TSLA Market Action: 2018 Investor Roundtable

[Tslynk67]

I'd just got to the end of my tether and was about to block Donn the bum, but I see he's been banned in the meantime. It's just incessant FUD, seriously, you should all stop arguing with him, the same garbage regurgitated over and over.

I see we have a bird in the house again though...

Going to be an interesting week, I wonder if we'll get a by the rumour run-up, or a record bunch of nonsense from the "news" sites?

 

[sub]

Karen you have read my production articles. I am sure you have double-checked my numbers. It is pretty easy since Tesla supplies the numbers each quarter that are used in my charts.

Supply already exceeds demand for certain Model 3 configurations here in the U.S. But no action seems to be happening to adjust. Just as they did in early 2017 Tesla has been building cars at full speed, ahead of actual orders. That results is imbalances. Many readers here and on my articles think Tesla builds only what has been ordered which is not the case and has never been the case since I began watching the numbers in 2016. I think it relates to issues with their paint process. They seem to be forced to build cars in batches by color. Then the ISA's do their best to match orders to produced units. It is the only way to explain why orders placed in April, May and June are still not filled, while others placed new orders earlier this month and have already taken delivery of their cars. You only need to spend a few minutes on Troy's spreadsheet or on the delivery threads to see what I am saying is true.

I do not expect Tesla to ever build an unoptioned Model 3 SR or LR. What we will see is an SR at about $39-$41,000 which will include PUP or AWD as standard equipment. Just as Tesla has done with the Model S and X where RWD is no longer an option. I say this because the Monroneys have already been altered. They no longer show a base $35,000 price plus options. They now shown a base of $49,000, $54,000 (recently increased to $55,000 or $64,000. As I said, that 2017 press kit link is the only place you will find any reference to a $35,000 Model 3. It has been completed removed anywhere else on the Tesla website.

Just like all trolls you’re good at cherry picking. So, 63,000 cancellations are all because SR is delayed or not coming at all? Can you provide a link please?

Elon/Tesla said SR version will be offered first and all reservations will get FTIC? Of course Elon also knew every single person that reserved for SR would also qualify for the FTIC? Link please.

I can cherry pick too, I reserved two model 3’s, planned to buy an MP3 version but bought a model X instead. I’ve read countless posts of people doing the same for S/X. I cancelled one reservation but have kept 2nd because you never know, I’ve considered ordering it a couple times.

You say there is no mention of SR model 3 on Tesla’s website? You sure? Still says standard battery available in 4-7 months in my account, on TESLA’s website!

But hey, random self proclaimed expert on the Internet who has no insider knowledge of company plans/data/financials says Tesla is doing it all wrong. Ok.

 

[jasonb]

For liability reasons, none of the dealers would allow it. I know I would not have done it. I would also want control of the narrative. You lose that with volunteers without proper training.

I can tell you why. for same reason that tesla gives really nice loaner cars. they aren't scared of comparisons or the truth.

btw: when they start making the 35k car what will you complain about next? have you already picked something or will you just make it up as you go?

 

[Fact Checking]

They might pay double for a roof that won't get destroyed every time there's a big hail storm. Probably a significant insurance discount on that.

That's a very good point, one of the big selling points of premium roof window maker Velux is hail resistance of their products:

Which they follow through with long-term hail storm damage warranty included with premium glass installations.

Hail damage can be particularly problematic for solar installations:

But hail can damage high quality ceramic roof tiles as well.

While obviously you can always buy separate insurance, insurance usually does not cover full re-roofing of roofs done 10-20 years ago if the tiles cannot be perfectly color-matched.

So it's generally considered a plus if premium roof products are very robust physically and if the maker of the product is willing to offer a warranty to back up those claims of robustness.

 

[Fact Checking]

New I'd just got to the end of my tether and was about to block Donn the bum, but I see he's been banned in the meantime. It's just incessant FUD, seriously, you should all stop arguing with him, the same garbage regurgitated over and over.

The flood of concern trolling with which he tried to scroll off various pieces of positive Tesla news that arrived over the weekend was all too obvious.

In case any investor who wants to discuss both the bull and the bear thesis with an open mind is wondering whether Donn Bailey (@beachbum77) is making genuine contrarian arguments, here's a point by point rebuttal of one of his so-called "fact based" anti-Tesla articles on Seeking Alpha, which rebuttal he saw but never even replied to, because, I proffer, he cannot:

'Summary: your article contains at least 2 false claims, 2 misleading claims, flawed comparisons and flawed logic, plus lots of negative innuendo that has no place in a purported "fact based" article.'​

So while we should always be wary of suppressing contrarian views, what he's been doing here yesterday was clear-cut bad faith trolling through and through, and at this point he's basically an ex Ford dealer trying to disrupt a useful Tesla discussion forum, which parasitic barnacle was (rightfully) scrubbed off the hull of this forum by the mods.

