TSLA Market Action: 2018 Investor Roundtable

[omarsultan]

I'm also curious when the major media catch onto this stuff: 7 Charts — Tesla Model 3 vs The Competition (US Sales) | CleanTechnica

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

 

[RobStark]

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

That is what cautious bulls were saying about Model S in 2013 when Tesla was selling 1600 per month.

 

[Runarbt]

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

I dare claim that he and you are both wrong.

If Tesla does not affect the sales of the other brands - then those wouldnt have dipped. Doesnt really matter if it is backlog or not. This is a planned sustained production rate for tesla.

Sure, the Model 3 graph wont have the parabolic rise - but it will be just as high, on a level and permanent basis. And the other graphs will be even lower, on a sustained low level imho. ;-) So only difference is we wouldnt see the parabolic rise for Tesla and slow fall on the other brands. Tesla way up there, and the others bottoms-scraping - that will be the same also after backlog has been taken care of.

When more ppl experience Tesla Model 3 - they should have no problem selling all they can produce, even at 10k/week.

 

[jbcarioca]

... I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

Not really.There are ~33 countries where Tesla is sold and/or Model 3 reservations were accepted. Actual deliveries have happened in only the US and Canada. More than 70% of global car sales take place where Model 3 is not now available. Nobody outside Tesla knows for certain where all the reservations are. Anybody who thinks demand for Model 3 is anywhere near satisfies with less than 10,000 per week is missing the market entirely.

anecdote: on my block in Rio de Janeiro there are ten Model 3 reservations that I know about. I only know a few people here. Just imagine what the whole globe will represent. Then just imagine what will happen when more than 100,000 Model 3's are around the US and Canada to show themselves off. Then what happens when Tesla makes a deal to allow direct or some type of dealer-based sales in Texas, Michigan etc? Anybody who thinks there will be demand-based limits on Tesla for S, X or 3 is ignoring market realities.

 

[madodel]

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

So he doesn't believe that Tesla is in part the reason all these comparative brands are losing market share? If Ford or BMW had a model that was eating into the other brands model sales in a specific segment all the auto and financial media would be screaming how incredible it was. I just don't see how having a reservation backlog that every other manufacturer would love to have can be spun as a negative. Does he really think demand will drop off a cliff when the reservation list is pared down to zero?

 

[jbcarioca]

... I just don't see how having a reservation backlog that every other manufacturer would love to have can be spun as a negative. Does he really think demand will drop off a cliff when the reservation list is pared down to zero?

How people manage to ignore the rest of the world is surpassing strange. Even more so when Tesla does no traditional advertising at all. Yet again more so when one considers Tesla has yet to have direct sales in TX, MI etc and can adopt some form of dealer distribution almost overnight so sales in those States can multiply.
Demand problem never will happen! Maybe 'never' is an overstatement, but certainly not anytime soon.

 

[dntbevl1]

These vin's were corrected to "100% dual motor"

This batch was not corrected to 100%. You're thinking of the 78580-81204 batch that was previously estimated at 88% AWD. Model 3 VINs on Twitter

 

[RobStark]

If Tesla does not affect the sales of the other brands - then those wouldnt have dipped.

The United States has had three consecutive record years of 17M+ automotive sales. That can't go on forever.

And the shift to Crossovers,SUVs and Pickups is at record levels.

70% Truck and 30% Car last month.

For some reason neither Model 3 nor Model X is collapsing ICE Crossover sales.

Not everything that happens in the Universe is a result of or reaction to Tesla/ Musk Industries.

 

[bobinfla]

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

No, they won't look the same, by the time Tesla burns through the 300k+ orders the charts will show Tesla superior to what they do now.

Where your colleague asserts they are skewed because they are comparing sales vs backlog (which will shrink), I would say they are comparing sales vs production (which will grow).

Tesla's sales will continue to be all the Model 3's it can make for the foreseeable future. As the production rate increases, the backlog decreases, but the wait time to get the car decreases which will increase the number of new orders from those not willing to wait years for their car. We've already seen this play out with the S and the X, still selling roughly 100k per year even though backlog was eliminated a while back. By the time Model 3 reaches steady state and production and new orders have come into balance, it will be at a much larger number than we are currently looking at.

 

[Esme Es Mejor]

Unless I’m missing something, Model 3 outsold not only all luxury cars in the US, but all luxury SUVs as well.

 

[omarsultan]

I think, 6 of the 7 charts show that as individual buyers are actually making purchasing decisions and cross shopping models, the Model 3 is consistently winning that decision. I think that bodes well for the Model 3 conversion rate and its longevity overall. The Model S has been able to maintain its dominance over the years, but six years later, its a different competitive environment and Tesla is no longer flying under the radar. Asking what happens after backlog is gone is a fair question.

