I doubt they are bluffing.
You realized that Tesla recently cancelled all contracts (as far as possible) with other companies and wants Grohmann to work 100% for Tesla and that this is a main reason for the change of mentality among the employees?
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MitchJi
Trying to learn kindness, patience & forgiveness
It's actually better for Tesla to maximize profits, which they can do by a combination of maximizing sales, by reducing their prices while maintaining their margins.
Because they will be charging much less for the identical upgrades on the M3. Namely battery pack and AP. The AP upgrades will cost them less due to the economics of amortizing the costs of software over a much larger number of sales, which will reduce their hardware prices as well. 2170's produced at scale will also reduce their costs, plus (score one for Rob) lead to 7.5% larger pack capacity. I'm not sure when they will make the cell switch, but I recently became suspicious of the fact that they have been very vague when responding to questions about the timing. How would you feel about continuing to pay more for AP on a MS-MX vs an M3? In any case Rob thinks that they will deal with this issue solely by upgrades. It's similar to what I believe, except that I think that they are also planning a $5-$8k reduction in the price of popular options which would have a huge positive impact on the sales of the MS-MX. In any case we'll know within 3-5 months. If they maintain constant margins the question isn't if they reduce prices but when, because in addition to eventual pack price reductions they will have cost reductions from transitioning to alien dreadnaught production for the MS-MX.
I'd really appreciate an answer to my original question!
MitchJi
Trying to learn kindness, patience & forgiveness
Respectful question.
Why do you believe that that reason will have any impact on the eventual outcome?
First of all I think the change in operations was more a catalyst for employees to think even more about their future. Now it wasn't just a name change, but an actually change in which direction the company is heading and what they will be working on.
I think the main question in the room is now simply how committed will Tesla be to Grohmann in the future. Before it was said they would still supply other companies and that would result in R&D and so on, now one has to wonder (at least I would) does Tesla really want to set up their big vision of a automated factory so far away from their headquarters in the US? Are they going to get investments or will the R&D be done in California? Does Tesla even have enough demand themselves in the long run or is this now just a short peak?
One of the Union negotiators also said something like what if the gamble on electric cars goes wrong, which is a bit silly at this point, but some of the workers might see it more of a what if Tesla doesn't make it and then we no longer have the contracts with other companies to fall back on.
Reciprocity
Active Member
They are fulfilling current contracts and not taking on any new clients. But still threatening a work stoppage, which I would assume would be soon and not after they fulfill all outstanding contracts, though I could be wrong. Either way, it's pure dumbassery driven my Union thugs or EU government, really no difference as dumb is dumb and all under the guise of helping the employees.
Reciprocity
Active Member
This is exactly what Rob Stark said. Higher margins on lower cost, higher volume car vs low price causing lower margins on lower volume car.
racer26
Active Member
We've known that all weekend. Old news.
Honestly, I think the Grohmann stuff is all inconsequential. It will blow over with little actual impact.
When Senators McCarthy and Nixon along with other China baiters were setting fire to the State Department, I was privileged to go to the United Nations with other high schoolers from the greater New York area. We had presentations from the stage about their countries by several foreign students our age. The statement by a young woman from Thailand sticks in my mind: "We are taught to think about everything we say and not to say everything we think."
Some of you may agree that Asia is probably the focus of importance in this century both economically and politically just as the United States and Europe was in the last, for better or worse. Though I am loath to generalize about civilizations it is possible that in many Asian countries politeness is considered a manly virtue, as it was taught to me by classic mid-western parents who would not have derided it as politically correct. Is civility politically suspect?
We need some grown-ups in Washington.
Some of you may agree that Asia is probably the focus of importance in this century both economically and politically just as the United States and Europe was in the last, for better or worse. Though I am loath to generalize about civilizations it is possible that in many Asian countries politeness is considered a manly virtue, as it was taught to me by classic mid-western parents who would not have derided it as politically correct. Is civility politically suspect?
We need some grown-ups in Washington.
It sounds like its only 680 workers and they are asking for 400 more euros a month while Tesla is offering 150 more euros. So the disagreement is over 680 x (400-150) x 12 = 2,040,000 euros per year.
That's a rounding error compared to what's at stake and my guess is this will be a non-issue as well.
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Re Grohmann:
The money here is really small. 400 euros for 680 employees, over a year is less than 3.5 million euros. Negotiations will go on without a strike and Tesla might eventually give then most of what they want. May be a little bit in stock.
This should blow over quick, but the shorts will leverage this to the hilt to make a lot of noise. Any dips on this FUD would be opportunity to get in.
Edit: SD beat me!
The money here is really small. 400 euros for 680 employees, over a year is less than 3.5 million euros. Negotiations will go on without a strike and Tesla might eventually give then most of what they want. May be a little bit in stock.
This should blow over quick, but the shorts will leverage this to the hilt to make a lot of noise. Any dips on this FUD would be opportunity to get in.
Edit: SD beat me!
I assume US Tesla employees will be watching. At least here, employees seem to appreciate the stock options.
Waiting4M3
Active Member
If Grohmann people don't trust in a long term future with Tesla, maybe it would be better for Tesla just pay them a few extra million euros for a few years, spend the time to transfer the work to the US and close shop over there, instead of offering stock options to them and dilute PPS
and then what? they will move to EU and look for jobs there? I know German coworkers get 5 weeks of vacation instead of 3 here, but I'm not leaving my job for that. Sure they can look at UAW, but in the end the math is the same, if they can get a better deal being with UAW, they would've done it already, what people gets paid in the EU will have little to do with this.
Agreed that the grohman situation will be scrutinized. If those folks get the increased wages they asked for, then that just might embolden the UAW more. The UAW might even highlight that as their rallying cry, "unionize and get higher pay!".
This is all short term optics and will only impact this week. Once the grohman situation is resolved, it won't matter, but until then, the shorts will be milking this.
Full disclosure, my 265 call options got called out 2 weeks ago. Just looking for opportunity to deploy some dry powder.
Could Tesla be looking for some easy money to add to the Q2 numbers?
60 > 75 Upgrade now $2k
X60D Range Upgrade to 75 price reduced!
60 > 75 Upgrade now $2k
X60D Range Upgrade to 75 price reduced!
I strongly suspect that if Model 3 roll-out is reasonably well this year we will see GF 3 & 4 break ground next year with partial production started in 24 months. By the end of 2020 Tesla could have 3 battery / car plants and a 4th solar plant. Elon takes big strides and has said that the planet needs something like 100 GF. I suspect he wasn't just pulling a number out of thin air.
If the planet needs 100, well, you better not build them one at a time.
If the planet needs 100, well, you better not build them one at a time.
Offering long term zero interest terms is a lot like Solar City's PPAs, which they are busy getting out of... If they did do this they would want a separate financing company. Which is possible, GM does it.
Looks like the the S75 got a substantial price cut in the Design Studio. Now starts at $69.5k with the auto liftgate included.
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