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TSLA Market Action: 2018 Investor Roundtable

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Tesla will screen 'Cars 3' at Gigafactory as thank you to employees

This P's me off big time, in fine print I am specifically not invited! I could have smashed two stones into one by going to see my wife's parents with her and taken my GrandPups to see the movie-all-in one:) Could have made it like a drive-in ~ opened the the tailgate (Model X) and watched the movie!

I just finished logging onto father-in-law's computer to update his Excel checking ledger ~ deleted some unused lines in September. And to think he was actually a rocket scientist:eek: He was consulted following the first loss of astronauts.

Trivia:

Natalie Certain in Cars 3 is a Model S.
:D

Oh and obligatory short spin:

No demand, so no need to make batteries.

Let’s just watch a movie while the Titantic sinks.
 
People do it every day on CNBC, CNN, FOX, etc. They need intelligent contrasting opinions, otherwise viewers tune out. Contributors are asked to put together opinions for a given position. That is how news reporting works. How many others gave similar conclusions? As far as I can find no one else who took Gorman's position.
You didn't look very hard, did you? I cited a different M&A specialist about that earlier, who agreed with much of what Gorman said later. You're a bit dishonest -- you were here for that.

The SEC definitely didn't want to take this to a jury trial. First of all, they never do; juries are a crapshoot, and they always want settlements. Second, given the timelines on jury trials, the jury would have been hearing the case in 2019 or 2020, while TSLA stock is likely to be above $420. Under those circumstances, convincing a jury that Musk deliberately "inflated" the price of the stock will be impossible. Convincing them that there was no solid financial offer will also be impossible -- because hindsight is 20/20 and everyone wants to think they were smart enough to know how much the company was worth back then.

Contrary to what most people think, "funding secured" wasn't the problem -- precedent says it doesn't mean "committed", it means merely "lined up". That part of the case was very weak.

The strong part of the SEC case was the other bits, and so Musk really needed to settle.
-- Musk *really* should have known that he couldn't keep all small stockholders in the company if it went private. If I can look this up, Musk could have too. He made a statement which he believed to be true, but *should have known* was false, had he done even a few minutes of due diligence. And the SEC can fine you for that sort of recklenessness.
-- Likewise, he should have known better than to say that a stockholder vote was the *only* remaining hurdle -- government approvals, board approvals, etc. were necessary, and he *should have known* that. He apparently didn't know it, but he had reason why he ought to have. And the SEC can fine you for that sort of recklessness.
 
Assumption without factual basis. Quite likely the legal team told Musk they had a very strong case, but that it would take time for it all to play out, which might depress the stock in the short term. Elon weighed the benefits and risks and made a choice.
"Quite likely"? Where is your factual basis?

Everything on here is mostly opinion. Everyone should be entitled to voice theirs, don't you think?
 
No, you're not a "bad person" you're just an idiot who is unwilling to understand the congestion problem.

I prefer to refer to "mass transportation", because that's the important point from first principles. (Public vs. private is irrelevant.)

For spread-out, *low population*, *low volume* transportation, cars are great. And trains... don't really work because they don't *scale down* -- they don't make sense unless you're moving hundreds of people.

For dense, *high-population*, *high-volume* transportation, cars don't work. They don't scale up. They take up too much space per person. No, digging extra tunnels doesn't help; you still have to get in and out of the tunnels. (It's documented that people, in cars or on foot, will prefer a tunnel which is less deep simply because of the time it takes to get in and out of it!) Trains can move hundreds of people in the space where cars can move a dozen.

It is consistently, and reliably, faster to go point to point by underground trains than by *car in underground tunnel* in any major city which has both. This isn't arguable, and it's actually bloody obvious. If you've ever been through the Lincoln or Holland Tunnel and *also* through the Amtrak or PATH tunnels, you'll get it. The number of people being carried through one train tunnel is a order of magnitude higher than the number going through one lane of a car tunnel.

