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TSLA Market Action: 2018 Investor Roundtable

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Very OT, but as mentioned, went to the launch of the i-Pace today. For sure it’s a nice car, but much smaller then you’d imagine given the external size - about the same as my wife's C-Max I reckon.

Nicely finished as you’d expect from Jaguar, superb seats, lots of brushed aluminium and chrome in the interior. And I’m sure I’ve seen door-handles like that somewhere before.

Summary: shiny but tiny...

We all know about the silly wallet sized frunk, but is there really no more trunk space below what is shown? Model 3 would look similar but then has a big cave you can see when you pull up the lid for more luggage.
 
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Thanks for the pix and comments. I have a Model 3 on order, but it's been delayed so long I am considering switching to the Jaguar.

I'm interested in your impression about the interior size. Externally, we know it's nearly identical in footprint to the Tesla Model 3, though somewhat taller than the 3. I'd expect the interior therefore to be also similar to Model 3, though more cluttered as you say than the 3's more open interior design. Do you feel it's smaller than a Model 3 inside? Or same size with some of the open space used up by consoles and storage and such?

Back on topic after this...

Wait, for the price of the i-pace you can order a P3D, which is not delayed much at all. In fact my neighbor, who test drove my Model 3 in maybe March and was blown away by the performance and modernness, put in a reservation a week later and already got called to configure his P3D with the promise of taking deliver in july or august.

He may have used the trick to buy something in the store (charger in his case) ahead of time in order to not appear as a first-time-buyer, not sure if that is actually making a difference, but he needed it anyways and the rumor was going around.

The P3D will blow the i-pace out of the water, has proper supercharging, autopilot with the promise of fully selfdriving features being around the corner, and all the other cool things tesla. Its a no-contest really isnt it?
 
*And I know that some tooling is depreciated per unit produced, but some is not, it's depreciated over time, hence margin pressure at the very begging of using new capex...

As of December 31, 2017, the estimated productive life for Model S and X tooling was 250,000 vehicles based on our current estimates of production. As of December 31, 2017, the estimated productive life for Model 3 tooling was 1,000,000 vehicles based on our current estimates of production.

Mod: thanks for a useful contribution. When quoting something one should say where it's quoted from, either a link or "From Tesla's 2018 10-K" or whatever. --ggr.
 
As of December 31, 2017, the estimated productive life for Model S and X tooling was 250,000 vehicles based on our current estimates of production. As of December 31, 2017, the estimated productive life for Model 3 tooling was 1,000,000 vehicles based on our current estimates of production.

Mod: thanks for a useful contribution. When quoting something one should say where it's quoted from, either a link or "From Tesla's 2018 10-K" or whatever. --ggr.
Apologies - from 10k
 
Range is a number that quantifies how far your electric car can go.

Used in a sentence:

"I have seventy-five miles of range! Golly!"

(Sorry, I probably had one too many chocolate milks just now. I kid, I kid).

It's also a big wide open space in the west of the United States where people used to put homes... Deer and Antelope used to hang out there too.

And per Google the range of the I-Pace is 240 miles. I have serious doubts that it does over the air upgrades.
 
We'll see 10k when the Model Y starts production in my opinion. Or a Chinese factory is up and running. Whichever is first. End 2019?

There's enough demand for Model 3 to head for 10K, and they've got enough of the subassembly lines set up for 10K, they're going to aim for 10K. They want to clear that backlog as fast as possible so that people aren't discouraged by the "two year wait time" (this would get it down to *one* year). I don't know when they'll get there exactly but they have strong motivation to do so as quickly as possible.
 
Not sure who you're discussing this with, but we'll be lucky to see 7.5K by the end of the year. Remember, Tesla basically abandoned any guidance for 10K, and was very fuzzy 'wait and see' last time this question was asked (in CC I think)

My speculations is that they'll go very lightweight on capex and we'll see only 6K, maybe 6.5K, whatever they can squeeze out of existing lines. This is a pure speculation; if they have more money or easy access to capital through additional credit lines, I'll be probably wrong, as they'll spend more and get further...
Well, Q3 is looking tight, so they will probably not expend big capex in Q3, but Q4 is really looking like a safe source of profit (I trust luvb2b's model) and that's probably enough to start duplicating the bits which need to be duplicated. I bet they try to speed up the body line rather than duplicating it, but I think they'll duplicate other bottlenecks.

