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Long-Term Fundamentals of Tesla Motors (TSLA)
- Thread starter Robert.Boston
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- elon is an ass investing TSLA
JRP3
Hyperactive Member
Not so sure about that, plenty here in the US seem to love to show off their riches, even if they don't really have them. There is a whole culture of living beyond their means that's entirely based on showing off. The phrase "keeping up with the Joneses" comes to mind.
There are two types of rich, the neuvo riche and the old money. Old money is a lot less likely to flash their wealth than new money. I grew up near San Marino, CA in the Los Angeles area and then there was Beverly Hills on the other side of town. San Marino's wealth per capita was much higher than Beverly Hills, but you wouldn't believe it if you didn't know what to look for. The most common car was a Cadillac and the houses were on large lots, but they were set back from the street with lots of screening trees. In many cases even seeing the house from the street was difficult. The main shopping area in San Marino is upscale, but far from lavish.
Beverly Hills is all about flash and making everyone seeing your wealth.
RobStark
Well-Known Member
It is all about proportions. New money everywhere wants to show off wealth whereas old money wants to hide it. Almost all Chinese money is new money. And large portions of new money in the West from the Mandarin Class wants to pretend they are old money.
So we get the constant harping on TMC about people not wanting to drop off their kids at school opening up their falcon wing doors. Or at least we used to until Tesla made in very clear there will be no conventional doors on the Model X.
The disdain implicit in the phrase "keeping up with the Joneses" and rants against "American Consumerism" is old money culture scolding the nouveau riche about being flashy. You don't see this in China or India. In India the desire for gold jewelry is so high the government has gotten involved because it impacts balance of payments.
Rappers, Ballers and $50k/year salarymen pretending to be rappers and ballers not withstanding.
I wouldn't be surprised that the favorite car in San Marino is different now. I moved away from the San Gabriel Valley in 1984 and never looked back.
Bill Maher last Friday commented in his New Rules about people talk about rare and exotic cars in Beverly Hills like Maseratis and Lamborghinis and that those cars aren't rare or exotic and if someone really wanted to drive a rare and exotic car in Beverly Hills, drive a 1984 Buick Electra station wagon.
The cars in San Marino aren't all that cheap, but they don't scream "I'm loaded, look at me!" Upper end German cars would fit with the San Marino esthetic as would the Model S.
I don't think Tesla ever had much of a technological edge. What I think Tesla has is a *psychological* edge.
Technologically speaking, any carmaker could have made a battery-elecrtric car with 200+-mile range and fast charging, and built a Supercharger network. Any carmaker could have done this using Tesla's "Secret Master Plan" business model, which Tesla actually *published*. Any carmaker could have thermally managed the batteries; any carmaker could have used the "skateboard" design with the batteries on the bottom of the car; any carmaker could have had a frunk; any carmaker could have put 100% of the regenerative braking on the accelerator pedal. Any carmaker could have made this car look cool.
*But they didn't*, and *they still aren't doing so*. Because they are psychologically trapped. They are just now starting to make potential competitors to the Model S, years too late; GM and Nissan may finally be making potential competitors to the Model 3, but they're still making mistakes and they seem to be late (Nissan: thermal management and fast charging; GM: fast charging and charging network). Meanwhile, Tesla is already talking about an all-electric pickup truck and it appears none of the other carmakers are even thinking about that. Tesla's psychological advantage has them staying several years ahead. The only serious competition comes from the Chinese carmakers, who are not psychologically trapped in an old business paradigm, but they're having trouble moving into the EU and US markets.
What's brilliant about Musk from a business perspective is that he didn't finance Tesla until it was *clear* that the other carmakers were not going to compete with him -- he waited until *after* GM crushed the EV1 and Toyota recalled the RAV4-EV.
Tesla Energy doesn't have the same psychological advantages, but it does have *some* psychological advantages. All the other battery companies have been saying "How did Musk get so much attention"? He's created massive brand value for Tesla Energy while providing a competitive product. The turnkey nature of the PowerPack, and its easy size-expansion, is extremely valuable from a marketing perspective. I'm not sure how long it'll take a competitor to make something similar.
