TSLA Market Action: 2018 Investor Roundtable

[avoigt]

I'd be shocked if cell/module/pack production was not in GF3 per shareholders (Q1?) call and lack of excess Tesla production at GF1. No sense shipping/ installing the machinery to somewhere else just to ship the cells to China.

Musk also recently stated that all future Gigafactories will produce both battery cells and complete electric vehicles for a fully integrated manufacturing facility.

 

[brantse]

The premarket run up (+9). Is it similar to last week when we had the short attack ?

IE the size and pattern of buys ?

I don't know about the last time, but there's some big blocks being purchased. I noticed one of 6,900 shares.

 

[Tslynk67]

I'd be shocked if cell/module/pack production was not in GF3 per shareholders (Q1?) call and lack of excess Tesla production at GF1. No sense shipping/ installing the machinery to somewhere else just to ship the cells to China.

Agreed - after all, isn't it all about vertical integration?

 

[sweter]

No, no. Hold it right there.

InsideEVs slapped a click-bait title on their article. If you delve further into it, you’ll see that the 455 is a raw dyno result that doesn’t take aerodynamic drag into account. They’re actually pointing out that the dual motor configurations have less range *in this particular test* than the single motor configuration (455 miles vs 495 miles). Full EPA test results have not been published yet, so reacting to this in any way is premature.

Taking a lesson from shorts, huh? But using it to spread good!

 

[gora321]

Premarket looking strong green in Europe

 

[neroden]

Yes, I'm up about 124%. Bought 355 July puts that were out of the money (and now solidly in the money).

Congratulations: that's good timing on your short-term trade. Nothing to do with fundamentals, of course, but I always admire successful market timing. I had all the information to do it, but didn't want to bet money on market timing.

 

[neroden]

Seeing if I should go for the TSLAQ play. I'm waiting for someone to convince me that the Twitter Shorts are spreading FUD, not facts.

Firebird, do your own research. We're not going to do your homework for you. Yes, the Twitter shorts are spreading FUD, not facts. You don't need "someone to convince you", you need to do your homework and actually find the facts. Like I have done. Read all the footnotes in all the corporate documents, scour the Internet for the lectures revealing technical details, the actions of all the other carmakers in the world, etc. Drive the cars and figure out what other owners think.

But sadly no one wants to discuss a critical perspective.

No, we'd love to discuss a critical perspective, we just don't want to deal with nonsense which we debunked literally years ago. You have to educate yourself up to our level on TSLA before you can have a critical conversation. It's like asking professors to discuss things with toddlers.

Admissions exam -- come back when you can answer these questions.
(1) Explain the economic concepts of one-time costs, fixed costs, variable costs, and economies of scale. Use Tesla as a specific example.
(2) What are the reasons why electric cars will sell as fast as they can be manufactured? What defects in an electric car can cause it to not sell that fast?
(3) What is the underlying common theme in all complaints by Tesla owners about the company?

 

[neroden]

Seeing if I should go for the TSLAQ play. I'm waiting for someone to convince me that the Twitter Shorts are spreading FUD, not facts.

But sadly no one wants to discuss a critical perspective.

Example: luis carruthers on Twitter

Supplier is suing Tesla for $200k. What do you make of this?

Tesla believes they didn't get the services which the supplier contracted to provide so they are disputing the bill and refusing payment. Seems pretty normal actually.

 

[Tslynk67]

vincent on Twitter

 

[Boomer19]

Firebird, do your own research. We're not going to do your homework for you. Yes, the Twitter shorts are spreading FUD, not facts. You don't need "someone to convince you", you need to do your homework and actually find the facts. Like I have done. Read all the footnotes in all the corporate documents, scour the Internet for the lectures revealing technical details, the actions of all the other carmakers in the world, etc. Drive the cars and figure out what other owners think.


No, we'd love to discuss a critical perspective, we just don't want to deal with nonsense which we debunked literally years ago. You have to educate yourself up to our level on TSLA before you can have a critical conversation. It's like asking professors to discuss things with toddlers.

Admissions exam -- come back when you can answer these questions.
(1) Explain the economic concepts of one-time costs, fixed costs, variable costs, and economies of scale. Use Tesla as a specific example.
(2) What are the reasons why electric cars will sell as fast as they can be manufactured? What defects in an electric car can cause it to not sell that fast?
(3) What is the underlying common theme in all complaints by Tesla owners about the company?