However, another disadvantage of additional large capex (only when it's put in use!) is that it would pressure margins again, and I feel @neroden is right with speculation that Tesla will want to be added to S&P500 ASAP, for which it needs Q3, Q4, and Q1/'19 to be profitable, and overall Q2+Q3+Q4+Q1/'19 > 0, i.e. profit from the last three quarters should be greater than loss in Q2. And loss in Q2 is going to be gigantic.
Some estimates are that it's going to be in line with the loss in Q1, only a little worse. Cash flow shuld be a lot worse, but GAAP profit/loss...
 
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I've been thinking about this since Brian raised it a few months ago. Of course, if the conversion rate is anywhere below the relevant option-set price the people will convert However, there are a number of complications for the board:

1 A capital raise by this method is still a capital raise - it will show that Musk was wrong when he said no capital needed or wanted;
2 While the larger players will know about and expect this, a number of mid-level investors will not and will be negatively surprised by the dilution;
3 This will cause strong demand for puts and therefore may increase shorting - so leading the board to want to price the conversion lower; and
4 While a lot of converts have this feature it's rarely used - I think it would be seen as a sign of financial distress.

So, all in all, it's not quite as simple as it sounds.

To pile on to what ggr said: who cares? The point is that Tesla cannot have a liquidity crisis any time soon, and Musk now knows this. It doesn't matter what Wall Street "thinks". The numbers indicate that Tesla will have enough cash to get through to March 1. Tesla may have enough cash to pay off the convertibles, or they may have to issue stock, but they will definitely be able to issue stock unless the short-sellers drive the price below $252 -- which seems *exceedingly* unlikely after two quarters of profit. (And if it happens I'll be among many who will pile on to buy as much stock as possible.) Tesla will have enough profit to pay off the November 2019 bonds. And after that Tesla never needs to go to the capital markets again.

The short-sellers may have prevented Tesla from expanding as fast as Tesla wanted to, but they can't cause a liquidity crisis. So that's the end of that scheme. That's the point
 
Since the pattern is so obvious, why don't longs make money off of them? It seems to be easy: Sell as soon as the number of twitter posts by bears rises above x/hr and journalists publish more than 1 negative article in a day, sell, wait, buy. 15% profit/week.

Hasn't Hogfighter been trading based on the Hog Negativity Index using essentially this method?
 
It may be wishful thinking, but what about if he knows about either a criminal complaint or a lawsuit against Chanos for market manipulation - would that count as material, non-public information?

Maybe. If the information was *public* then it would certainly not count. Often such information is public, just not noticed by most people.
 
And whaddayaknow - a positive Tweet from Dana Hull!

Dana Hull on Twitter

Wait, does this mean I Called It On Peak FUD?!?

I mean, of course she did. We have passed Peak FUD, as I pointed out. Now when they push so hard, it’ll look ridiculous because of their eyes bugging out.

We might not need to crowdfund commissioning Greg Palast to follow the Koch FUDbucks after all...
 
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According to Cramer “longs are unshakable.”

This is why shorts are getting killed, their leader (Chanos) doesn’t produce any goods, whereas Tesla is manufacturing the best car in the world. The Model 3 at 5,000/week will own up to 30-40% of the mid-size luxury market share. This is huge considering how big the automobile market is.
 
According to Cramer “longs are unshakable.”

This is why shorts are getting killed, their leader (Chanos) doesn’t produce any goods, whereas Tesla is manufacturing the best car in the world. The Model 3 at 5,000/week will own up to 30-40% of the mid-size luxury market share. This is huge considering how big the automobile market is.
Shorts have been killing us longs for over a year now. That's how long TSLA has been trading sideways with wild peaks and valleys. The only people making money are the swing traders and they have made a mint. Meanwhile the longs (and shorts) are wondering when the wild ride will end.
 
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