Musk has also been brilliant in business in a subtle way which few have recognized. Rather than doing market research, he announces several variants of a product (Powerwall daily-cycle and Powerwall weekly-cycle, or Model S 40, 60, and 85), and then counts reservations to figure out where the demand is. This is how Tesla figured out how much range people want in in their cars -- it's the best possible market research *and it cost Tesla nothing*. Amazingly, other car companies are still not paying attention to the lessons from Tesla's market research, even though the results are not at all confidential!
In the Energy business, Musk figured out by exactly this method -- experimentation by a publicity blitz and counting reservations -- that the big-money applications for batteries were utility, industrial, and large commercial. Apparently the competitors have not managed to make a solid turnkey product in these markets yet. Another thing about the PowerPack is that the R&D was already paid for: they did the R&D and debugging already in order to put batteries at the Supercharger sites. A competitor would probably not have that synergy.
I was thinking about automation of the production line the other day. We know Tesla's automated as much as they can. I wonder which parts are still non-automated?
I'm guessing wire runs and trim. There's *got* to be some way to automate wire runs -- some equivalent of replacing wire-wrapped breadboards with printed circuit boards. I wonder if Tesla is working on this, because it would be a big deal for cost and production line speed.
Trim is theoretically automatable, but as far as I know, you don't get the quality of a human without slowing it down to be as slow as a human, so it may not be worth the effort. However, for wire runs, automatic attachments could be *more consistent and reliable* than a human while being quite fast...
I'm guessing wire runs and trim. There's *got* to be some way to automate wire runs -- some equivalent of replacing wire-wrapped breadboards with printed circuit boards. I wonder if Tesla is working on this, because it would be a big deal for cost and production line speed.
Trim is theoretically automatable, but as far as I know, you don't get the quality of a human without slowing it down to be as slow as a human, so it may not be worth the effort. However, for wire runs, automatic attachments could be *more consistent and reliable* than a human while being quite fast...
All technology is built on top of existing technology. Tesla did nudge the tech a bit, but I largely agree that most of what they did was available and their brilliance was putting it together in a novel way.
My favorite part of today's Conf call
1. Elon describing the goal of Tesla becoming world leading manufacturer of large complex object. He specifically did not use the word car.
2. Elon saying that SpaceX is less complicated to run than Tesla!
I think we have only seen the first three or four chapters of Tesla
1. Elon describing the goal of Tesla becoming world leading manufacturer of large complex object. He specifically did not use the word car.
2. Elon saying that SpaceX is less complicated to run than Tesla!
I think we have only seen the first three or four chapters of Tesla
I agree that the first point above in particular was very important. And Elon emphasized that theme in various ways throughout the discussion -- from his desk and sleeping bag on the assembly line, to distinguishing Tesla from Apple and Google because Tesla likes to build things and they don't, to emphasizing that manufacturing IP is very important to Tesla and will give it an edge.
Tesla has so many strengths but manufacturing has not been one of them. Elon sounds like he has put his mind to transforming Tesla into the best manufacturing company in the world. Given the inherent advantages EVs have due to fewer moving parts, this could be the final piece of the puzzle for the EV business. And then, on to other "large complex objects" ....
I was very encouraged to hear Elon's comments on the conference call yesterday. Specifically that Tesla is taking manufacturing very seriously, has set a goal of becoming the best company at manufacturing prowess in the world, and is hiring the top people in the field. Elon even said that manufacturing prowess is even more important than product design, and the Model 3 will be strictly designed for manufacturing, as well as to be a highly desirable car.
I strongly believe this is exactly where Tesla's focus needs to be at this time. To hear they are doing exactly what I think is needed to for them to survive and to thrive is hugely encouraging to me. I am so glad I stood in line at Tesla's store before they opened on March 31st. They will make excellent use of my deposit, much better use than the bank!
GSP
I strongly believe this is exactly where Tesla's focus needs to be at this time. To hear they are doing exactly what I think is needed to for them to survive and to thrive is hugely encouraging to me. I am so glad I stood in line at Tesla's store before they opened on March 31st. They will make excellent use of my deposit, much better use than the bank!
