I don't have a hard figure yet, but found this at the Battery University
This was in contrast to what they said about NMC. So empirically they must not cost the same.
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TrendTrader007
Active Member
yeah! i bought TSLA at $155 or so earlier this year then sold it at $250 or so then regretted my erroneous ways so bought back a ton of stock at $225. one thing for sure, there is never a dull trading day in TSLAdomNot sure about head and shoulders, but it does look good. I see double bottom, beginning of V or U shaped recovery etc. Additionally, as it moves up, limited availability of shares to borrow will put pressure on weakest of the shorts to cover.
I dare not hope though, as TSLA is technically famously deceiving stock.
But one good is, while most stocks take stairs up, and elevator down, TSLA uses elevator both down and UP
that's why i wanna buy more common right here instead of calls because if this sucker goes up, it will go up super fast and the potential profit in TSLA common within the next 12 months or so (before the next stock market crash happens) i believe will be quite satisfactory
anyways, the name of the game is compounding your entire net worth in my humble opinion
i mean, what's the point of making money in your right pocket and losing it from your left! makes no sense to me. so what i wanna do is minimize my mistakes and maximize my profits. at the end of the day i judge my performance on the basis of how my entire portfolio is doing and sometimes things are obvious and sometimes while what was manifestly obvious turns out to be totally wrong
Do you have more details on this? I know GM sort of leaked the cell cost for the bolt, but we don't really know the details of the deal, was this sort of a one off incentive discount thing? is 145/kWh the standard price LG Chem will provide going forward to all autos?
Genuinely curious, do you have links to these other giga-factory scale battery manufacturing projects? I'd be interested in reading more about the timelines and locations of these projections. Thanks in advance.
I believe it's exactly what he says- they have already been working on and now need to integrate the effort for a vertical solution product. It's the same reason they brought MBLY internal - [external too slow and more costly integration etc];
The perception that waiting to allow SCTY to move to pennies on the dollar is antithetical to Musk internal view in 2 ways:
1) There is no scenario in Musk-ville that produces a SCTY valuation of pennies on the dollar (even if the market would provide that).
It would be incongruent with his own valuation of assets against liabilities (proven by his actions and those of SpaceX etc.).
He would have to be betting the market would provide that collapse in value of SCTY - scheming to acquire it's assets at a bargain - while owning and controlling the strategy of the company. The difference somehow being worth the scheme (which is what it translates to in his mind imo)
The way to accomplish that scheme: [as it's Chairman, de-facto leader, bond holder, largest shareholder] would be to allow continuation of the business model currently deployed (capitalized growth against future revenue) without modification. The resulting loss in value to his own (and associates) shares, reputation, SpaceX default on bonds (or equivalent), etc. would financially dwarf the entire SCTY franchise value. In other words- he would be compelled to 'save it' [under the assumption of that hypothesis] even if required to buy the entire thing and fulfill all it's net-debt obligations himself.
2) IMO the time loss alone (say 6 months of product development) is likely worth the entire net worth of SCTY in the context of what he wants to achieve.
Remember inside his head- the strategy described would require him to concurrently for a period of time- abandon the mission of sustainable Solar power as if it's value at least for a period of time is somehow diminishable (in his head) while we wait for a better acquisition price to then resume our mission so critical to our humanity... It's just too much to ask of Elon- I think his head would explode
In fact, I place the odds of merger happening above 100%. The small chance TSLA shareholders vote it down, completely dwarfed by the consequences of same to their own interests- AND via Elon will happen in a different way anyway. Since all TSLA shareholders know Musk support of Tesla is critical to their own interests, there would have to be enough voting against it, believing that Elon will in fact, abandon the SCTY commitments (debt and otherwise) in favor of TSLA support somehow- while exhorting the entire world to sustainable energy- the ENTIRE reason for Tesla existence --
Remember this is a man that put all of his own money into these (including SpaceX) 2 missions precisely because no one else valued the asset of the effort to be worth it's cost. He doesn't think twice about seeing a higher value for a (SCTY) piece of the equation of a solution that no one else in the world is currently pursuing - by definition it only carries that value to the only one pursuing it.
It was why he created SCTY in the first place...
If you take delivery by 9/30 the deal persists...
My simplistic view is that HRC wil continue more green energy initiatives, whereas DT will likely roll them back (I believe his energy advisor is a oil/gas person... There is a thread on that).
Question for you. You had mentioned that you see a huge uptrend in the overall market/economy. Are you basing this on the Kondratieff wave theory and the likelihood that we are entering the spring?
Thanks!