These modes should be cooperative. When I get to the edge of a dense city, I trade my car for a train ticket. I should also be able to get out and easily grab a rental car or taxi to head into the countryside, which I usually can't. Rural autonomous cars would make this possible, if they are ever made to work (which will take decades).

Musk is currently proposing car/minibus tunnels for *urban traffic* -- this simply isn't a solution. It doesn't work. First principles tells us it won't work, and on top of that, it's actually been tried and it doesn't work. It shows a failure to do his research, which, you know, is something he could actually *correct* with a few days' study.

----

The principles are actually similar between passengers and freight. Think about it this way: if Musk drills an underground tunnel between Tesla's seat factory and the Fremont general assembly factory -- to avoid the overground traffic problem -- which do you think he'll do?

1 -- drive individual rubber-wheeled trucks through it, carrying seats?
2 -- use some sort of physical tracks to automatically carry seats?

Even in the factory, they started out at low capacity using rubber-wheeled vehicles driving around the floor (following magnetic tape lines)... and have now, as capacity ramps up, switched more and more to pulling parts on fixed conveyor belts and tracks.

You just don't get it. The reason there's huge congestion at current rail/subway lines is because there's one place for everybody to go. The fact that a station exists causes congestion in itself, don't care about packing problem when you're trying to shove those bodies along the tracks. There's literally one choice for tens of thousands of people, and they all want to be at work at 9 am. Tunnel routes cannot be planned by humans, it will have to be done by computer, much like place and route on modern chips. It's fundamentally an algorithms problem. The depth of the tunnel scales with it's distance and it's speed. Short travel would be near surface. You will also be required to use a smart device to navigate the network, it will be otherwise impossible to understand. It also eliminates the major cause of bottlenecks on standard rail systems - too hot or too cold for the track, snow, train failure, people holding the door open too long, drunkards/masturbators/police actions, suicides. This is head-of-line blocking.

You should think more of it as elevators in a skyscraper. Elevators that go sideways. They are parallel and fast, and hold only a few people. They are also route optimized such that you don't have separate people going to the top floors from people going to the middle floors, etc. The speed of each elevator also varies with destination. Such a system in a building could handle 25,000 people getting to work, in and out of lunch, and back home everyday, without deep queueing.

Seriously man, do you want a turbolift or not? Can we make the future happen already...
 
Interesting tidbit regarding Tesla Semi. My wife has family from the Midwest, hard core right wingers that refuse to live in California because it’s a “lib state”. One of them is a full time truck driver, he said this past weekend that there is heavy buzz in the trucking community regarding the Semi, they all want one.

Well, it's driven by pure dollars and cents -- it's like with buses, it's obvious getting EV trucks ASAP makes you profits ASAP.
 
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You didn't look very hard, did you? I cited a different M&A specialist about that earlier, who agreed with mush of what Gorman said. You're a bit dishonest -- you were here for that.

The SEC definitely didn't want to take this to a jury trial. First of all, they never do; juries are a crapshoot, and they always want settlements. Second, given the timelines on jury trials, the jury would have been hearing the case in 2019 or 2020, while TSLA stock is likely to be above $420. Under those circumstances, convincing a jury that Musk deliberately "inflated" the price of the stock will be impossible. Convincing them that there was no solid financial offer will also be impossible -- because hindsight is 20/20 and everyone wants to think they were smart enough to know how much the company was worth back then.

Contrary to what most people think, "funding secured" wasn't the problem -- precedent says it doesn't mean "committed", it means merely "lined up". That part of the case was very weak.

