TSLA Market Action: 2018 Investor Roundtable

[davecolene0606]

There have been a few reports such as Youyou's that claim the AP made a sudden sharp swerve. I've never experienced that in two years with AP1 (perhaps 14k miles on AP). If it is capable of that then having hands on the wheel would be important.

My experience has been that nearly any resistance from the drivers hands being on the wheel will disengage AP when it tries something you wouldn’t want it to do.

Fire Away

 

[jhm]

It is Tesla's problem because people are crashing their cars. Not only does that lead to "Tesla's Autopilot is unsafe" but to "Tesla's are unsafe" So there is an enormous risk that the brand is being damaged to a very large degree. Even if they are inferior: How many crashes can you list while using Cadillacs Supercruise? How many that have happened with other Level 2-3 Systems? Exactly.
To be honest, I think People crashing in Teslas is one of the biggest issues there is and Tesla very urgently needs to do something about it.

Yesterday, I saw a non-Tesla that had veered off the surface to collide with a tree. I doubt the incident made even local news. This sort of solo accident into stationary objects at the hands of human drivers happen all the time. It only makes national news when a Tesla is involved. This sort of reporting bias decontextualizes the risk in a way that makes the problem appear much more serious for Tesla than it is.

So this is a real PR problem for Tesla. They do need to address it with better engineering and software. But ultimately resolution of this comes when the media finds that no one cares to read a "Tesla hits something" story. The novelty must wear off. Perhaps some day the novel headline of thr day will read, "Human driver overrides Autopilot, smashes into tree." Shocking, I say!

 

[rameshbende]

Thanks. How much of the production/delivery difference is delivery processing and how much is intentional hold-back relating to the tax credit?

Hold back largely will be due to delivery processing time.So almost all the cars manufactured in last 3 weeks of June will not be delivered. They will do some hold back to not exceed 200k. They have already guided S/X will also be in range of 22K for quarter which is again to manage 200K mark and then going for kitchen and sink in Q3-Q4 to achieve profitability.
I expect S/X deliveries between 10-11K and Model 3 between 12-14K for Q2 in US.

 

[Tslynk67]

There have been a few reports such as Youyou's that claim the AP made a sudden sharp swerve. I've never experienced that in two years with AP1 (perhaps 14k miles on AP). If it is capable of that then having hands on the wheel would be important.

First time I tried to use AP(2) on a highway at 120kmph, it did an unexpected "swerve" within the first 30 seconds, which frightened the life out of me. This may have been caused by driving into a low morning sun on a wet road, with a lot of reflection and glare. It wasn't a problem though and didn't become a "swerve", because I had my hands on the wheel and I instinctively reacted immediately, and auto-steer disengaged. Had I been texting, or had climbed into the rear-seats for a YouTube video, then maybe it could have caused an accident, but I'm not a ******* idiot. L5 before we can do that.

I'm also yet to hear of an accident caused by AP, i.e. even though the driver was attentive, with hands on wheel, the car caused a crash. every single case appears to have been caused by driver negligence or stupidity.

 

[jhm]

Fatigue is huge here. Lost my Wife to a guy who hadn’t slept for the previous 23 hours.

Oh, so sorry for your loss.

For some, safer fully autonomous vehicles won't come soon enough.

 

[bambam4171]

Even if Munro is right and the cost is 38k. Average price is now I think 56k, right? so 18k per car would go to Tesla, no dealership, no rebates. So 500x18k=9m per day if they don't make any progress. The aim is to triple this though. So lets say in Q3 and Q4 the average 800/day then is is already 2 BEEELION Dollars. Which part of my math is off? (of course setting aside selling cost and the like)

 

[larmor]

GM on CNBC regarding softbank investment in self driving cars-> they showed an inning of softball

 

[ValueAnalyst]

General Motors shares soar as SoftBank invests $2.25 billion in automaker's self-driving vehicles

SoftBank's $2.25B for 19.5% equity values Cruise Automation, for which GM paid $1B, at $11.5B for minority stake, or ~$15B for control.

15x return on investment in two years is likely why GM jumped by 10% premarket upon SoftBank news.

 

[bdy0627]

This recent dip into the 270s felt a lot like the Spiegel Bottom to me - like a last gasp of negativity. I think the last two days were just the beginning of a very big move. I think a lot of the shorts added in the last month were just hoping for a quick bankruptcy, and will start covering Friday when the Insideevs report makes it clear that isn't going to happen. People thinking they can wait until 5k/wk is confirmed will miss out on a huge move in my opinion.

Edit: I also think the upcoming annual shareholder meeting is an underrated catalyst. Musk will have full control of the narrative - no analyst questions. He'll make everything sound extremely positive, and there could even be product/deal announcements.