This chart, however, seems a bit reductive to me:

Its seems like one of those charts used to illustrate causality vs correlation. Yeah, I can see the Model 3 eating into Prius sales, but we also know sedans sales are on the decline in favor of SUVs and X-Overs so I'd be cautious about how tightly one links the two trends as there are a number of market forces at work, not just the introduction of the Model 3.

 

[TradingInvest]

I had a Twitter convo about this with a colleague who's a smart dude and is generally a Tesla bull. His point on these graphs is that it's a bit of skewed comparison in that its comparing Tesla's backlog vs the "run rate" business for the other companies. To put it another way, once Tesla burns through the 300K+ orders, will these charts still look the same. I think these charts are a useful indicator of Tesla's conversion rate on its reservations, but he does have a fair point.

I agree that we are comparing fulfilling backlog vs the "run rate" business. But your friend is missing an important fact: the Model 3 is so much better than all those ICE cars. What would be the true "run rate" demand for Model 3, after the general public learn the fact? Think how many people will get a chance to hear about it and test drive it, after we have 200,000 Model 3s on the street.

This is one of the main points that most shorts still don't get. It's the legacy companies that are in trouble.

 

[Runarbt]

And we have initiated lift-off.. ;-)?
Volume spikes - trying to push past 350 again.


Edit: Oh Yeah baby.. 350.01

Edit: Oh noo.. 349.85

Edit: Oh yeah.. 350.01

Edit: entering battle mode * 350.01 VS. 349.8x *

 

[RobStark]

Unless I’m missing something, Model 3 outsold not only all luxury cars in the US, but all luxury SUVs as well.

Jeep Grand Cherokee which starts at $31k and tops out at $130k( MSRP about $95k but quoting dealer price) for the Trailhawk Luxury package outsold Model 3.

But the point is Luxury Crossover sales are not falling much less collapsing. Each luxury SUV maker has various entries. If you want a Tesla under $77k Model 3 is the only game in town. If Tesla had 4 vehicles under $77k then sales would be splintered.

 

[Chocochip]

So he doesn't believe that Tesla is in part the reason all these comparative brands are losing market share? If Ford or BMW had a model that was eating into the other brands model sales in a specific segment all the auto and financial media would be screaming how incredible it was. I just don't see how having a reservation backlog that every other manufacturer would love to have can be spun as a negative. Does he really think demand will drop off a cliff when the reservation list is pared down to zero?

I think the point is missed here. I doubt the intention was to spin the statistics negatively, but merely to point out that a significant proportion of the customers buying the Model 3 at the moment are people who have been waiting for it for two years (or more, if you include the anticipation pre-March 2016), rather than impulse-buyers or people who simply need a new car right now.

Taking over market share equates to lost sales for the other manufacturers only if the size of the pie stays the same. I think there is some increase of the pie size recently, although clearly there have been lost sales for the large OEMs. What WILL be relevant is the steady state sales level, when the availability of the Model 3 is similar to the current availability (read that as order-to-delivery lead time) of the S and X, for most versions.

For what it's worth, I am extremely optimistic on that front, so much so that I believe we are still maybe one year away from the above-mentioned steady state.

 

[Unpilot]

And we have initiated lift-off.. ;-)?

Volume spikes - rying to push past 350 again.

Edit: Oh Yeah baby.. 350.01

Edit: Oh noo.. 349.85

Edit: Oh yeah.. 350.01

Edit: entering battle mode - 349.84

Edit: Nooo... Loosing gound: 349.59

The battle is at 350 right now. I think we close above.

 

[SwTslaGrl]

@RobStark
“Jeep’s efforts into EV products will be interesting...
Jeep Moves Forward With Plug-In Hybrid SUVs | Trucks.com

 

[jhm]

Love this $350 run. How long can $350 keep going?

 

[Esme Es Mejor]

Jeep Grand Cherokee which starts at $31k and tops out at $130k( MSRP about $95k but quoting dealer price) for the Trailhawk Luxury package outsold Model 3.

But the point is Luxury Crossover sales are not falling much less collapsing. Each luxury SUV maker has various entries. If you want a Tesla under $77k Model 3 is the only game in town. If Tesla had 4 vehicles under $77k then sales would be splintered.

Yeah, I saw the Grand Cherokee numbers & didn’t know how to classify them. The resource I’m leaning on (GoodCarBadCar) does not classify them as luxury, so I followed their lead. I think, in reality, the low-end Grand Cherokees are not luxury vehicles, the high-end ones are, and where to draw the line is open to debate.

But my point is: Model 3 is doing great whether you compare to declining sedans or growing SUVs, luxury or non-luxury, or the market as a whole. The magnitude of its success is getting hard to ignore.

 

[ZachShahan]

HEADLINE: Shortsville Times

Small & Midsize Luxury Car Sales Stumble. Tesla to Follow.

Did I twist that enough Zach?

Damn, you are good. You should get a job at CNBC.