Long-Term Fundamentals of Tesla Motors (TSLA)

[JRP3]

The very definition of compulsion. You can't stop clicking the link and watching. I can't help but point this out to you. The moderator can't help but move both our posts to snippy thread.

I'm not clear on your point. Until I clicked the link I didn't know he was the same guy who spams SA with his crappy videos.

 

[Chickenlittle]

I'm not clear on your point. Until I clicked the link I didn't know he was the same guy who spams SA with his crappy videos.

sorry my sense of humor can be strange. just pointing out we are all driven by compulsions whether the posters posting his videos, your watching them knowing they are bad, my pointing out your compulsion is my compulsion, the moderators moving the post. dont think too much about that one, meant no offense.

 

[JRP3]

No offense taken, but my only "compulsion" is to verify that he is "Investary group" and then report him as spam.

 

[eepic]

@100thMonkey - thanks.

As I said earlier

"There is almost nothing that I can point to that has not been thought out from the ground up"

Well there was something: That was the over-exposure to inaccurate misreporting in the mainstream news media and online and basically permitting speculation on several topics from environmental credentials to demand figures to descend outright FUD attack in an information vacuum. (Not complaining when the result is an engineered short squeeze to pay for a big factory but sometimes I can't help but feel that a less volatile media cycle would be an aid to the pace of consumer adoption now that they have the cash to bring forward additional Model S production capacity to absorb it).

Tesla has just found itself what must be the only CVP of marketing from the world of Big Auto that has a plan to insource media content creation, and actually understands that success in online media is something very different from setting up a FaceBook page and buying 100K likes from a click farm.

Looks like Tesla has a decent chance of going on the offensive from April 2014 with pre-emptive in-house generated social and mainstream media information content. I like watching the SpaceX in-house web casts of their launch operations. Who would not like a regular feature virtual factory tour of Tesla with the chance of a pertinent executive comment, Supercharger unveilings, celeb vehicle hand-overs, examples of someone's solar powered Tesla villa...

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The Mercedes system looks very impressive indeed. As a matter of fact the Nissan one does not look too shabby either (although that is self-described as in its infancy with a target launch date of 2020).

What I don't know is if the Mercedes sensor suite is commercially affordable (or any target date for launching it at any price). What I do know is that Mercedes head of electronics Harald Kroeger is on Tesla's board.

It is therefore hard to imagine that Musk is claiming the likely ability to come to market with a system ahead of a program controlled by one of his own board members without having his facts straight.

Elon also spends half his time with some of the best avionics and guidance/control systems engineers in the world at SpaceX. Launching autonomous multi-stage vehicles to dock with an object flying at 27,000 km/hr is not an easy task. With the confidence of his statements regarding autonomy, I think people are underestimating how far along autonomy R&D is at Tesla.

Btw some very well articulated points in the last few pages Julian, bravo!

 

[LST]

Elon also spends half his time with some of the best avionics and guidance/control systems engineers in the world at SpaceX. Launching autonomous multi-stage vehicles to dock with an object flying at 27,000 km/hr is not an easy task. With the confidence of his statements regarding autonomy, I think people are underestimating how far along autonomy R&D is at Tesla.

Btw some very well articulated points in the last few pages Julian, bravo!

I'd love to hear how far R&D has progressed at Tesla, not only on autonomous driving but also a finalized Model X, alpha of Model E, and the partners in the Gigafactory. I personally don't doubt the capability of EM and the team, but i strongly believe the absence of info puts downward pressure on the stock. Our perception / insight and public views are two different animals.
The biggest risk, i agree, is execution to perfection and keeping up with timelines. But i wanted to make a point, that thinking there is no competition, because Tesla is technically far ahead, is a misconception.

 

[LST]

The Norwegian Labor party, which is also usually the biggest but not at the moment in government, wants to keep the tax free rules for EVs. They also want to increase the price of gasoline, which currently cost over $2.5 per liter.

Happy Norwegians !
Our Swiss Governement wants to impose a new tax on EV's (500 CHF/ year = almost USD 600 !) instead of promoting them with some kind of incentive. The rasoning ? Since EV DON't use gas, they do not contribute to the gas tax which is huge ....
For me just another sign how desperate the lobbying against Ev's has become. Hopefully this will never pass.

 

[eepic]

I'd love to hear how far R&D has progressed at Tesla, not only on autonomous driving but also a finalized Model X, alpha of Model E, and the partners in the Gigafactory. I personally don't doubt the capability of EM and the team, but i strongly believe the absence of info puts downward pressure on the stock. Our perception / insight and public views are two different animals.
The biggest risk, i agree, is execution to perfection and keeping up with timelines. But i wanted to make a point, that thinking there is no competition, because Tesla is technically far ahead, is a misconception.

I don't disagree at all execution is a huge risk, especially with regards to timelines slipping by trying to tackle so many things at once. I think from a higher level view competition is not that big an immediate risk because the probability an established automaker will completely leapfrog them is low, and even if so would more likely eat into the ICE market share rather than Tesla's (again, in the short term). Agreed on short term price pressure if no updates come out though.

