TSLA Market Action: 2018 Investor Roundtable

[Fact Checking]

Still trying to come of with the name of the mental disorder you have to have to go to the trouble of making an account on a forum of things you hate, just to troll the community there. I'm sure some of them have financial interests. I think others don't, they're just straight out wack.

For most trolls I've seen here the disorder is called "seeking attention". Most people get over that phase in childhood - but not all.

They are not capable enough intellectually to gain attention through positive contributions and excellence - so instead they go to communities they despise and try to inflict damage and disruption and get a kick out of that - spiced with a bit of financial self-interest as well.

It's the easier path for them: increasing entropy is always easier than decreasing it. Creating doubt is easier than removing it.

They are members of the 5% of humanity that has no trouble living a parasitic life, they have no moral inhibitions keeping them from inflicting damage on others for personal gain.

 

[beachbum77]

If Tesla wants to achieve highest delivery numbers, they can plan to deliver the last 2 weeks production to CA customers.

Glad you agree. I said the same thing a few hours ago. I also think they should offer free SC access for the trip home to anyone willing to come from out of state to pick up in CA before 9/30.

 

[Mike117]

For most trolls I've seen here the disorder is called "seeking attention". Most people get over that phase in childhood - but not all.

They are not capable enough intellectually to gain attention through positive contributions and excellence - so instead they go to communities they despise and try to inflict damage and disruption and get a kick out of that - spiced with a bit of financial self-interest as well.

It's the easier path for them: increasing entropy is always easier than decreasing it. Creating doubt is easier than removing it.

They are members of the 5% of humanity that has no trouble living a parasitic life, they have no moral inhibitions keeping them from inflicting damage on others for personal gain.

You must clearly be talking about a certain CEO .. Elon Musk, right?

-always seeking attention on social media
- he tries to conflict damage on social media as he seeks spiced with a bit of Tesla interest
- no problem damaging shareholders for his personal gain

 

[beachbum77]

The only reason I am discounting that in a few of my posts is they are having enough problems pushing through deliveries spread out over the whole USA so to concentrate them on CA centers for 2-3 weeks...well, I'd hate to be the Tesla employees working there if they do. But who knows, they could be lining up a huge glut of home deliveries in CA to get around that.

Edit: For an anecdotal example there have been a few stories on reddit of deliveries at Freemont already being a bit of a gong show. So to then concentrate everything on CA might just not be feasible. Baring home deliveries or new pop-up delivery centers like they did in Vancouver and Toronto that I know of.

I have traveled the car circuits and the RV circuits. Stadiums have huge empty parking lots most every day. I was a participant in dealer shows at Dodger Stadium. We sold and delivered cars on the spot no different from what Tesla did in Toronto and Vancouver. One large tent is all you need for prep and delivery outdoors. Bring a few of the Tesla Rangers for last minute issues. Most convention centers are empty now too. In six or seven days you could empty out that lot in Burbank, CA if they are all CA bound cars.

 

[Fact Checking]

The amount of rework and canceled deliveries over quality issues are going to be more costly than projected

That's a false claim: even the cars from the 5k week from end of July needed less than an hour-person of light rework on average before they passed QA - which costs very little for the $55,000-$60,000 avg ASP Model 3.

If you want to make that argument credibly you need to cite actual, credible evidence - not just anecdotes and innuendo. I predict you have no such evidence, you are simply making this up.

Fact is: luvb2b's modeling of Q3, which is using the low 50k end of Tesla's guidance, is showing Q3 as a profitable quarter, with a positive cash flow - which directly contradicts your claim that Tesla cannot be profitable at 51k deliveries.

And they can do that despite Tesla having Model 3 expansion related temporarily drain on cash of more than $600m per quarter for the rest of 2018.

I.e. you made another false claim, just to support your Tesla-short agenda.

 

[Electroman]

no problem damaging shareholders for his personal gain

Personal gain?

This member is a real Capital T

 

[EngRyan]

I have traveled the car circuits and the RV circuits. Stadiums have huge empty parking lots most every day. I was a participant in dealer shows at Dodger Stadium. We sold and delivered cars on the spot no different from what Tesla did in Toronto and Vancouver. One large tent is all you need for prep and delivery outdoors. Bring a few of the Tesla Rangers for last minute issues. Most convention centers are empty now too. In six or seven days you could empty out that lot in Burbank, CA if they are all CA bound cars.