I certainly hope you are right. We will soon see. Anyone on the sidelines waiting for higher production of the model 3 who exited in the low $300s has no reason to question their approach at this point. The point where sideliners need to be careful is when TSLA runs decisively up above $312. Until then, we are range bound for now. At that point, the stock definitely could run right up to $350+ in short order. If you don't want to deal with this range trading, that's the safest point to jump back in. TSLA has pushed $312+ a few weeks ago and failed to hold it, so it needs to hold it.

 

[Zaxxon]

This is hardly a topic for market action thread

Thanks for your concern. This thread's title is often tongue-in-cheek, especially outside market hours.

but since you and @TNEVol brought it up, there is indeed a technique to holding the steering wheel on autopilot so the system “knows” you are holding the wheel. Rest your hand(s) at 3 and 9 and relax your arm: done properly this will put at least 1lb of force on the wheel, unless of course you have stick arms. A lot of people drive at 6 o’clock position because it is a more restful position, autopilot will have no clue you have a hand on the wheel in this position.

I'm aware. Maybe I wasn't clear. This technique doesn't work on the 3 some of the time. No technique does, as I'm pointing out that the only level of torque able to satisfy the system that I'm hands-on also overrides the system, disengaging Autopilot. It's a software bug or an issue with the torque-measuring hardware.

As to your other point about Tesla claiming where your hands are in an accident, although it could be accurate would only most likely be the result of you being involved in an accident where your negligence appears obvious. Bottom line: don’t smash into walls/medians, stopped cars, or drive off roads. This should all be possible by paying attention and being ready to take over.

One would hope.

 

[kbM3]

So this is a real PR problem for Tesla. They do need to address it with better engineering and software. But ultimately resolution of this comes when the media finds that no one cares to read a "Tesla hits something" story. The novelty must wear off. Perhaps some day the novel headline of thr day will read, "Human driver overrides Autopilot, smashes into tree." Shocking, I say!

Yes the novelty will wear off, but the true question is how much damage it will have done to the public perception of Tesla safety, and how many years of safety statistics will it take to overcome that.

 

[bdy0627]

Yes the novelty will wear off, but the true question is how much damage it will have done to the public perception of Tesla safety, and how many years of safety statistics will it take to overcome that.

This is my concern as well. Public perception of Tesla has definitely shifted over the last couple of years due to media coverage of crashes. That will almost certainly get worse over the next year as hundreds of thousands of model 3s are handed over to new drivers, eager to use Autopilot. I actually expect the accident rate to get worse as non-enthusiasts start driving Teslas. I really really hope they make some significant progress with the technology soon.

 

[Irishjugg]

That's a very interesting question! Implied volatility should shoot through the roof, raising all option prices. Market makers would stop wanting to open positions until things settled down, reducing volume and blowing out the spread. They would also be desperately trying to close and hedge their exposed positions, which would have a more subtle and nonobvious effect. Where they've written puts, they're gaining, but where they've written uncovered calls they're in huge trouble, so they'd probably be buying calls or stock, exaggerating the short squeeze. For me as a writer of puts, I just need to make sure the price increase due to the jump in volatility doesn't exceed the price decrease due to the change in stock price by so much that I get margin called; this should be easy as far-from-the-money options generally have pretty low value.

Actually, a lot of this is incorrect .
Market makers almost what's trade roughly Delta neutral. We make our money on trading volatility.

Spreads will certainly increase, but market makers will be trying to get long vol if they aren't already at that tube, so they will be buying ATM options . Calls and puts are equivalent in terms of vol, so they will be buying each as much as they can ATM. any market maker that tries to stop opening positions until things calm down is awful at what they do.

Market makers make a significant portion of their profits when vol spikes. For instance this February when *sugar* hit the fan I know of 2 firms specifically that made more in those 2 days than the entire previous year.

Market makers don't have unhedged/exposed positions at least in terms of Delta. Any firm short vol will be racing to buy vol to avoid hitting risk limits.

Now they will also need to be balancing things like gamma and skew, so I can't predict what type of buying or selling activity will happen in the wings, that will be up to their current exposure and the way the smile curve is changing. They will generally just try to keep things in line with the curve and flatten out wing risks.

 

[Irishjugg]

This recent dip into the 270s felt a lot like the Spiegel Bottom to me - like a last gasp of negativity. I think the last two days were just the beginning of a very big move. I think a lot of the shorts added in the last month were just hoping for a quick bankruptcy, and will start covering Friday when the Insideevs report makes it clear that isn't going to happen. People thinking they can wait until 5k/wk is confirmed will miss out on a huge move in my opinion.

Edit: I also think the upcoming annual shareholder meeting is an underrated catalyst. Musk will have full control of the narrative - no analyst questions. He'll make everything sound extremely positive, and there could even be product/deal announcements.

If Tesla does prioritize non US deliveries for the rest of this quarter, maybe inside EVs numbers (showing a massive decline in US #s) may present a quick buying opportunity?