GSP
Johan
Ex got M3 in the divorce, waiting for EU Model Y!
Elon's focus on manufacturing, both efficiency and the ability to ramp quickly/scale the process ties in to his over arching goal: to accelerate the process of moving humanity from a single planet to a multi planetary species. In order to do this one must master the process of assembling large amounts of matter in to complex organization. The other main concept that must be mastered is that of capturing/controlling/harvesting as much energy as possible from our star (the sun). Elon has his eyes on the price when it comes to this objective as well, with solar + storage.
It may sound grandiose but thinking about it it's obvious that everything he does in the longer perspective converge toward these goals.
It may sound grandiose but thinking about it it's obvious that everything he does in the longer perspective converge toward these goals.
Ulmo
Active Member
I just had another one of my "but what the hell ..." questions answered today when I realized a company selling new shares of an existing company to raise capital dilutes existing shares. So, in other words, when a company sells more shares, they're taking people who already owned shares in the company and saying that they hadn't invested enough yet, and therefore they shouldn't get as much return as they would have if they had invested more. To peg this down, so I know where my score card is and what my planning should be for the future, what is the history of capital raises by Tesla? Does SEC have a nice graph or bar char or something, or is it all buried in verbose filings?
Is this right?
That looks very healthy to me.
I'm Googling "capital raise Tesla", and found one around August 25, 2015, and that corresponds to a document on the SEC web site named "Prospectus". It was a very clear document explaining what they were about to do. But, then, when I continued to look for other documents named "Prospectus", they were very confusing, talking about notes for amounts with blank quantities. Are those shares sold at current price to meet those amounts?
Here's the list I see:
Aug 14, 2015
Prospectus Supplement to Prospectus dated May 15, 2013
2,694,934 Shares
Aug 13, 2015
SUBJECT TO COMPLETION, DATED AUGUST 13, 2015
Prospectus Supplement to Prospectus dated May 15, 2013
2,100,000 Shares
Feb 28, 2014
0.25% Convertible Senior Notes due 2019 $920,000,000
1.25% Convertible Senior Notes due 2021 $1,380,000,000
Common Stock, $0.001 par value per share
Feb 26, 2014
Tesla Motors, Inc.
$800,000,000 Convertible Senior Notes due 2019
$800,000,000 Convertible Senior Notes due 2021
Interest payable March 1 and September 1
May 17, 2013
1.50% Convertible Senior Notes due 2018 $660,000,000
Common Stock, $0.001 par value per share
May 17, 2013
Common Stock, $0.001 par value per share
3,902,862 $92.24 $359,999,990.88
---
Wait, so am I reading this right? If they don't pay their loan, they give the banks, for instance, in that last one due 2018, 660,000,000,000 shares in the company, diluting the current stock to basically nothing and giving the bank full control of the company through voting rights? Is that the definition of bankrupt?
---
May 15, 2013
SUBJECT TO COMPLETION, DATED MAY 15, 2013
Prospectus Supplement to Prospectus dated May 15, 2013
$450,000,000
% Convertible Senior Notes due 2018
Interest payable June 1 and December 1
May 15, 2013
SUBJECT TO COMPLETION, DATED MAY 15, 2013
Prospectus Supplement to Prospectus dated May 15, 2013
2,703,027 Shares
This is a public offering of shares of common stock of Tesla Motors, Inc.
Tesla is offering all of the shares to be sold in the offering.
Our common stock is traded on the Nasdaq Global Select Market under the symbol “TSLA.” The last reported sale price of our common stock on May 14, 2013, as reported on Nasdaq, was $83.24 per share.
Mr. Elon Musk, our Chief Executive Officer and Chairman of our Board of Directors, has indicated his preliminary interest in purchasing up to an aggregate of 1,201,345 shares of our common stock for an aggregate purchase price of approximately $100 million, of which 540,605 shares of our common stock would be purchased in this offering at the public offering price, for a purchase price of approximately $45 million, and of which 660,740 shares of our common stock would be purchased directly from us at the public offering price in a subsequent private placement, subject only to necessary regulatory approvals, for an additional purchase price of approximately $55 million.