TrendTrader007
Active Member
Thanks. i thought so too. HRC may be the person who does better for green energy
i see us in the midst of a secular multi-year bull market based on my read of historical yearly charts of DOW and S&P 500 going back 100 years all the way to 1902. i follow nasdaq and $comp has only been in existence since 1973 or so but there are clearly decades of upswing and downturns. current Nasdaq chart reminds me eerily of 1994/1995 time frame when the quarterly $comp candles were about to make a major bollinger breakout. i believe that a similar scenario is occurring right now and if i am right then we are in for at least another decade or so of bull market ( with major crashes along the way). now it could be 5 years of bull or 15 years but my best guess based on real estate cycle is that we will peak in 2028 or so. make money while you can. that is why i am super aggressive, i wanna make all my millions(or billions) in this great secular bull market that we are currently in but that most investors refuse to recognize
i may post more of my detailed thoughts when i have more time , later this evening
gotta go and make money to feed the bull
TrendTrader007
Active Member
Ok, so here are my 2 cents reflecting to the debate on the last few pages - this may get long, so i spilt it to two posts.
1, GM Bolt / LG and Samsung as a competitor or supplier to competitors
DaveT's theory - as I understood it
Normally I read and agree with almost everything that DaveT writes, but this time I am in the other camp. Dave's thesis is that LG and or Samsung can now match Panasonic on battery pricing, hence the GM Bolt. Dave deducts this from the fact that Tesla has talked to and qualified both LG and Samsung, so he says it shows they must have been on pair. The fact the deal didn't go through (save for the Roadster) is due to Panasonic being able to meet Tesla demand - that's how i read his posts. He also discounts the insider information we read on GM losing 5 grand on each Bolt and the one about LG flipping out over GM disclosing the heavily discounted $145 price they charge for cells. I see this quite differently.
My counter
Barring any major technology breakthrough at LG and Sammy that we don't know about, this is mainly a matter of volumes. According to this chart from Celantechinca, in 2015 Pana was about 3x the size of LG and 9-10x of Samsung. Now this is production, not capacity and we know LG has been building factories in China, but when these negotiations were going on, do we honestly believe LG could have gotten the same production efficiencies and same deal on raw materials as Panasonic, 3x its size? The math does not add up. And that's before adding any of the edge Tesla has with its custom anode/cathode and electrolyte design and Panasonic has with its manufacturing experience (fueled by their Tesla experience of the last 10 years). So I for one think the stories do make sense about LG doing a heavy discount on the batteries for the Bolt by bundling it with half the components in the car (well anything that matters, really) and also in the interest to gain market share and lock GM in long term. Add to that the insider info Dave discounts where GM still loses 5k (7.5k after the rumored price drop) on every car and you certainly understand why the limited production to 30-50k per year.
Let me put it this way: if LG is truly at Tesla levels with cell/pack pricing and the paired up with GM who have the ability and the experience to produce millions of cars a year (unlike Tesla), why in the world did they limit production to such a small quantity? It wouldn't make sense - especially in light of Model 3 (proven demand at that price point). And looking ahead, I do get LG, Sammy, BYD are all planning and building 10-20-30GWh factories, but how will volumes, manufacturing efficiencies and deals on raw materials compare to Tesla's 150GWh monster?
1, GM Bolt / LG and Samsung as a competitor or supplier to competitors
DaveT's theory - as I understood it
Normally I read and agree with almost everything that DaveT writes, but this time I am in the other camp. Dave's thesis is that LG and or Samsung can now match Panasonic on battery pricing, hence the GM Bolt. Dave deducts this from the fact that Tesla has talked to and qualified both LG and Samsung, so he says it shows they must have been on pair. The fact the deal didn't go through (save for the Roadster) is due to Panasonic being able to meet Tesla demand - that's how i read his posts. He also discounts the insider information we read on GM losing 5 grand on each Bolt and the one about LG flipping out over GM disclosing the heavily discounted $145 price they charge for cells. I see this quite differently.
My counter
Barring any major technology breakthrough at LG and Sammy that we don't know about, this is mainly a matter of volumes. According to this chart from Celantechinca, in 2015 Pana was about 3x the size of LG and 9-10x of Samsung. Now this is production, not capacity and we know LG has been building factories in China, but when these negotiations were going on, do we honestly believe LG could have gotten the same production efficiencies and same deal on raw materials as Panasonic, 3x its size? The math does not add up. And that's before adding any of the edge Tesla has with its custom anode/cathode and electrolyte design and Panasonic has with its manufacturing experience (fueled by their Tesla experience of the last 10 years). So I for one think the stories do make sense about LG doing a heavy discount on the batteries for the Bolt by bundling it with half the components in the car (well anything that matters, really) and also in the interest to gain market share and lock GM in long term. Add to that the insider info Dave discounts where GM still loses 5k (7.5k after the rumored price drop) on every car and you certainly understand why the limited production to 30-50k per year.