#2 law of diffusion of innovation

cliff notes version sorry @neroden
How great leaders inspire action

whole video great, but at about 11min you get the law of mass market success/acceptance

they will stop at nothing to prevent us “crossing the chasm”

early majority won’t try something until the innovators and early adopters have tried it first -

i.e. model 3s hitting the roads in thousands and drawing thousands more in will be “crossing the chasm” for tesla.

i suggest watching all, it’s worth the 18min

 

[neroden]

@HG Wells

i saw you ask yesterday

View attachment 315889

Hmmm. US people definitely can't trade in Shenzhen... I wonder about London and Luxembourg and Dublin.

 

[MartinAustin]

Phil LeBeau on Twitter

 

[neroden]

Just wanted to remind folks that some of us (not just me) saw this bear attack coming and know that bears would emphasize low Q2 deliveries while dismissing the peak production figure. What I did not anticipate was just how far shorts could drive the price. I figured we would test $330.

At any rate, it was completely foreseeable that bears would attack and feel victorious. They would especially feel victorious about driving the price down when Musk had promised that they be burned. I do believe that this sense of vindication is part of the set up to the burn. The burn has not yet begun. Simply building 5000 Model 3 in the span of 7 days is not the burn or even the fuse.

So what is the burn? We can't rule out some surprise development. Perhaps. But personally I'm inclined to see the emergence of positive cash flow and profitability as the the completely out in the open slow burn. This is a nontrivial transition. Tesla has front loaded Q3 with an extra 11k Model 3 built in Q2 but to be delivered in Q3. Sure this is a little bit of a gimmick, so Tesla will need to sustain positive cash and profitability through Q4 to complete the burn. So I am looking at a 6 to 9 month burn. I don't think shorts will be able to survive 6 months of positive cash flow. They will find it increasingly costly to keep suppressing the stock for that length of time. But even if they do, Tesla in a position of free cash flow would be able to repurchase shares at whatever discount shorts would insist upon. In anticipation of paying off the 2019 bonds in Q1, it would not hurt to either repurchase shares or bonds as the cash is accumulation. Either way Tesla uses cash to reduce dilution when the bonds are converted to stock for final payment.

If one assumes that Tesla is positioned to generate enough cash over the next 9 months to pay this debt, then it leaves open the question what to do with that cash before the final payment is due. Why park that cash when they could buy the stock up to $360? To settle the debt in cash is the same as paying about $360 for the stock. So long as the stock is well below $360 it is cheaper for Tesla to repurchase shares at a 16.7% discount than to park cash for a cash settlement.

To play this really well, Musk needs the shorts to feel like they are invincible. The more victorious they think they are, the more push the price down. This gives Tesla a huge discount on settling this debt. Tesla could start quietly buying up shares anytime, even as the bears mock Musk for the burn of the century that never happened. All the while, Tesla is quietly cashing in on that discount. So let's keep this our own little secret. Do we really want the shorts to know when they are being roasted?

I am only disagreeing with your proposed financial operations in the stock and bonds; from my experience studying corporate financial shenanigans, your particularly proposed moves would not work.

I agree that what Tesla is going to do is be profitable and have positive cash flow. They said so.

 

[defc0n]

Hmm not finding any details about how it is being financed.

 

[Richgoogol]

I bet Elon really thought the news of hitting 5000/week combined with the China gigafactory news one week after would really cause a short squeeze, but he really did underestimate the power of the shorts. This is probably all the good news there is before the quarter.

 

[neroden]

Hmm not finding any details about how it is being financed.

Nope. I'm going to make a completely wild blue-sky guess. Bonds on the Chinese market. The Chinese bond traders don't listen to the same FUD-spreaders as the US bond traders.

 

[renim]

Tesla China plant said to roll into Lingang Area, Shanghai

wild guess, its in a SEZ but not a FTZ
(so no import tax, but its batteries initially preclude cafe style credits either)

also it seems that Tesla is mostly locked out of debt capital raising, so stock it will be.

nb, patience was rewarded, Tesla get 100% instead of 50%
but

 

[jelloslug]

Hmm not finding any details about how it is being financed.

With the losses from the short sellers.

 

[gene]

we have our 3rd Model 3 arriving for delivery 7/14. 2wd LR Silver. We configured less than a week ago. VIN: 40,3xx.

 

[Tslynk67]

Immediate short attack...