The strong part of the SEC case was the other bits, and so Musk really needed to settle.
-- Musk *really* should have known that he couldn't keep all small stockholders in the company if it went private. If I can look this up, Musk could have too. He made a statement which he believed to be true, but *should have known* was false, had he done even a few minutes of due diligence. And the SEC can fine you for that sort of recklenessness.
-- Likewise, he should have known better than to say that a stockholder vote was the *only* remaining hurdle -- government approvals, board approvals, etc. were necessary, and he *should have known* that. He apparently didn't know it, but he had reason why he ought to have. And the SEC can fine you for that sort of recklessness.
Trials are places for faces to gain valuable exposure, but time is money. $40 million trumped going to court. Being an "M&A Specialist" myself I hardly consider myself competent to argue an SEC legal position. Guess wherever you saw that report they were scrapping the bottom of the barrel. I was looking for other expert opinions from actual SEC case attorneys.

The rest of your post justs points to how flawed Gorman's position was and why Musk's attorneys pushed to settle this and put it behind everyone involved. IMHO it was the correct move.

Neroden: Do you disagree because you think they should not have settled? That would have been a bad move. Juries are notoriously anti big-business. Obviously, Musk's people know that too.
 
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Wow, so they found a lot of 42 cars sitting and it’s a problem?

Another lot had 100 and it’s a problem?

Guess who the NYT quited? Our very own short, Mark Spiegel. LOL these guys are grasping onto straws.
Ha. LOL indeed.

I mentioned on here a week ago that the Bellevue, WA service center was preparing to ramp up from 30 deliveries to 100 deliveries a day for the final week of the quarter. They only have space for maybe 20 or 30 cars at the service center. So it's no surprise they needed someplace to stage the cars.

The "100 cars at a mall in Bellevue, WA" that the stupid NYT article references is a day's worth of cars to be delivered.

Also, I'm sure they're taking in a bunch of trade-ins. Those need to get staged someplace as well.
 
In 2014 Brent oil averaged $98.95 per dollar. This is what that looks like in other currencies (average yearly exchange rate):

109.16 AUD
232.53 BRL
109.24 CAD
90.08 CHF
609.04 CNY
74.71 EUR
64.04 GBP
10,377 JPY
681.27 SEK
98.95 USD

Here's $85 brent oil at today's exchange rates:

117.64 AUD
342.55 BRL
108.80 CAD
83.64 CHF
583.95 CNY
73.34 EUR
65.18 GBP
9,690 JPY
760.75 SEK
85.00 USD
What this says to me is that it's a pity Tesla hasn't managed to start shipping Model 3s to Europe yet. Well, soon....
 
This is something very few people have factored in.

When it starts to become most common knowledge that the EV is going to supplant ICE cars, the depreciation rates of non-autonomous capable ICE cars are going to get crazy. The collateralization model for financing cars is going to break down. You'll get much lower trade-in values, higher financing rates, and shorter terms. The amount of ICE car you can afford in terms of payments will collapse. many people who bought new ICE cars will be underwater. It would be even worse if autonomy comes along and all of the sudden the lower/middle incomes brackets and elderly switch over to it. (because one autonomous car can replace many)

This could actually become the source of a future financial crisis, IMHO.

Thread by @KashannKilson: "Ok, I’ll try and keep this brief, but lets talk PT Cruiser and the 2007 recession. FYI, I’m not *blaming* the crash on the PT Cruiser, just […]" is worth a read, on THAT subject.

Basically, a small version of this happened with the PT Cruiser, and showed the rot that led to the 2007-2008 crash. One model of car managed to show all of this.
 
Well, I wouldn't call anything in the EV industry "exponential" at this stage other than possible domestic EV battery production.
EV sales per year, globally, have followed a very reliable exponential curve for about a decade. Doubling time is about two years; growth rate per year is about 50%.

If we could get to 200K Tesla sold in 2018-2019 that would be great. It's not going to 2 million over the next five years even. Let alone some of the numbers below.
*sigh* Unless they badly fall off the exponential growth curve, Tesla will sell ~410K next year, and 1.5 million to 2 million in 2023.

World EV production in 2023 will probably be 9 million. It takes another five years to get to 70 millon. At that point it starts to become hard to predict because EVs are already dominant and getting rid of the "last few" ICE cars is harder.

There is simply no way that Tesla or anyone else is going to be able to ramp up to any numbers like that within a few years.
They'll do it.