Let me put it this way: if LG is truly at Tesla levels with cell/pack pricing and the paired up with GM who have the ability and the experience to produce millions of cars a year (unlike Tesla), why in the world did they limit production to such a small quantity? It wouldn't make sense - especially in light of Model 3 (proven demand at that price point). And looking ahead, I do get LG, Sammy, BYD are all planning and building 10-20-30GWh factories, but how will volumes, manufacturing efficiencies and deals on raw materials compare to Tesla's 150GWh monster?
Part 2. - SCTY
So I must admit I wasn't 100% happy about this either, mainly because of the questionable financial background of SCTY and the distraction it can provide to Elon and co. But 2 things tell me this will still be a great move in retrospect.
One, is Elon and JB. Like others, I trust those guys and think if they are on board I either continue to trust them or sell my TSLA. This is not blind trust, just logic based on past performance.
Two. On the consumer market this may be the next "iPhone moment". Apple didn't invent the smartphone, but Jobs found the flaws with how other manufacturers designed/presented them to consumers. Elon the same way, realizing if the design can be attractive and easy to deploy, consumers interest will rise. If Tesla can take you off the grid with an integrated panel-inverter-storage design that is installed by 1 team in a few hours/day, that's a major feat. They will also have pricing on their side, as the new panels will be 20-30% more efficient than mainstream ones used today, meaning you may need that much less of them. Panels and inverters are both very expensive today and your return is 5-15 years depending on your country/state and incentives. If a combined Tesla advanced PV panel and inverter design can make that 1/4 less expensive and it even looks good, well, that may be a no brainer. And if you can afford it, they can add a Powerwall to the mix with the cheaper GF1 cells and you can go completely off grid.
Three, and this is the big one. On utility scale designs Tesla will be able to deliver complete, turn-key power plants at a fraction of the time and probably less cost than building a new peaker gas plant. OK, ok, so there are probably a few other things that go into a power plant, but you get the idea, they can deliver the guts of the plant in one deal in a matter of months. PV + inverter + Powerpack.
I haven't quite finished the Elon biography yet, but what is already clear to me about the man is that he felt he got burned every single time he let things out of his hands, when he had to depend on 3rd parties and outside vendors. Look at what Tesla has been doing with insourcing much of their component production - the total opposite of what the rest of the vehicle industry was doing. Fact is, and Mobileye is the latest example, no outside partner can , or is willing to match Tesla's development speed. Elon is taking much higher risks and doing much more revolutionary, ground up new designs than what standard corporate culture would allow. So yeah, maybe it would have made sense to snatch up SCTY a year from now when M3 is already in production, but by then SCTY would have either gone bankrupt or would have been too expensive due to the success of the new panels and he wasn't going to risk that.
So I must admit I wasn't 100% happy about this either, mainly because of the questionable financial background of SCTY and the distraction it can provide to Elon and co. But 2 things tell me this will still be a great move in retrospect.
One, is Elon and JB. Like others, I trust those guys and think if they are on board I either continue to trust them or sell my TSLA. This is not blind trust, just logic based on past performance.
Two. On the consumer market this may be the next "iPhone moment". Apple didn't invent the smartphone, but Jobs found the flaws with how other manufacturers designed/presented them to consumers. Elon the same way, realizing if the design can be attractive and easy to deploy, consumers interest will rise. If Tesla can take you off the grid with an integrated panel-inverter-storage design that is installed by 1 team in a few hours/day, that's a major feat. They will also have pricing on their side, as the new panels will be 20-30% more efficient than mainstream ones used today, meaning you may need that much less of them. Panels and inverters are both very expensive today and your return is 5-15 years depending on your country/state and incentives. If a combined Tesla advanced PV panel and inverter design can make that 1/4 less expensive and it even looks good, well, that may be a no brainer. And if you can afford it, they can add a Powerwall to the mix with the cheaper GF1 cells and you can go completely off grid.
Three, and this is the big one. On utility scale designs Tesla will be able to deliver complete, turn-key power plants at a fraction of the time and probably less cost than building a new peaker gas plant. OK, ok, so there are probably a few other things that go into a power plant, but you get the idea, they can deliver the guts of the plant in one deal in a matter of months. PV + inverter + Powerpack.