Concurrently with this offering of common stock and pursuant to a separate prospectus supplement, we are offering % convertible senior notes due 2018, or the notes, to the public in the aggregate principal amount of $450,000,000 (or $517,500,000 if the underwriters for the concurrent notes offering exercise in full their over-allotment option to purchase additional notes). The closing of this offering of common stock is not contingent upon the closing of the concurrent offering of notes, and the closing of the concurrent offering of notes is not contingent upon the closing of this offering of common stock.
---
What all this tells me is that there is a LOT of detail in each one of those filings.
---
Sep 28, 2012
6,925,740 Shares
Sep 25, 2012
4,344,930 Shares
Jun 3, 2011
5,300,000 Shares
Jun 29, 2010
13,300,000 Shares
Common Stock
This is an initial public offering of shares of common stock of Tesla Motors, Inc.
Tesla Motors is offering 11,880,600 of the shares to be sold in the offering. The selling stockholders identified in this prospectus are offering an additional 1,419,400 shares. Tesla Motors will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders.
Prior to this offering, there has been no public market for the common stock. The initial public offering price per share is $17.00.
===
I put the above in a spreadsheet and got 41,271,493 shares. According to other sources, $TSLA has ... ok, I finally found the right way to search. "Outstanding Shares", which shows around 132 million:
Tesla Motors Shares Outstanding (TSLA)
According to that graph, it steadily rises. So, do they pay off executives, who then buy homes with money and cash it in by liquidating the stock into the stock market, and that's the capital raises, basically discounting their payroll as the capital raise? That's a drop in the bucket ... or should be. Hmm
Now, I'm finally getting better Google foo. I read about "authorized shares" vs "outstanding shares". How many shares were Authorized for Tesla? If it's more than the outstanding, then Tesla can just willy nilly raise cap whenever it feels like it, in dribs and drabs, here and there, or in huge chunks, too.
Is this right?
That looks very healthy to me.
I'm Googling "capital raise Tesla", and found one around August 25, 2015, and that corresponds to a document on the SEC web site named "Prospectus". It was a very clear document explaining what they were about to do. But, then, when I continued to look for other documents named "Prospectus", they were very confusing, talking about notes for amounts with blank quantities. Are those shares sold at current price to meet those amounts?
Here's the list I see:
Aug 14, 2015
Prospectus Supplement to Prospectus dated May 15, 2013
2,694,934 Shares
Aug 13, 2015
SUBJECT TO COMPLETION, DATED AUGUST 13, 2015
Prospectus Supplement to Prospectus dated May 15, 2013
2,100,000 Shares
Feb 28, 2014
0.25% Convertible Senior Notes due 2019 $920,000,000
1.25% Convertible Senior Notes due 2021 $1,380,000,000
Common Stock, $0.001 par value per share
Feb 26, 2014
Tesla Motors, Inc.
$800,000,000 Convertible Senior Notes due 2019
$800,000,000 Convertible Senior Notes due 2021
Interest payable March 1 and September 1
May 17, 2013
1.50% Convertible Senior Notes due 2018 $660,000,000
Common Stock, $0.001 par value per share
May 17, 2013
Common Stock, $0.001 par value per share
3,902,862 $92.24 $359,999,990.88
---
Wait, so am I reading this right? If they don't pay their loan, they give the banks, for instance, in that last one due 2018, 660,000,000,000 shares in the company, diluting the current stock to basically nothing and giving the bank full control of the company through voting rights? Is that the definition of bankrupt?
---
May 15, 2013
SUBJECT TO COMPLETION, DATED MAY 15, 2013
Prospectus Supplement to Prospectus dated May 15, 2013
$450,000,000
% Convertible Senior Notes due 2018
Interest payable June 1 and December 1
May 15, 2013
SUBJECT TO COMPLETION, DATED MAY 15, 2013
Prospectus Supplement to Prospectus dated May 15, 2013
2,703,027 Shares
This is a public offering of shares of common stock of Tesla Motors, Inc.
Tesla is offering all of the shares to be sold in the offering.
Our common stock is traded on the Nasdaq Global Select Market under the symbol “TSLA.” The last reported sale price of our common stock on May 14, 2013, as reported on Nasdaq, was $83.24 per share.