Edit: Woohoo, hit 100 posts!

 

[ItsNotAboutTheMoney]

Simple example: Not for profit servicing, a business innovation that is aligned to customer satisfaction and building reliable vehicles. End result - more demand at better margins and a cultural advantage over Big Auto to drive vehicle innovation and not design compromise as a profit center.

To me that's simply part of an overall approach of generating profit through a high gross margin in exchange for offering value to the customer through minimizing TCO on an excellent product. The sales-to-service structure, not-for-profit servicing, pay-up-front Supercharging and free mobile data are all examples of that.

 

[AudubonB]

Julian - what is a CVP, please? Thanks.

 

[mitch672]

Julian - what is a CVP, please? Thanks.

Corporate Vice President [ WAG = Wild Ass Guess ]

 

[sleepyhead]

That is how I understood it. However, wouldn't it be nice for Elon to set expectations low.......then deliver high despite cars in transit (ie really ramp production)

I think that it doesn't really matter what they do in Q1. If they deliver 6,400, then Tesla will still have to deliver another 30k cars to meet their guidance number (adjusted for sandbagging to 36.5k, and will probably crush that number as well).

That is 10k per Q in Q2 - Q4, so they are going to have to ramp up quick and I would imagine at least 9,000 deliveries in Q2, 10k in Q3, and 11k in Q4 or something like that.

So even if Q1 is only okay, I believe that Q2 guidance could be huge if they guide towards 9,000 deliveries or more. If not, then Q3 and Q4 will be huge!

In any case, TSLA is looking really good by the end of the year. I just don't know if TSLA goes up next week, next month, or 3-6 months from now. If this economy holds up, and no force majeur event happens to TSLA, then TSLa should be in a very good position to begin 2015.

 

[kenliles]

Agree with sleepy. In fact I'll punch a little further in that I believe there will be a force majeur over '15 and '16 that will transform both EV(TSLA) and Solar into predetermined conclusions

 

[sleepyhead]

Agree with sleepy. In fact I'll punch a little further in that I believe there will be a force majeur over '15 and '16 that will transform both EV(TSLA) and Solar into predetermined conclusions

It is happening right now and nobody even noticed it:

Russia wins "referendum" to annex Crimea.
US most likely will implement economic sanctions on Russia as soon as tomorrow.
Russia to withhold its oil and gas shipments to EU and other countries.

How to ensure that something like this never happens in the future?

Very simple answer:

Solar and battery storage!!!

Solar is really cheap already, the expensive part of it is bureaucratic BS if you want a residential system. Battery is expensive, but Elon says that they can get under $100 per kWh cost by 2022.

Solar is also a matter of national security. It is not just about going "green".

Solar is such an obvious option that it is mind boggling to me that our leaders haven't come to this conclusion yet. The old way of building power plants and transmission lines is not the way to go.

The technology is here to change and there is no reason to hold back. Also, nobody wants to see transmission lines in their back yards. And there is no reason to build transmission lines anymore if we can get battery technology widespread and economical.

This is such an obvious thing to do and I can't believe that the US is not focusing all of its efforts to go in this direction.

 

[mitch672]

This is such an obvious thing to do and I can't believe that the US is not focusing all of its efforts to go in this direction.

I recommend you read the book "Internal Combustion" for the answer to your question.
The same thing has been going on since we burned wood, then coal, the used horses, then moved on to oil & gas, it's been going on for thousands of years...

Internal Combustion: How Corporations and Governments Addicted the World to Oil and Derailed the Alternatives: Edwin Black: 9780914153115: Amazon.com: Books

 

[mrdoubleb]

It is happening right now and nobody even noticed it:

Russia wins "referendum" to annex Crimea.
US most likely will implement economic sanctions on Russia as soon as tomorrow.
Russia to withhold its oil and gas shipments to EU and other countries.

How to ensure that something like this never happens in the future?

Very simple answer:

Solar and battery storage!!!

I really hope this latest Russian standoff pushes the EU even more towards solar and wind for everyday power generation. Germany is already a big proponent, I even heard of an intiative to build huge solar power plants in Northern Africa and supply up to 15% of Europe's energy from there.

However, I do not know if solar could be the answer to the main usage of the Russian gas in Europe: heating. My country imports about 60% of the gas from Russia, through the Ukraine, others in Easten Europe do more, but even Western Europe is somewhat exposed. We can have pretty bad winters over here and I doubt we have enough sunshine to switch everyone to electric heating in, say, January or February.

 

[sleepyhead]

I really hope this latest Russian standoff pushes the EU even more towards solar and wind for everyday power generation. Germany is already a big proponent, I even heard of an intiative to build huge solar power plants in Northern Africa and supply up to 15% of Europe's energy from there.

However, I do not know if solar could be the answer to the main usage of the Russian gas in Europe: heating. My country imports about 60% of the gas from Russia, through the Ukraine, others in Easten Europe do more, but even Western Europe is somewhat exposed. We can have pretty bad winters over here and I doubt we have enough sunshine to switch everyone to electric heating in, say, January or February.