I think we are on the same page on this anyways. To concentrate deliveries in CA they'd have to do something along these lines I would guess. Perhaps it would be easier to pull off then I think it is. But if you feel so strongly about it I'll agree with you. How much should we raise our delivery estimate over 51k then? To 58k? More?

 

[beachbum77]

That's a false claim: even the cars from the 5k week from end of July needed less than an hour-person of light rework on average before they passed QA - which costs very little for the $55,000-$60,000 avg ASP Model 3.

If you want to make that argument credibly you need to cite actual, credible evidence - not just anecdotes and innuendo. I predict you have no such evidence, you are simply making this up.

Fact is: luvb2b's modeling of Q3, which is using the low 50k end of Tesla's guidance, is showing Q3 as a profitable quarter, with a positive cash flow - which directly contradicts your claim that Tesla cannot be profitable at 51k deliveries.

And they can do that despite Tesla having Model 3 expansion related temporarily drain on cash of more than $600m per quarter for the rest of 2018.

I.e. you made another false claim, just to support your Tesla-short agenda.

I have been following the threads and using my own observations in NC and FL to gauge the percentage of potential rejected cars. Many are over paint issues. Those are not fixed in 37 minutes. What is also clear is that many of those 4,300 cars from that last week in June were not completely fixed. Issues still existed by the time the cars made it to the DC's and issues are still continuing today.

Our algorithms and spreadsheet data come to different conclusions than luvb2b. So what? Everyone gets an opinion at this point. In about 60 days we will know who was correct and what it did or would have taken to produce a profit.

 

[beachbum77]

I think we are on the same page on this anyways. To concentrate deliveries in CA they'd have to do something along these lines I would guess. Perhaps it would be easier to pull off then I think it is. But if you feel so strongly about it I'll agree with you. How much should we raise our delivery estimate over 51k then? To 58k? More?

Lol...You would have to pose that question to the new delivery group people. They are the ones tasked with getting it done.

 

[PaulusdB]

Everyone needs to block beachbum and Mike. I've been falsely accused of being a short, but clearly they both are.

That or Mike just has his ants in his panties and can't wait a few months for Tesla to continue to deliver.

Hint: you can help others to block a TMC member by publishing the ignore link on that persons profile.

E.g. https://teslamotorsclub.com/tmc/members/tsla_hopeful.21735/ignore

(No reason for blocking you, just to show the way to facilitate that.)

 

[EngRyan]

I have been following the threads and using my own observations in NC and FL to gauge the percentage of potential rejected cars. Many are over paint issues. Those are not fixed in 37 minutes. What is also clear is that many of those 4,300 cars from that last week in June were not completely fixed. Issues still existed by the time the cars made it to the DC's and issues are still continuing today.

Our algorithms and spreadsheet data come to different conclusions than luvb2b. So what? Everyone gets an opinion at this point. In about 60 days we will know who was correct and what it did or would have taken to produce a profit.

Anecdotal but my brothers 3 paint issue was a small chip in the driver door frame the delivery specialist caught and told us about. Listed it on the paperwork and all but after Tesla said they could have the area re-sprayed and all we (as he talked to me about it) decided it wasn't worth it for a chip he doesn't ever notice. Plus they could respray the area and get the color match wrong or who knows what else. So in that case the problem did just go away for Tesla with zero work. Wouldn't be surprised if a sizable portion of them went this way.

 

[beachbum77]

Hint: you can help other to block a TMC member by publishing the ignore link on that persons profile.

E.g. https://teslamotorsclub.com/tmc/members/tsla_hopeful.21735/ignore

(No reason for blocking you, just to show the way to facilitate that.)

You will not have much of an investor roundtable if everyone at the table is of one mind. Ten people can look at a painting and each will notice something the others do not. But hey, put on those blinders and earplugs. Does not bother me.

