2017 Investor Roundtable:General Discussion

[RobStark]

To me that would mean Tesla would have to maintain at least a 15% price advantage vs. competitors.

Access to the Supercharger Network makes the car at least 15% more valuable.

Even if you have access to home and work charging and never drive long distances, access to the Supercharger Network greatly helps resale value.

 

[ValueAnalyst]

I am thinking they will, but I am not sure. I am positive they will sell every car they produce, but doing that AND staying above 25% is obviously much more difficult. To me that would mean Tesla would have to maintain at least a 15% price advantage vs. competitors.

So, selling all they make I would give near 100%, but adding that high of a gross margin, makes it that much more difficult (in 4-5 years time).

I’m hoping Alien Dreadnought tech will enable this.

For the next five to seven years, lower fueling/maintenance costs and higher performance/safety of EVs vs. ICE alone does the job, but after that:

1. Brand
2. Alien dreadnaught
3. Supercharger network
4. Longer range (battery chemistry)
5. Gigafactories at multiple continents
6. End-to-end renewable energy solution

Tesla has at least five years before "competitors" can scale up production of compelling all-electric cars. It's just a matter of time before market participants realize this, and I think they already have started to do so.

This is Tesla's game to lose at this point.

 

[Reciprocity]

I just have to correct this little bit of misinformation or misunderstanding. The lead up to Y2K was, yes, a roar of FUD, but also for the decade prior a HUGE amount of work went into correcting databases and programs that had been designed for only a 2-digit year. It was only because of that intense work did 2000 come in "with a whimper". And the work wasn't cheap.

This was an extremely successful project by many companies, by many systems people, across the globe. Kudos to them! Of course there were those who, in the days following the century change, immediately spouted off saying "See! There was no problem and we didn't need to do all that work!". Yeah, but there sure would have been problems had all that work not taken place.

Oh it's not going to be cheap for VW, Audi, BMW and Daimler either. Something like 84B committed by VW supposedly. It's going to be a lot of work to canabolizing their own profits.

 

[ValueAnalyst]

Is everyone expecting Tesla Hypercharger and the pickup truck at the Semi event?

 

[Alketi]

Is everyone expecting Tesla Hypercharger and the pickup truck at the Semi event?

Parallel supercharging and something is going to roll off of the back of the tractor trailer while this plays over the loudspeakers...

 

[dirtyofries]

Well this would certainly be something...if true.

 

[sundaymorning]

.Dealers dont want to sell BEVs because they cant make any money servicing them.

Car dealers will often sell a brand new car for only $200-$500’profit. That won’t contribute much to paying rent, employees, electricity, etc. Servicing the car is where the money is for dealers. This is why they are fighting so hard against Tesla. They want consumers to buy inferior products so they can profit.

 

[vgrinshpun]

It is two sides of the same coin. A better car at the same price point is a pricing advantage.

Edit: Vs. either of those two, I would say Tesla enjoys a very substantial price advantage. Will they vs. Porsche MissionE? Or future competition? I think so.

Sure.

But my point was that I did not see Tesla margin affected by the other EVs for a very long time, because they will not be competitive to Tesla's EVs. If I understood you correctly, you, on the other hand, were concerned that presence of other EVs on the market could pressure Tesla's gross margins.

 

[Oil4AsphaultOnly]

Ex-workers sue Tesla over racist drawings, slurs at Fremont factory

I'm not dismissing these workers' claims outright, but the fact that they didn't file complaints with the federal Equal Employment Opportunity Commission or the state Department of Fair Employment and Housing is suspicious to say the least.

First impression is that it smells of the usual FUD train the shorts are riding.

WTF, they were working as "elevator operators"?!?! Were there office ladies on typewriters too?

 

[BioSehnsucht]

I just have to correct this little bit of misinformation or misunderstanding. The lead up to Y2K was, yes, a roar of FUD, but also for the decade prior a HUGE amount of work went into correcting databases and programs that had been designed for only a 2-digit year. It was only because of that intense work did 2000 come in "with a whimper". And the work wasn't cheap.

This was an extremely successful project by many companies, by many systems people, across the globe. Kudos to them! Of course there were those who, in the days following the century change, immediately spouted off saying "See! There was no problem and we didn't need to do all that work!". Yeah, but there sure would have been problems had all that work not taken place.

Hopefully we'll be ready for 2038 before 2030.

 

[ValueAnalyst]

Car dealers will often sell a brand new car for only $200-$500’profit. That won’t contribute much to paying rent, employees, electricity, etc. Servicing the car is where the money is for dealers. This is why they are fighting so hard against Tesla. They want consumers to buy inferior products so they can profit.

True, but I think we should start distinguishing between new and used car dealers. Very different business models.

What matters primarily for this discussion is franchised new car dealerships, which make their money on service.

 

[pGo]

Tesla Model 3 doesn’t come with free Supercharger credits like Model S and Model X

This is a change.

 

[Lessmog]

Hopefully we'll be ready for 2038 before 2030.

IIRC, a few years ago Air Traffic Control closed down all traffic in California because for the first time, all the servers had been running for long enough to soon count to 65,535 seconds or whatever the rollover was, so the fear was that there would be planes airborne which looked like they took off weeks before, or perhaps some time in the future. Another kind of Y2k bug. Unpredictability is not a good thing in that line of work. Better to ground all planes and do a controlled reboot.

Not sure how the solution worked later ...

 

[LoL Rick]

Very informative article by Tesla's former VP of Manufacturing. Some good stuff in there describing Tesla's competitive advantage.

Inside Tesla's Secret Second Floor | Backchannel

 

[Mkorpal]

Tesla Model 3 doesn’t come with free Supercharger credits like Model S and Model X

This is a change.

How is it a change?

 

[dirtyofries]

How is it a change?

To my knowledge - it isn't. I don't think Tesla ever stated what the 3 would get - people just made a lot of assumptions.

 

[Lessmog]

How is it a change?

Like, it's unlike the other two?

 

[bro1999]

To my knowledge - it isn't. I don't think Tesla ever stated what the 3 would get - people just made a lot of assumptions.

Elon previously promised "free long distance Supercharging". I guess that went out the window after the bean counters came back to him.

“Model 3 from the beginning we said free charging is not included in the Model 3;free unlimited charging is not included, so free long distance is, but not free local. It becomes really unwieldy for people to use the gas station approach for electric cars; cars should really be charged where you charge your phone, but then you just need to solve the long distance problem which is what the supercharger stations will do.”
Elon Musk: Tesla Model 3 Will Get Free Long Distance Charging, But Not Free Local

 

[mrdoubleb]

Like, it's unlike the other two?

So is the price of the car.

 

[dirtyofries]

Elon previously promised "free long distance Supercharging". I guess that went out the window after the bean counters came back to him.

“Model 3 from the beginning we said free charging is not included in the Model 3;free unlimited charging is not included, so free long distance is, but not free local. It becomes really unwieldy for people to use the gas station approach for electric cars; cars should really be charged where you charge your phone, but then you just need to solve the long distance problem which is what the supercharger stations will do.”
Elon Musk: Tesla Model 3 Will Get Free Long Distance Charging, But Not Free Local

Good find, didn't recall this.

I sort of wonder if this will actually still happen when customer cars really start rolling out. Right now I don't count anything as normal since it's really just the employee vehicle. I don't think all the ducks are in a row yet.