 

[lklundin]

I am guessing that 2019H1 will see large-scale sales of the Model 3 in Europe:
1) 19 Model 3 VINs registered recently, apparently for Europe,
2) large number of open Tesla Sales positions (esp. German speaking) in Europe only exceeded by American ones,
3) 2019H1 sees the end of substantial BEV incentives in Germany + Austria.

4) Tesla's presence at its main EU location in Tilburg, NL is being extended with a 36k m^2 warehouse for replacement parts a few hundred meters from their other buildings:

Tesla's new Tilburg site hints at new storage and parts center ahead of Model 3 EU push

And now this:
5) #Tesla registered 7 new European #Model3 VINs (116264-116270). 4 AWD and 3 RWD.
Model 3 VINs on Twitter
- this tweet seems more definitive than the August 31 tweet regarding apparent EU VINs.

 

[CorneliusXX]

I hear you, but Elon's made his ambitions pretty clear during the 2018 Q2 Earnings Call:

James Albertine -- Consumer Edge Research -- Analyst

Good afternoon, and thank you for taking my question. And appreciate all the color you've been providing, wanted to dig a little bit deeper, though, in terms of capital spending plans. Considering your growth you've identified in China with the Model Y, we believe also in the EU, it's been discussed a factory there. How do you plan to fund all of this growth without going back to the capital markets to raise funds? And can you verify for us whether or not there is a notice from a regulator that would prevent you from raising outside capital? Thanks.

Elon Musk -- Chairman, Product Architect, and CEO

We do not ... we will not be raising any equity at any point, at least that's ... I have no expectation of doing so, do not plan to do so. For China, I think, our default plan will be to use essentially a loan from the local banks in China and fund the Gigafactory in Shanghai with local debt, essentially. And we certainly could raise money but I think we don't need to and we ... yeah, I think, it's better to ... it is better discipline not to.​

Elon has had his fill of Wall Street. If he can get the money he needs from Operations and low interest local loans, why would he expose Tesla to Wall Street shenanigans every again? Clearly, Elon estimates Tesla's CapEx requirements as deliberate and sustainable over the long term, w/o Wall St.

Cheers!

I am more addressing the idea of a buyback rather than a capital raise. Agree he will likely not equity capital raise again, but he also has far more ideas to spend money on than Tesla will be able to fund through internally generated profits. This is why a share buyback seems very unlikely.

 

[avoigt]

That is not true! Please stop spreading wrong information:

VW did not deny and did not comment!

"Volkswagen selbst wollte das Angebot bisher nicht kommentieren. Daher lässt sich auch nur darüber spekulieren, welche Pläne die Manager des Konzerns mit ihrer Offerte verfolgten"
Musk lehnt dankend ab: Volkswagen wollte bei Tesla einsteigen!

I don't think that Reality is spreading wrong information. You quote a no comment from an anonymous Volkswagen spokesman on Aug 28. However, on Sep 5 the Volkswagen CFO gave a specific denial. Here is the link (denial starts about 1:40):

[/QUOTE]

Fair enough and thanks for posting.

Allow me to have a hard time to believe anything that I hear from VW though. This includes in particular the C-Level.

 

[CuriousSunbird]

Does that admission obviate Tesla's Directors' & Officers' Liability Insurance carrier's duty to provide a defense to Elon in Shareholder Derivative Litigation arising out of his series of tweets on Aug 7? Also, is the corporation's indemnity for the benefit of its officers and directors when acting on behalf of the corporation inapplicable when an individual acts, not in his capacity as an officer or director but, for himself and other interests?

You would have to think so. Will be interesting to see if he maintains the same position in the court filings.

 

[Fact Checking]

I hear you, but Elon's made his ambitions pretty clear during the 2018 Q2 Earnings Call:

I am more addressing the idea of a buyback rather than a capital raise. Agree he will likely not equity capital raise again, but he also has far more ideas to spend money on than Tesla will be able to fund through internally generated profits. This is why a share buyback seems very unlikely.

I'd like to point out that Elon's announcement that Tesla intends to buy back the $920m 2019 convertible notes is a stock buyback program in essence: if that debt was paid in new shares (as the convertible nature allows), it would dilute shareholders.

But Tesla should certainly not use free cash to buy back stock this year or next year - maybe they could start buying back convertible notes from the open market later this year, which at current prices would probably be cheaper than paying them back in cash. But by the time Tesla has the cash to do that, share price will probably rise significantly, which is going to make those 2019 convertible notes significantly more expensive.

 

[CuriousSunbird]

]\

I see we have a bird in the house again though...

Thanks for noticing. And let me take this opportunity to say how glad I am to be back with you all, and to apologize for the FUDster behavior which led to my involuntary absence.