 

[beachbum77]

Anecdotal but my brothers 3 paint issue was a small chip in the driver door frame the delivery specialist caught and told us about. Listed it on the paperwork and all but after Tesla said they could have the area re-sprayed and all we (as he talked to me about it) decided it wasn't worth it for a chip he doesn't ever notice. Plus they could respray the area and get the color match wrong or who knows what else. So in that case the problem did just go away for Tesla with zero work. Wouldn't be surprised if a sizable portion of them went this way.

I would agree with your brother's decision. It is nearly impossible to duplicate a factory paint job so you want to avoid repainting a door, hood, or fender at all costs. In reading some of the posts and the linked pics I think some people have gone way overboard on tiny issues. To call it nit-picking is an understatement. But Tesla started it by trying to deliver cars with too many issues that led to the infamous "checklists" for M3.

 

[Fact Checking]

I have been following the threads and using my own observations in NC and FL to gauge the percentage of potential rejected cars. Many are over paint issues. Those are not fixed in 37 minutes.

That's anecdotal, complaints are over-represented on social media, they are self-selected that are not representative of all owners, but most importantly it's also immaterial: any rework of vehicles before delivery and warranty work after delivery is accounted as cost of revenue and is already part of Tesla's financial statements and projections. Initial batches of cars tend to have higher rework rates - production gets smoother as time progresses.

Tesla is guiding for a ~15% profit margin on the Model 3 with all those cost factors included, and they recently reported significant additional reductions in Model 3 labor costs, which will help Q3 numbers beyond their initial guidance. Based on that conservative guidance luvb2b's model is projecting Q3 as profitable and cash flow positive, even with just 50k Model 3 deliveries that are at the lowest end of the guidance, and despite heavy -$600m cash drain caused by temporary Model 3 factory expansion capex.

To counter that you cited no credible evidence, your innuendo has no basis in fact and you are continuing to make false statements, which is proof that you are not participating in the discussions on this forum in good faith, you are apparently "stock bashing" to talk up your purported short position, which is an illegal market manipulation scheme, a federal crime and felony.

You need to retract your false statements and you need to apologize for trying to mislead readers of this forum.

 

[SpaceCash]

Something is about to give.

Notice that the people who are paid to bash the stock are more ridiculous and random than EVER before, making up literally anything at all. In the past their narratives at least had a shred or two of credibility. Now they're literally just stringing vaguely negative sounding phrases together hoping someone will bite. They don't even seem all that serious about it any more.

I think price is due for a squeeeeeze and feel it more urgently than ever before. I don't wanna go all out TrendTrader007 but...

Wait yeah I do. Hang in there, SP has GOTTA boom shortly. No hype, all seriousness. Not an advice

 

[beachbum77]

That's anecdotal, complaints are over-represented on social media, they are self-selected that are not representative of all owners, but most importantly it's also immaterial: any rework of vehicles before delivery and warranty work after delivery is accounted as cost of revenue and is already part of Tesla's financial statements and projections. Initial batches of cars tend to have higher rework rates - production gets smoother as time progresses.

Tesla is guiding for a ~15% profit margin on the Model 3 with all those cost factors included, and they recently reported significant additional reductions in Model 3 labor costs, which will help Q3 numbers beyond their initial guidance. Based on that conservative guidance luvb2b's model is projecting Q3 as profitable and cash flow positive, even with just 50k Model 3 deliveries that are at the lowest end of the guidance, and despite heavy -$600m cash drain caused by temporary Model 3 factory expansion capex.

To counter that you cited no credible evidence, your innuendo has no basis in fact and you are continuing to make false statements, which is proof that you are not participating in the discussions on this forum in good faith, you are apparently "stock bashing" to talk up your purported short position, which is an illegal market manipulation scheme, a federal crime and felony.

You need to retract your false statements and you need to apologize for trying to mislead readers of this forum.

And I say it will take 55-56k deliveries. There is no way to tell who will be right until early November. Then, if I am proven wrong I will be happy to admit such. Until then I am sticking to my numbers.

I do not have a short stock position. I buy long-dated puts and calls as the SP moves. I have said this before and I will say it again, I do not believe in shorting stocks, because you can be forced out of your position at any time by the lender of the shares. Only time can force you out of an option position.

