TSLA Market Action: 2018 Investor Roundtable

[EVNow]

As you pointed out, they’re more or less doing exactly that through algos, they have the same programs picking up the same signals, then amplifies it into self-fulfilling prophecy.

While may use similar programs - they are all configured differently. The MMs are still in competition with each other, not co-operating in a conspiracy. Think of them as Republicans & Democrats - lots of similarities but still in fierce competition.

BTW, the MMs are not also trading for themselves - because that would be violation of Volcker rule. I'm using MMs loosely above.

Volcker Rule - Wikipedia

 

[Wnuk]

No, it was $335 but another web site said $325, but cannot get to website as it’s acting “funky”

So the Max Pain site shows $335 but that is for next Friday the 4th. For some reason they don’t show anything for this Friday the 28th.

 

[EVNow]

I don't think Congress even entertained it because Obama was President. Did a bill killing the EV credit ever make it out of committee back then? Not sure.

This is what I keep saying - there was enough opposition within Republican caucus to allow any such bills. TN senators (esp. Lamar Alexander, who is also an enthusiastic plugin proponent) would not allow it.

Alexander even got his Prius converted in 2008 !

https://www.usnews.com/news/blogs/w...lamar-alexander-buzzes-about-his-electric-car

 

[sundaymorning]

Is 1,000 points really the largest record in stock market history?

Dow rallies 1,000 points, logging its biggest single-day point gain ever

 

[EVNow]

Is 1,000 points really the largest record in stock market history?

Dow rallies 1,000 points, logging its biggest single-day point gain ever

Not sure - but could be. As the index goes higher, point increases (rather than %) get higher and higher, so it becomes easier to set such records.

Its like how we always have the presidential candidates get highest number of votes ever ! Trump got more votes than FDR !!

 

[printf42]

Is 1,000 points really the largest record in stock market history?

Dow rallies 1,000 points, logging its biggest single-day point gain ever

How they are wording it shows it’s not the largest percentage gain ever, but they really want it to sound impressive.

 

[kyzhk]

Why not ? There are a lot of senators from states where the companies will want the tax credit - like NV & TN. This is the reason it has not got killed all these years.

My hope is instead of blindly extending the credit - they should make it a common pool of 2 Million vehicles instead of 200k pools for each OEM. That was a dumb thing to start with - which only helped late comers (Toyota, Honda, FiatChrysler, Merc) and punished early risk takers (GM, Tesla and Nissan).

yeah do you know what the condition of the credit is? Does the credit have an expiration clause?

Would a new comer today enjoy the same benefits? Just start bunch of car companies making a limited amount of token EVs to qualify as a "car company" and sit on the tax credit until EV becomes a commodity then sell the business for all of the potential $7500 + long tail credits.

Thats a rather stupid ev tax credit implementation, really - they are incentivizing car company to sit on the credit until EV can be made cheaply enough.

 

[dougmang]

Sell the fecking Mustang...

That's what I thought, keep my mercedes for fun driving, Tesla for daily driving. It didn't last long.

We'll see, I've already put a lot of money in aftermarket parts for it and enjoy wrenching on it in the garage, but yeah, it could go someday. One thing is for sure, the focus (my daily) would be the first victim.

Anyway, nice rally today at the end. I honestly was expecting it to test 29x some more and maybe end there or above 3 by a little. It still sucks it broke and held below 3 (even though I got a buy in) because I really don't know what the bottom is once it's around there. But it doesn't scare me, I'm long anyway and happy with my position. Here's hoping for great q4 results, and macro's not messing things up. If we can get that then I'm excited to ride that tsla gravy train.

 

[EVNow]

yeah do you know what the condition of the credit is? Does the credit have an expiration clause?

Would a new comer today enjoy the same benefits? Just start bunch of car companies making a limited amount of token EVs to qualify as a "car company" and sit on the tax credit until EV becomes a commodity then sell the business for all of the potential $7500 + long tail credits.

I don't think there is any expiration year. But since Congress can always revisit - expect it to be expired once most of the companies have exhausted their limit - even if not in the next few months.

Thats a rather stupid ev tax credit implementation, really - they are incentivizing car company to sit on the credit until EV can be made cheaply enough.

Yes - it is bad for early risk takers and good for the laggards, as I wrote. I believe this was done to placate Senators representing Toyota. What you think of as "stupid" is really just proof of how lobbying corrupts Washington.​

 

[brian45011]

Note that Tesla is spending on marketing: the referral program costs several tens of millions of dollars per quarter.

Where does this expense show up on an Operating Statement?