Mr. Elon Musk, our Chief Executive Officer and Chairman of our Board of Directors, has indicated his preliminary interest in purchasing up to an aggregate of 1,201,345 shares of our common stock for an aggregate purchase price of approximately $100 million, of which 540,605 shares of our common stock would be purchased in this offering at the public offering price, for a purchase price of approximately $45 million, and of which 660,740 shares of our common stock would be purchased directly from us at the public offering price in a subsequent private placement, subject only to necessary regulatory approvals, for an additional purchase price of approximately $55 million.
Concurrently with this offering of common stock and pursuant to a separate prospectus supplement, we are offering % convertible senior notes due 2018, or the notes, to the public in the aggregate principal amount of $450,000,000 (or $517,500,000 if the underwriters for the concurrent notes offering exercise in full their over-allotment option to purchase additional notes). The closing of this offering of common stock is not contingent upon the closing of the concurrent offering of notes, and the closing of the concurrent offering of notes is not contingent upon the closing of this offering of common stock.
---
What all this tells me is that there is a LOT of detail in each one of those filings.
---
Sep 28, 2012
6,925,740 Shares
Sep 25, 2012
4,344,930 Shares
Jun 3, 2011
5,300,000 Shares
Jun 29, 2010
13,300,000 Shares
Common Stock
This is an initial public offering of shares of common stock of Tesla Motors, Inc.
Tesla Motors is offering 11,880,600 of the shares to be sold in the offering. The selling stockholders identified in this prospectus are offering an additional 1,419,400 shares. Tesla Motors will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders.
Prior to this offering, there has been no public market for the common stock. The initial public offering price per share is $17.00.
===
I put the above in a spreadsheet and got 41,271,493 shares. According to other sources, $TSLA has ... ok, I finally found the right way to search. "Outstanding Shares", which shows around 132 million:
Tesla Motors Shares Outstanding (TSLA)
According to that graph, it steadily rises. So, do they pay off executives, who then buy homes with money and cash it in by liquidating the stock into the stock market, and that's the capital raises, basically discounting their payroll as the capital raise? That's a drop in the bucket ... or should be. Hmm
Now, I'm finally getting better Google foo. I read about "authorized shares" vs "outstanding shares". How many shares were Authorized for Tesla? If it's more than the outstanding, then Tesla can just willy nilly raise cap whenever it feels like it, in dribs and drabs, here and there, or in huge chunks, too.
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Any company that does an offering of shares changes the stock price very little. Yes, there's dilution in the percentage of the company that you own, but the company just brought in more cash at a price comparable to the current market price, so the price will change very little. If anything, the investors will believe that the extra cash is going to be put to good use, and this should be reflected in the stock price going up!
A long term investment concern is one of service centers. Before this forum grew, I knew what latches were having problems on the model s , and all the minutiae around Tesla. Now I am lucky if I can read the short-term investment thread at the end of my day. Point being I find 'non-investment' threads, equally as important as investment ones, and there are people who are not satisfied with service. Also the wait list for service seems to be growing (albeit hard to thrash out effect of model x recall). Even if Tesla puts out 500 000 vehicles on time, If there is a major recall, or major problem, I fear they will woefully in addressing it timely. A few grumblings, turn into a lot, and next thing you know is people (non-Tesla addicts like ourselves) saying they will never buy another Tesla as they are renting a car for 2 weeks to get it serviced! A persistent negative service experience can drastically hurt a company for years, and the less service centers you have, the higher chance of this scenario playing out.
Another concern I have is the exodus of VP's . I think that is four in four months. I still prefer to see long-term 'entrenched' employees who know the ins and outs of a company, rather than the Silicon Valley Shuffle. If someone slept beside me to monitor me though, I probably would get up and go as well. Hopefully Tesla is 'grooming' some people from the inside for more vertical alignment and growth from within, than horizontal patch filling.