I am not sure if the main usage of natural gas in Europe is for heating; maybe it is but I doubt it. I would assume that a lot of it is used to run natural gas power plants and/or cars that run on gas (most these run on propane or butane so I am not sure if that is imported from Russia as well).

The key is that solar would reduce dependence on oil as well as natural gas.

Many decades from now when battery storage becomes cheap, you will probably be able to put a big solar system on your roof with a big battery storage device next to your house. You can then run electricity and electric heating during the winter without the need for any oil, gas, or other fossil fuels.

 

[Johan]

I am not sure if the main usage of natural gas in Europe is for heating; maybe it is but I doubt it. I would assume that a lot of it is used to run natural gas power plants and/or cars that run on gas (most these run on propane or butane so I am not sure if that is imported from Russia as well).

The key is that solar would reduce dependence on oil as well as natural gas.

Many decades from now when battery storage becomes cheap, you will probably be able to put a big solar system on your roof with a big battery storage device next to your house. You can then run electricity and electric heating during the winter without the need for any oil, gas, or other fossil fuels.

1. In EU definitatly Natgas is mostly used for electricity generation (http://www.seec.surrey.ac.uk/research/SEEDS/SEEDS143.pdf)

2. I'd be very careful about making predictions about details "many decades from now" I guess one thing that is very likely is that there are not going to be bi battery storage devices next to houses. I don't know what we will have, but likely not that.

 

[mrdoubleb]

I am not sure if the main usage of natural gas in Europe is for heating; maybe it is but I doubt it.

I think looking at natural gas can be a bit tricky. You may ask how much of the gas is used for heating, and get a certain figure. But if you look at it from another angle you may ask how much of the heating is relying on natural gas.This EU estimate says 45% of the EU-27 residential heating is based on gas. I know that for countries of the former Soviet block this percentage is even higher as we had cheap and easy access to Russian gas. A Wikipedia page on Hungary's energy consumption (I could link it, but I doubt you guys read Hungarian :tongue says 60% of our heating is from natural gas, while we also have a really high number, 17%, for District Heating (central heating for many blocks of buildings), which no doubt relies heavily on gas too. (Some of it is from burning waste). There are 3100 settlments in the country (from city to village), and 2600 of them are connected to the natural gas pipeline network. The peak gas consumption in the winter is 60-70 million m3 per day, which no doubt makes out the majority of the 13 billion m3 of gas usage per year. (We normally heat from late October to mid March.)

So that's what you would have to replace with solar. I found some data on the total number of sunshine duration per month in Hungary. In the Summer it gets as high as 270-300 hours/month, in the winter it is 40-60. (I know some of you are reasearching solar energy as well, so if you are interested here is some official data on solar radiation for my country in English by the National Meterological Institute)

While i have all the confidence in Tesla's energy storage buinsess in the long run, I do not see how one could store elecricity generated by solar panels in June-August for heating in February. Especially not on this magnitude.

Of course, one could say the EU should build those solar farms in Northern Africa, hell, make them 5x bigger, and have all the solar energy from there during the winter. But that would be just as risky for energy independence as Russian gas, subject to local or internation power plays.

 

[Robert.Boston]

Another data point re sector usage:

 

[GenIIIBuyer]

I think looking at natural gas can be a bit tricky. You may ask how much of the gas is used for heating, and get a certain figure. But if you look at it from another angle you may ask how much of the heating is relying on natural gas.This EU estimate says 45% of the EU-27 residential heating is based on gas. I know that for countries of the former Soviet block this percentage is even higher as we had cheap and easy access to Russian gas. A Wikipedia page on Hungary's energy consumption (I could link it, but I doubt you guys read Hungarian :tongue says 60% of our heating is from natural gas, while we also have a really high number, 17%, for District Heating (central heating for many blocks of buildings), which no doubt relies heavily on gas too. (Some of it is from burning waste). There are 3100 settlments in the country (from city to village), and 2600 of them are connected to the natural gas pipeline network. The peak gas consumption in the winter is 60-70 million m3 per day, which no doubt makes out the majority of the 13 billion m3 of gas usage per year. (We normally heat from late October to mid March.)

So that's what you would have to replace with solar. I found some data on the total number of sunshine duration per month in Hungary. In the Summer it gets as high as 270-300 hours/month, in the winter it is 40-60. (I know some of you are reasearching solar energy as well, so if you are interested here is some official data on solar radiation for my country in English by the National Meterological Institute)

While i have all the confidence in Tesla's energy storage buinsess in the long run, I do not see how one could store elecricity generated by solar panels in June-August for heating in February. Especially not on this magnitude.

Of course, one could say the EU should build those solar farms in Northern Africa, hell, make them 5x bigger, and have all the solar energy from there during the winter. But that would be just as risky for energy independence as Russian gas, subject to local or internation power plays.

Is it windy in the winter? I would think wind turbines + energy storage would be the way to go.