I am also not retracting one thing I have written. Maybe in Austria you can bully people but that does not work here in the U.S. Here, everyone is entitled to their opinion no matter how idiotic it may seem. Just read the politicians on Twitter to see what I mean.

 

[Unpilot]

I have been following the threads and using my own observations in NC and FL to gauge the percentage of potential rejected cars. Many are over paint issues. Those are not fixed in 37 minutes. What is also clear is that many of those 4,300 cars from that last week in June were not completely fixed. Issues still existed by the time the cars made it to the DC's and issues are still continuing today.

Wow so your saying that YOU have witnessed enough and have been scanning internet forums enough to make the claim that enough cars are rejected as to make a Material dent in Tesla finances.

That is a wonderful crystal ball you have there. Problem is it seems to only have clouds and trouble in it.

Your not on ignore for me because you provide some needed comic relief.

 

[neroden]

I wish I could, but my work is owned by our fund. I can point you to one area I think is off in the link you provided. Cost of revenues for M3. The amount of rework and canceled deliveries over quality issues are going to be more costly than projected.

Really?

I figured most of that came out of the warranty reserve, certainly for the delivered cars which had to go back into the service center. Do you have a reason to believe otherwise? Warranty reserves got raised in Q2....

Most of the cars requiring rework before delivery seem to have been done at the service centers by the *salaried* service center workers. Only the parts would add to cost of revenues.

Luvb2b is estimating *$50,400* per car as the Model 3 "cost of revenues". Honestly this seems... high? I'm not sure how you're calculating it, but it seems to me like there's a large allowance for trouble and unexpected costs in that number. I mean, all of us can only guess as to Tesla's cost structure, since it's a trade secret, but the *variable* costs appear to be around *$28,000* based on the German teardown, so there's gobs of room for capital equipment depreciation, warranty reserves, and unexpected costs in that. Honestly this is one of the highest cost-of-revenue numbers I've seen in any estimate, so I'm wondering where you're getting your higher number.

That is why we see more deliveries being needed. I also think he may be low in his projected ZEV revenue.

I have always thought a profit in Q4 (ahead of the reduction in the FITC) was a more sure thing. I figured Tesla would get its delivery mess solved by then. But will it be too little, too late?

No. How could it? Profit in Q4 and more-or-less-breakeven in Q3 is all that's needed to pay off the upcoming bond maturities.

 

[beachbum77]

Wow so your saying that YOU have witnessed enough and have been scanning internet forums enough to make the claim that enough cars are rejected as to make a Material dent in Tesla finances.

That is a wonderful crystal ball you have there. Problem is it seems to only have clouds and trouble in it.

You're not on ignore for me because you provide some needed comic relief.

Ok, that made me laugh! I gave you a "funny".

I read a survey recently of "M3 owners". The author used a survey sample of 28 owners... that is right 28 owners out of 70,000+ to form all sorts of conclusions. Were the ones he cited the only 28 he spoke to? who knows? My point is statistical sampling is done every day. How much of it is really useful is debatable. Sadly, we are in another political season and will have to listen to the noise about poll after poll saying this or that. Oh joy!

 

[Unpilot]

Really?

I figured most of that came out of the warranty reserve, certainly for the delivered cars which had to go back into the service center. Do you have a reason to believe otherwise? Warranty reserves got raised in Q2....

Most of the cars requiring rework before delivery seem to have been done at the service centers by the *salaried* service center workers. Only the parts would add to cost of revenues.

Luvb2b is estimating *$50,400* per car as the Model 3 "cost of revenues". Honestly this seems... high? I'm not sure how you're calculating it, but it seems to me like there's a large allowance for trouble and unexpected costs in that number. I mean, all of us can only guess as to Tesla's cost structure, since it's a trade secret, but the *variable* costs appear to be around *$28,000* based on the German teardown, so there's gobs of room for capital equipment depreciation, warranty reserves, and unexpected costs in that. Honestly this is one of the highest cost-of-revenue numbers I've seen in any estimate, so I'm wondering where you're getting your higher number.


No. How could it? Profit in Q4 and more-or-less-breakeven in Q3 is all that's needed to pay off the upcoming bond maturities.

See the comic relief in his comment "But will it be too little to late"