 

[Krugerrand]

It is Tesla's problem because people are crashing their cars.

So it’s Honda’s fault every time someone crashes a Civic when not paying attention or otherwise using the car in a way Honda never intended it to be used, nor advertised it should be used?

Simply, the thought process is ridiculous, absurd, illogical, out-to-lunch and typical of those who abhor taking personal responsibility. And quite frankly exhaustingly exacerbating.

Not only does that lead to "Tesla's Autopilot is unsafe" but to "Tesla's are unsafe" So there is an enormous risk that the brand is being damaged to a very large degree. Even if they are inferior: How many crashes can you list while using Cadillacs Supercruise? How many that have happened with other Level 2-3 Systems? Exactly.

Not relevant what I can or can not list.

Risk to the brand? Overstated, imo. There will always be people who unequivocally believe the media reports, who are lazy and don’t care to do their own research, who hate just because that’s what’s in their hearts and minds, who are afraid of change and stuck in their old ways, who whatever. They’ll come around in time or they won’t. Tesla doesn’t need them. There are enough of the other flavor of people (and the list grows daily) and the product is more than good enough to see the mission through to the end.

Secondarily, the brand is already too strong and that strength is exactly why the attempt to discredit it has reached this fevered pitch. It’s too late. The idea of Tesla is already too big to be stopped. The snowball has long since been on its trip down the mountainside

To be honest, I think People crashing in Teslas is one of the biggest issues there is and Tesla very urgently needs to do something about it.

Nah. The biggest issue is Tesla not being able to produce cars fast enough.

 

[kbM3]

Risk to the brand? Overstated, imo. There will always be people who unequivocally believe the media reports, who are lazy and don’t care to do their own research, who hate just because that’s what’s in their hearts and minds, who are afraid of change and stuck in their old ways, who whatever. They’ll come around in time or they won’t. Tesla doesn’t need them. There are enough of the other flavor of people (and the list grows daily) and the product is more than good enough to see the mission through to the end.

Secondarily, the brand is already too strong and that strength is exactly why the attempt to discredit it has reached this fevered pitch. It’s too late. The idea of Tesla is already too big to be stopped. The snowball has long since been on its trip down the mountainside



Nah. The biggest issue is Tesla not being able to produce cars fast enough.

I agree with this position, but I hate the fact that the negative publicity puts ANY dent in demand.

 

[Tslynk67]

So, we have this: UBS: Sell Tesla shares because carmaker will need to raise capital in the fourth quarter or earlier

Nota bene: the same guy issue a sell advice and $140 price target in February 2016 (where's the ROFLOL emoji when you need it?): Tesla Motors, Inc. (NASDAQ:TSLA) - UBS Still Selling Tesla, Thinks Cash Flow Guide Seems Misleading

To be fair, his over-all record isn't so bad, I guess he just doesn't understand Tesla very well

 

[K_Dizzle]

Volume looks very high right out of the gate

 

[Krugerrand]

Thing is that it does not matter if they crash at a similar rate as average. Because Tesla is high profile every crash makes international news, no kidding. The idiot that hit the cop car yesterday made headline on many swiss outlets. So the understanding of average Joe is: Teslas are really unsafe, you know they really crash all the times.

I’m an average Joe and I don’t believe Teslas are unsafe. I actually know it to be contrary based on agency safety ratings and having driven them.

*You* are being overly dramatic and emotional on the subject as are those other people who believe false safety narratives about Teslas without bothering to do one ounce of due diligence.

The reality is that you can’t change people. They have to want to change, to be better, to be open to change, et al. Focussing the effort on them is wasted resources.

People who drive distracted in a Tesla on AP were already distracted drivers before Tesla and AP. Using AP as an excuse to become more distracted is a reflection of them not Tesla. Ie., Mr. Xue. Regardless of what the media says or some people believe.

I’m confident that Tesla will continue to put customer safety first, and continue to develop AP until such time as we can all sleep in our cars on the way to the Inlaws.

I’m also confident that people will continue to place blame anywhere than upon their own shoulders, continue to believe media reports, and just generally suck at being human.

Lastly I’m confident *we* win because ‘we don’t ever give up’.

Please take a deep breath, continue to support Tesla, and correct misinformation among your circle of humans. This too shall pass.

 

[defc0n]

General Motors shares soar as SoftBank invests $2.25 billion in automaker's self-driving vehicles

SoftBank's $2.25B for 19.5% equity values Cruise Automation, for which GM paid $1B, at $11.5B for minority stake, or ~$15B for control.

15x return on investment in two years is likely why GM jumped by 10% premarket upon SoftBank news.

Where are you getting $15B from? This means we've seen Mobileye valued at ~ $15B and now Cruise Automation valued at $11.5B?