Another concern I have is the exodus of VP's . I think that is four in four months. I still prefer to see long-term 'entrenched' employees who know the ins and outs of a company, rather than the Silicon Valley Shuffle. If someone slept beside me to monitor me though, I probably would get up and go as well. Hopefully Tesla is 'grooming' some people from the inside for more vertical alignment and growth from within, than horizontal patch filling.
sundaymorning
Active Member
A long time ago I had the opportunity to chat with George Blankenship, a tesla executive. He explained that launching and landing rockets are challenging, but it's not as challenging as starting a car company. He explained his logic this way: when dealing with space, there are set laws that are constant, so long as you know what those laws are, you can solve them. Nature, to a certain extent, is predictable.
My SO has a Masters in Psych and is an attorney. She wrote lots of papers in college. We were talking about the difference between science and engineering classes and other classes the other day. I pointed out that most of what you do in the hard sciences and engineering classes has an objectively provable right answer. If you get the right answer and show your work, even if the professor hates you, you still get the A. With classes that require papers, the professor's opinion of you can affect your grade, no matter how well you know the subject.
Going up against the laws of Physics is much more predictable than going up against the rules/laws of humans. With the latter, the goalposts can constantly move. With the former, you may get to a point where what you're trying to do is beyond the technology available, or you may learn that we misunderstood the science, but ultimately the goalposts are fixed.
It's the nature of the different subjects. Tesla is a tech company, but they are building technology that has to fit into a web of existing laws and regulations. SpaceX is operating on the frontiers where there are few laws and the challenges have much more to do advancing the technology to new levels than working within any framework created by humans, though there are some laws they need to deal with.
Going up against the laws of Physics is much more predictable than going up against the rules/laws of humans. With the latter, the goalposts can constantly move. With the former, you may get to a point where what you're trying to do is beyond the technology available, or you may learn that we misunderstood the science, but ultimately the goalposts are fixed.
It's the nature of the different subjects. Tesla is a tech company, but they are building technology that has to fit into a web of existing laws and regulations. SpaceX is operating on the frontiers where there are few laws and the challenges have much more to do advancing the technology to new levels than working within any framework created by humans, though there are some laws they need to deal with.
Many congrats to the SpaceX team for the ultimate 1st stage recovery-
[nighttime Geo orbit- 1st stage re-entry 3 times faster and much higher requiring 3 burns-
even so twice the speed at Of-Course-I-HEART-U -
Saving NASA (tax payers) millions with data share on super-sonic entry program. Mars ever closer]
U-S-A Go SpaceX
Meantime Elon catching flak for audaciously advancing the effort to save the planetary habitat we're currently stuck with. For less $s than we each spend on our current ICE-machines. Now with Coal eliminated moving to Oil. So needing to raise all of a $1B to effectively double the size of our return and value of our stock. Damn him.
All the while, our newly formed Republican party leader hiring a new national finance chair, (Steven Mnuchin of 2008 IndyMac fame), to raise the same $1B in an effort to install said new leader of the free world- who is currently promising to return Coal to it's former glory and put the miners back into the coal mines where they belong- 'Trump Digs Coal'.
In fairness, he didn't say what they would be doing down there-
trolling for diamonds perhaps.
Ya gotta admit- if nothin' else, the human race loves a good party;
I can see why Elon wants to die on Mars...
[nighttime Geo orbit- 1st stage re-entry 3 times faster and much higher requiring 3 burns-
even so twice the speed at Of-Course-I-HEART-U -
Saving NASA (tax payers) millions with data share on super-sonic entry program. Mars ever closer]
U-S-A Go SpaceX
Meantime Elon catching flak for audaciously advancing the effort to save the planetary habitat we're currently stuck with. For less $s than we each spend on our current ICE-machines. Now with Coal eliminated moving to Oil. So needing to raise all of a $1B to effectively double the size of our return and value of our stock. Damn him.
All the while, our newly formed Republican party leader hiring a new national finance chair, (Steven Mnuchin of 2008 IndyMac fame), to raise the same $1B in an effort to install said new leader of the free world- who is currently promising to return Coal to it's former glory and put the miners back into the coal mines where they belong- 'Trump Digs Coal'.
In fairness, he didn't say what they would be doing down there-
trolling for diamonds perhaps.
Ya gotta admit- if nothin' else, the human race loves a good party;
I can see why Elon wants to die on Mars...
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