainly raises the bar for Tesla regarding the design and the specs of the Model Y and the Tesla Pickup Truck.
• Every Rivian pre-order delays an ICE sale and helps Tesla indirectly.

So IMHO there should be little direct effect on $TSLA market action from Rivian in the next ~2 years, and possibly not much effect up to 2025 or so, and I am certainly wishing them good luck!

 

[schonelucht]

That has to be at least a 10% cost advantage right there.

At the rate battery prices are dropping overall, a 10% or even 20% discount becomes less in absolute terms. I would not be surprised that not having to do any work in an non-unionized plant and partially funding labor with stock options is actually the bigger price advantage for Tesla these days.

 

[avoigt]

See below. Vicki liked my reply and I believe this is not only because I stated she likely cannot comment further without getting into trouble.

My assumption is that at their part of production they are above 800 units a day (5600/day) now pushing the envelope or call it burst rate. 800 was about the previous record I think. This is because Elon will be around the next days to use his superpower identifying the bottle neck and doing some magic to make them go to 1000 units. Thats the goal. Everything above overachievement.

In the next weeks they will implement all required changes and if it works be able to go end of the year to a steady rate of 1k Units per day. The annual run rate is at that point 350 +100 = 450k units.

Thats how they will start into 2019. Given the short time they need to ramp we can fairly expect that further improvements are possible until they level out. The plan is then over the course of 2019 to go to 10k which is just another 30% improvement.


VICKI SALVADOR‏ @VickiSalvador
So close to breaking our record tonight for cars shipped. If we could just speed that line up just a little bit... I know it can be done.

6:10 AM - 27 Nov 2018

Alex‏ @alex_avoigt
Replying to @ValueAnalyst1 @VickiSalvador
Vicki likely cannot clarify further without getting into trouble. These are the days Elon walks along the entire production to test if every section is able to perform 1k units/day. I believe she indicates they are close to the former daily record. +800 I assume...

9:29 AM - 27 Nov 2018

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1. 
   1h1 hour ago
   Mind you It’s just on the line that we threw that number out there nobody upstairs is telling us that we need to do 10,000 that’s the number we just would like to hit
   
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   5h5 hours ago
   People are going to be on their toes today and tomorrow!
   
   15 replies4 retweets60 likes
   

 

[Tslynk67]

If Rivian is making 50k vehicles per year in 2022 and growing with an average pack size of 140 kWh who says LG Chem doesn't build a GF in Normal, IL and not 240 miles away?

LG Chem is building a 70 GWh factory in Poland to service German car companies.

No way in hell that Rivian will be making 50k in 2022 - 5k if they're lucky. Look at what we've just been through with Tesla, with all the smarts and capital they've had at their disposal... not to mention our very own GF1...

One way out of it could be if an incumbent were to buy them out and scale it, that might work, but as a start-up, they're not getting there that fast regardless of how many people want their car.

I do wish they succeed - every EV on the road is one step towards Mission accomplishment and less pollution in our lungs. Besides that, competition is healthy, for Tesla too.

 

[Tslynk67]

Not sure why people are arguing Tesla vs Rivian? You guys got it all wrong. When Rivian launches, Tesla will have their upgraded models to 1 up the competition. There's no doubt about that, Tesla isn't just sitting back watching competition come out with impressive specs while doing nothing. But the real story here is that it won't be Tesla vs Rivian. It's going to be Tesla + Rivian vs legacy automakers like GM, Ford, Toyota, etc..

There's plenty of room for more quality EV's in the EV market space. Rivian is really the first BEV revealed other than Tesla where I feel they've got nice design appeal as well as impressive specs. All the others, like Mercedes EQC, Jag I-PACE, Kona, etc.. have outdated specs and questionable design choices. So if Rivian can come out and do it right, build EV's that people will like, with impressive specs and range, then more powers to them. That's what we need more of, BEV's that impress.

The media wants you to focus on "Tesla killers", but it'll really be Tesla and Rivian killing legacy automakers if they don't catch up. I'm looking at you GM & Ford, you can't hide behind internal combustion engine trucks and SUV's forever.

Indeed, all good EV's are ICE-Killers - the addressable market is huge and fossil-fuels are gradually being regulated against in most forward-looking countries, this to be followed by wide-scale disapproval by the general population, like smoking and drunk driving.

USA is an anomaly for the moment, due to the current regime, but this won't last forever.

 

[Tslynk67]

Pre-Market is dead, I guess everyone's waiting for this Fed speech?

 

[SpaceCash]

Pre-Market is dead, I guess everyone's waiting for this Fed speech?

I have never seen it trade THIS thinly.

 

[Unpilot]

Or sleeping...like I should be.

 

[lklundin]

Hell, counterintuitively, the dollar being the world reserve currency is actually a net negative for the US economy since it mathematically forces us to run large capital account surpluses and therefore trade/current account deficits.

This claim is indeed counter intuitive.

A dollar bill is an IOU issued by the USA. So when a lot of people in the rest of the world hold US dollars, it means that the US owes those money holders value equal to the amount they hold.

In other words: Every dollar held outside of the USA is a (small) interest free loan to the USA. Added up, this is a big advantage to the USA - and it is a disadvantage to the holders of that money, which loses value every time the US prints more money.

Anyone with a better understanding of this should feel free to reconcile the above two claims.

 

[Tslynk67]

Or sleeping...like I should be.

Seems a few people woke up in the meantime...

 

[Carl Raymond]

This claim is indeed counter intuitive.

A dollar bill is an IOU issued by the USA. So when a lot of people in the rest of the world hold US dollars, it means that the US owes those money holders value equal to the amount they hold.

In other words: Every dollar held outside of the USA is a (small) interest free loan to the USA. Added up, this is a big advantage to the USA - and it is a disadvantage to the holders of that money, which loses value every time the US prints more money.

Anyone with a better understanding of this should feel free to reconcile the above two claims.

I only know that when the USD rises 1% (against our dollar), so does the value of my portfolio in AUD. As does yours, if you were, for example, selling a few shares to take a holiday in Australia.

So of course I'm cheering for both TSLA and the USD. A rise in one is as good as a rise in the other (unless I need to buy something from the US, like a model 3, for example).