 

[Drax7]

“
That article is such blatant propaganda for the regressive types. Congress didn't pass a law to give a credit to Tesla. That borders on an outright lie. The odd part are the conservative Tesla owners who pretend that this attitude isn't real. I'm glad you guys are on team Tesla, but let's not pretend that a majority of conservatives are anti anything green/EV related.[/QUOTE]


condescending liberal thinking you are morally superior, but you don’t live by the ramifications
Of your own ideology

 

[Fact Checking]

Where does this expense show up on an Operating Statement?

The 2017 10-K lists it as:

"Marketing, Promotional and Advertising Costs

Marketing, promotional and advertising costs are expensed as incurred and are included as an element of selling, general and administrative expense in the consolidated statement of operations. We incurred marketing, promotional and advertising costs of $66.5 million, $48.0 million and $58.3 million in the years ended December 31, 2017, 2016 and 2015, respectively."​

With about 100k deliveries that's about $665 per unit. I am assuming that the bulk of this cost is the referral program.

 

[SOULPEDL]

Saying the same thing. If true, MARGINS ARE REALLY GOOD!
We are seeing the same things here, we won't know for sure until the New Year.
Prediction - extending as a sale something like "If Congress Doesn't, I will - Rebates Good for 1 More Quarter."
Do not sell until $425.

On the guaranteed rebate topic, new conclusion... I'm an impulse buyer and go for the good deal. IMO, he's flushing out people like me. If I didn't own one already, I'd buy right now because it would eat at me. Wait until Q1 and the story would be "I should have bought last quarter" and then the sale maybe lost entirely and I'd wait for the $35K. With >20% GM, he's still smart to get every last "capable" buyer on the Christmas Sale, AND the New Year Sale. In the end, he gets more of my money making every sale count at maximum profit. No competition so people will wait and he knows it.

Tesla will subsidize the $3,750 tax credit for the next 6 months, I’m sure of it. Production ramping up means they have more than enough margin to pull it off. At the very least all vehicles will get $2k reduction in price in January

 

[kbM3]

Do you think Tesla has some kind of religious aversion to TV commercials?

Of course they don't. They'll run commercials just like every other auto manufacturer if and when they need them to drive ongoing demand. The fact that there is no indication they are planning to run commercials is an extremely bullish sign that demand is too high to justify it.

But then, should Tesla show this on TV, I believe it would be the talk of the town:

I think these one off ads are good for brand promotion.

But ofcourse, the day the information about the ad comes out TSLA will tank by $20 - because the "demand has collapsed".

You advertise to create demand. Tesla doesn't have a demand problem. Nothing normalizes more than seeing friends, family, and neighbors using something in the real world. When Tesla needs to advertise, if ever, then they will. Now is not the time.

Elon has said something to the effect that he believes advertising is fundamentally dishonest.

 

[anthonyj]

Saying the same thing. If true, MARGINS ARE REALLY GOOD!
We are seeing the same things here, we won't know for sure until the New Year.
Prediction - extending as a sale something like "If Congress Doesn't, I will - Rebates Good 4 More Quarter."
Do not sell until $425.

Exactly. No point in announcing it now. They want to squeeze every last sale. Similar to the unlimited lifetime supercharger last quarter, they kept extending it

 

[keydiver]

Sure it does as margins improve they can. Of course at that point just a price cut but good publicity

I think price cuts right now would be a bad idea, as it just plays into the short's "lack of demand" story. I also don't see much chance of Tesla eating $3750 on every Model 3 for the next 6 months, especially when not everyone would qualify for $7500. Right now at Tesla money=survival and growth, so I don't see them burning millions just for good will.

 

[anthonyj]

I think price cuts right now would be a bad idea, as it just plays into the short's "lack of demand" story. I also don't see much chance of Tesla eating $3750 on every Model 3 for the next 6 months, especially when not everyone would qualify for $7500. Right now at Tesla money=survival and growth, so I don't see them burning millions just for good will.

It’s not burning millions for good will. It’s keeping production absurdly high which has the added effect of increased margins. Great for the long run

 

[JRP3]

condescending liberal thinking you are morally superior, but you don’t live by the ramifications
Of your own ideology

I gave you a disagree but I'm not really sure what you are saying

 

[JRP3]

It’s not burning millions for good will. It’s keeping production absurdly high which has the added effect of increased margins. Great for the long run

What makes you think they need to discount cars to keep production at maximum rates? No evidence suggests such.

 

[keydiver]

I have a feeling that between Model 3 orders in the US, Canada, China, and Europe, Tesla will be supply constrained for well past the next 6 months, so no need for discounts.