Probably not even a decade. Forget production volume, just sheer battery elements availability could NEVER provide enough capacity in that time frame.
It's already being lined up. Mines just have to be funded.
 
You just don't get it. The reason there's huge congestion at current rail/subway lines is because there's one place for everybody to go. The fact that a station exists causes congestion in itself, don't care about packing problem when you're trying to shove those bodies along the tracks. There's literally one choice for tens of thousands of people, and they all want to be at work at 9 am.

Tens of thousands of bodies in a train station take far less space than tens of thousands of bodies in individual cars.

Here's an illustration of the space used to transport 72 people by bicycle, by car, and by bus, famously used (and recreated) by urbanists.
7999178447_e3e87542fe_o_d.jpg


Note the groups of people in each shot. Note how much space the people take.

Note the cars. Note how much space they take.
 
I would seriously consider buying game-changingly efficient Tesla residential heat pumps and non-gas-burning hot water heaters and furnaces. But I want to see 5 million Tesla cars, pickup trucks, and semis sold first.

"Tesla needs to sell Tesla branded drip coffee."

I would buy this!

I would also buy...
Tesla office chair
Tesla watch
Tesla cell phone
Tesla appliances

They could def extend out into lifestyle products, though that doesn't exactly fit into the "accelerating the advent of sustainable transport" mission. But it would be substantial revenue. Supporters of "the mission" would patronize for sure.
 
Someone please explain to me how short sellers couldn’t have hurt Tesla today.

Not obscure technicalities but substantial and realistic reasons why they couldn’t.

They could have sold any thing above open, Building a bigger position and depressing prices??

Somehow shorts can do something magically tomorrow they couldn’t do today seems fuddish?

It really is a technicality. Under the uptick rule, they're effectively not allowed to short-sell at the market price -- they can't just push the stock down and down by running through the order book. They can keep the price down to whatever it *starts* at by issuing limit orders above the current price, but can't force it down further (only "real" long sellers can do that).

Tomorrow they'll be able to dump tons of borrowed shares on the market all at once to specifically force the price down temporarily. It shows up as "icicles" on the chart, and Papafox has documented it.
 
Not that that will happen, but that's exactly why I want Tesla to change its battery upgrade policy, and start to design the smaller batteries to be able to be taken apart and upgraded and sold used, and with enough automation and ease of battery swap that it doesn't cost Tesla a lot and therefore they are able to make a profit without charging the customers a lot to upgrade. In this way, a $35,000 Model 3 could easily become a much nicer car over time. Maximize the amount of upgradable hardware for low extra upgrade cost over original fitment of such parts allowing that to go to profit. Hardware with good MTBF that customers don't see could be refurbished and put back into new cars with full warranty; Tesla could get into a situation where their less expensive high MTBF unseen hardware is almost always just refurbished. Some things like seats and interior cloth would not be upgradable in the same way, but the seats could at least allow a full-purchase price for higher options. Maybe there could be a slot in seats that makes it easy to install additional seat features such as massage, etc.. Spring ride could be designed to be easy to convert to air ride; probably, it is not easy to do right now; the springs could be refurbished and put back into new cars (since this is a rare upgrade, all of those springs could be earmarked for store loaner and test drive models which get discounts when sold anyway). Make the motor swappable for a performance motor; I think that's already true with Model 3 according to Ingineer's videos, but just facilitate it more. You could have a $35,000 Model 3 you incrementally upgraded to a performance model. Etc.

(Glass roof upgrade would be impossible since the stamped parts that allow it are welded to the other stamped parts in an exsiting car.)

But Elon has stated many times that that is a bad idea. I don't understand why he thinks that, given the potential to redesign the car to be able to make upgrades inexpensive and profitable.

Because that's an oxymoron. Upgradable things take more engineering design and usually results in some components needing more structural support than being non-upgradable. It's a pipe dream to think that making something upgradable automatically means you can make it affordable.
 
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