I am not sure whether it was my foolish prediction that the SP would go below $300, or my expression of doubts as to the veracity of the going private tweets (full disclosure - I am affiliated neither with the DoJ nor the SEC) or even my switch back from a long to a short position which led to my ouster. Whichever it was, I hope that nobody here relied on my opinions in forming their own views.

Looking forward to further spirited discussions.

 

[Tslynk67]

Shorts attacking early to try and nullify the very positive sentiment on low volume...

 

[Tslynk67]

Thanks for noticing. And let me take this opportunity to say how glad I am to be back with you all, and to apologize for the FUDster behavior which led to my involuntary absence.

I am not sure whether it was my foolish prediction that the SP would go below $300, or my expression of doubts as to the veracity of the going private tweets (full disclosure - I am affiliated neither with the DoJ nor the SEC) or even my switch back from a long to a short position which led to my ouster. Whichever it was, I hope that nobody here relied on my opinions in forming their own views.

Looking forward to further spirited discussions.

Well you're a bit hit-and-miss, if you don't mind me being frank with you, but you're not a lost case, like the other one

 

[CuriousSunbird]

Well you're a bit hit-and-miss, if you don't mind me being frank with you, but you're not a lost case, like the other one

I never mind frankness, I welcome reasoned opposition and I would never be so foolish as to ignore or suppress a different opinion.

 

[BioSehnsucht]

Hail damage can be particularly problematic for solar installations:

But hail can damage high quality ceramic roof tiles as well.

While obviously you can always buy separate insurance, insurance usually does not cover full re-roofing of roofs done 10-20 years ago if the tiles cannot be perfectly color-matched.

So it's generally considered a plus if premium roof products are very robust physically and if the maker of the product is willing to offer a warranty to back up those claims of robustness.

Here in Texas hail is somewhat common (can be expected several times a year, and sometimes up to softball sized), but it's rare to have damage to a solar panel without worse damage to the regular roof. Most roofs here are asphalt shingle roofs, and solar panels tend to hold up better for longer against hail, though of course occasionally the hail is bad enough (big enough hailstones) that even solar panels are damaged. If your solar panels end up like that picture you linked, assuming they weren't some kind of physically weak panels to begin with, then your roof should be filled with at least as many holes, if not more.

Of course, if you must replace the roof due to hail but not the panels, you still must have the panels removed and reinstalled to replace the roof itself ...

 

[gora321]

FUDsters-the job!

In a last week before some data... I expect tons of FUD. Nothing new here.
I want to characterize the job.

When I was young older people taught me that each job is respectable, decent, honorable. I believed them.

12 years ago I visited memorial centre where WWII nazi concentration camp had stood. There were many across the Europe. This one is in Croatia/Jasenovac. It was mentally exhausting for me even to listen all these stories how "human being" can be evil, brutal...
I remembered one story particularly that shocked me.

There were the killing day. The executioner asked the old man how is he filling before dying? Are you afraid?
The old man said: Son, you shouldn't worry about me. I have lived long enough. You should worry what kind of job you have.

I cried. I cried then and now..each time I remember that.

You should worry what kind of job you have.

 

[BenPrice]

Shorts attacking early to try and nullify the very positive sentiment on low volume...

View attachment 337669

I think anything significantly affected by China trade relations will take a hit today.

TSLA seems like half the time it trades near the meta, half the time it does whatever it wants. We’ll find out soon enough what today is.

 

[CuriousSunbird]

Wasn't this discussed ad nauseam a couple of weeks ago? Jeez. Cant we just hold off discussing this until there is an actual ruling. Thanks!

The stock market is a mechanism for discounting and assessing future cashflows, To assess future cashflows, it is necessary to analyze the probability of multiple possible future scenarios. If this is a thread dedicated to trying to predict Tesla's future stock price, then Brian is right to raise such issues.

But if it is just a cheerleader thread then you are probably right to recommend ignoring them.

 

[Phlebas3]

I think it relates to issues with their paint process. They seem to be forced to build cars in batches by color.

Are you seriously saying this? This shows you have ZERO understanding of how production works. Of course they batch it by color, just like any other car manufacturer. Do you expect them to clean their entire paint installation after every car? Are you really that stupid?

 

[Fact Checking]

Nice article from @ZachShahan:

"These 3 Graphs Show What Tesla Bears Are Lying To You About — $TSLA, Not $TSLAQ"
​

Favorite graph:

Or, in terms of opex vs. gross profits:

BTW., that 18Q2 bump up in the green opex line was due to one-time reorganization cost items, and also due to higher stock based compensation expenses due to a higher stock price in Q2, and there are credible estimates that are predicting significantly higher gross profits for Q3 and Q4 than this graph depicts.