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Krugerrand
Meow
Let this be a lesson to those who said CR wouldn’t retest the car - wait a few hours next time.
Thanks for posting this -- very helpful.
One issue to consider: a significant number of LR RWDs will be delivered by the end of Q2, and the ramp of AWD/P will probably take some time so the disproportionate production of LR RWDs will probably continue well into Q3. So Tesla may want to produce a higher percentage of AWD/Ps in late Q3, Q4 and potentially early 2019 to try to get them to folks who have been patiently waiting. In other words, to catch up with LR deliveries so that new P/AWD orders in North America can be delivered on the same schedule as LR RWD or even prioritized.
To look at it from another angle, Tesla is estimating 6-9 months to delivery for new AWD/P reservations, which implies they intend to get through all existing North American reservationists who are ready to configure AWD/P by Dec. 18- Feb.19. Even assuming not every reservationist will be ready to order in that time frame, it seems to imply a disproportionate percentage of Dual Motors/AWD production relative to LR RWD in 2H 2019 (assuming Tesla is able to ramp AWD/P production quickly enough). If so, that could generate a significant amount of additional cash and profits, and also offset SR sales if Tesla is ready to start producing them.
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bdy0627
Active Member
I don't understand what you said there. We are talking about Consumer Reports and whether or not they conspired to release the report so as to influence the stock movement at a certain time. Again, I have a hard time believing they are tracking Tesla's stock closely and trying to influence it by the timing of their reports. I think no matter when it was released, someone would complain it was perfect timing to cause the stock to do something.
bdy0627
Active Member
Menifeer
Member
As long as people are willing to buy the upgrade options on which it makes higher margins, Tesla has no financial incentive to offer the $35k version.
Once they make enough cars per week they have two incentives: 1) positive cash flow contribution 2) advertise electric car driving to more people by getting the entry level on the street, which may soon after not only result in deferred option purchases (activating autopilot because everybody who has it is raving about it) but also your neighbor realizing they want the fully optioned out version of the same thing.
tinm
2020 Model S LR+ Owner
davecolene0606
Member
Hokey Smokes Batman... no TPS cover sheet?
Gonna need yah to meet with the Bobs...
And ummm yehhh, I’m gonna need you come in this weekend.....
Fire Away!
The $35k version is just putting the RWD SR battery on sale. Even with this configuration I suspect there will be a lot of pickup on $1k color, PUP and Autopilot. Also potential for Tesla to add upgraded audio as a $1500 package separate from PUP or glass roof for $1500.
No difference than any other car, few people actually want the total base car w/o options.
No difference than any other car, few people actually want the total base car w/o options.
We’re not quite there, yet.
[Emphasis mine]
So there’s an IF and they would be willing to retest the same car.
When the less than expected braking performance is e.g. due to glazing of disc pads, no retest is promised. Just like testing any other, modified or not, car.
jhm
Well-Known Member
Exactly.
On a list of 450k reservation holders, they can give prior to alot of higher value Model 3 configuration. Notice they are even encouraging new reservations to get D and P in 6 to 9 months, potentially ahead of old reservation holders waiting on SR. This is not so happy for those waiting for a more affordable Tesla, but Tesla has always given priority to the higher value orders. The business reality is Tesla has always needed to get the higher cash flow sales first.
sundaymorning
Active Member
TrendTrader007
Active Member
$TSLA SP currently testing long term trend line going back to feb and dec 2016 patience is required longs next move up likely to take SP well over $500 and likely to start over the next few days to weeks current SP is unsustainable and a violent upward counter move likely coming
I have a really hard time seeing how the stock is not going to rebound from this area
I have a really hard time seeing how the stock is not going to rebound from this area
Regarding the plain $35,000 Model 3, it is being handled much like the Model S 40, which I ordered back in 2012 and received a year and a half later in 2013. Tesla was in no hurry to release this vehicle because such a small number were ordered it didn't even make sense to design a 40kwh battery (a software-limited 60kwh battery was used instead). For Tesla, the difference between the two vehicles is that the S 40 would never be profitable once the battery decision was made, but the SR Model 3 will be profitable, once economies of scale are achieved. Although the wait was a year longer than if I had ordered an S 85, my S 40 eventually was delivered to Honolulu and it turned out to be a fantastic car for driving around my island. Two years and 40,000 miles later, I sold the 40 for only $8,000 less than what it cost to buy (after taking into account my $7,500 tax credit). I suspect the SR M3 buyers will be very much like me, impatient to the point where quite a few decide to upgrade to something that will be delivered quicker, but rewarding for those who wait it out. If someone buys a $35,000 Model 3, adds autopilot, and manages even half the U.S. tax credit, I suspect they too will be able to drive the vehicle for two years and then sell it for less than an $8,000 loss. The big question is why would they ever sell it? I was upgrading to a Model S 75D with autopilot and supercharging (not available on the 40kwh version), so I really gained quite a bit with the upgrade, but most of the $35,000 M3 owners will likely hold their vehicles for a long, long time and be quite satisfied with the value.
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The so called "brake issue" made me smile as its for me a proof of claim that Tesla can fix issues faster and quicker with less costs than anybody out there. I don't have doubts that they will prove the car to be best in class with break testing soon.
This kind of stories that make some uncertain stock owners get more nervous and sell combined with a lot of negative press and shorts starting their daily work is the environment and sentiment I am looking for. Added today again some and will keep them for many years. This shares beside all other I own are gone and out of the market for the long run....
This kind of stories that make some uncertain stock owners get more nervous and sell combined with a lot of negative press and shorts starting their daily work is the environment and sentiment I am looking for. Added today again some and will keep them for many years. This shares beside all other I own are gone and out of the market for the long run....
JRP3
Hyperactive Member
Your track record has proven you have no vision at all regarding TSLA stock price. I can't believe you have the nerve to start your nonsense all over again.
jhm
Well-Known Member
The condition at the top is the key issue. One $70k M3 easily generates more cash than two M3 at $35k. So as long as production rate is limited, making a $35k car instead of a $70k opportunity would have a negative contribution to cash flow from an opportunity point of view.
Additionally, the rate of production does impact the actual coat of the vehicle. For example as the rate double from 2500/wk to 5000/wk, the total labor used will not double. Suppose it goes up by say 20%. Thus labor per vehicle drops 40% as production rate doubles. So at a low production rate, the labor cost per vehicle could be prohibitive on a $35k vehicle, but as the rate goes up the labor cost per vehicle drops and the $35k car become profitable to make. I believe this is the basic point that Musk tweeted. Tesla simply has to work its way up to a high enough production rate that the full line becomes profitable.
What is that critical production rate? Judging by comments from Musk, I think that 5k/wk is sufficient. Specifically, we are guided to 5k/wk by end of Q2 with profitability and positive cash to follow in Q3.
sundaymorning
Active Member
Well this is good, I hunk there’s some credibility to Elon stating 30-40% market share by end of year in the US:
Tesla Model 3 sales beat BMW 3-Series and Mercedes C-Class during first quarter in California, says report
We’re already at 14% if the market share in California during the 1st Q when averaging 800/ week, now imagine 5,000/ week where will Tesla be?
Tesla Model 3 sales beat BMW 3-Series and Mercedes C-Class during first quarter in California, says report
We’re already at 14% if the market share in California during the 1st Q when averaging 800/ week, now imagine 5,000/ week where will Tesla be?
sundaymorning
Active Member
$145 from here is about $420, a good number to smoke the shorts if you know what I mean.
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