I haven't quite finished the Elon biography yet, but what is already clear to me about the man is that he felt he got burned every single time he let things out of his hands, when he had to depend on 3rd parties and outside vendors. Look at what Tesla has been doing with insourcing much of their component production - the total opposite of what the rest of the vehicle industry was doing. Fact is, and Mobileye is the latest example, no outside partner can , or is willing to match Tesla's development speed. Elon is taking much higher risks and doing much more revolutionary, ground up new designs than what standard corporate culture would allow. So yeah, maybe it would have made sense to snatch up SCTY a year from now when M3 is already in production, but by then SCTY would have either gone bankrupt or would have been too expensive due to the success of the new panels and he wasn't going to risk that.
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off topic
So I never quite understood why the US media is presenting it like this. (I know this wasn't a screengrab of primetime news, but that punchline could be the summary of current news coverage).
You have one candidate who is smart, prepared, proven as diplomat and yes, probably as establishment and shady as any other mainstream politician.
The other guy though... well, if he will have the nuclear codes I may just reserve a ticket for the next SpaceX flight to Mars.
The question of how long is indeed crucial. With the well deserved attention to the SolarCity financials, the fundamentals of TE got totally overlooked and dismissed based on incorrect assumption of commodification. The TE aspect of the SolarCity acquisition is really at the heart of it. In Elon words during the early morning SolarCity acquisition call, everybody who sees and appreciates product aspect of the acquisition is unequivocally for it, while those who stop at just looking at finances - against.
Just to make this clear - I am not dismissing financial concerns and absolutely think the house need to be brought in financial order because otherwise the PURPOSE is at risk. Having said this, Tesla is a PURPOSE driven company, so building up the overall strategy *starts* with designing a product to achieve the PURPOSE. The second step is charting the best and most optimal financial path to materialize the product.
As a disclaimer, I was never and still am not a SolarCity investor, mainly because I felt that financial path that was chosen had a little more complexity and risk to it that I was willing to bear.
Now, to the core of my argument about the product, the commodification and low margins are a well known phenomena for a steady state production and well matched demand and supply. The point I was making is that for foreseeable future (say a decade) the commodification just does not apply here.
In order to show this I am going to use numbers presented by Elon during the TE reveal. Replacement of the *current* WW Electricity production with renewables (Goal #1) will require 90,000 GWh of BES, while replacement of WW Electricity production, heating and transportation (Goal #2) will require 200,000GWh of BES.
Let's assume that above quantities of BES will need to be replaced on a 15-year cycle, i.e. that on average cars and BES for electricity production and heating will need to be replaced every 15 years. Let's further assume that average size of a GigaFactory is 100GWh. So in order to get ourselves on the path achieving Goal #1 in 10 years, on a 15-year cycle (total time frame of 25 years) we will need to build 90,000 / 100 / 15 = 60 GF.
In order to achieve Goal # 2: 200,000 / 100 / 15 = 133 GF.
So we will NOT get to commodification over the next 10 years unless the world builds on average 6 x 100GWh GF per year over next 10 years for Goal #1, or average of 13 x 100GWh GF per year over the next 10 year.
These are incredibly high thresholds to top over the next 10 year, so I do not believe in commodification of TE over at least next 10 years. It goes without saying that *eventually* commodification will surely happen, but we are talking about completely different time scales.
So this is my main point which IMO was completely overlooked: aggressively pursuing TE, not putting it on a back burner until M3 is fully ramped, is a brilliant in its simplicity strategic move that many do not fully appreciate. This allows for a huge stream of cash at the time when company's appetite for cash is at its peak - when it is growing by bounds and leaps - say next 10 years, all at a very moderate incremental expense. TE IMO will allow Musk industries to become a self feeding beast.
Finally, one more fundamental point that I wanted to emphasize. At one of the ER Elon was asked a question (by Andrea James) - given a limited battery supply, what will get priority - TE or TA. Elon responded that TA will get first priority. Of course a few things changed since then and now final size of GF trippled, but this question - divvying up battery production stream between TE and TA has another important consideration. This consideration is how much of gross income can be generated per kWh of batteries when they are used in TE vs TA. The ideal ratio of the gross profit per kWh of batteries in TE vs TA would be 1 : 1. I believe that is how Elon and team are looking at this. So if M3 as I showed in this post, allows for $200 of gross income per kWh of batteries, and these batteries are manufactured at the GF at a cost of say $120/kWh (hold off your attacks -you know who you are - I am just being conservative here
), TE will need to sell batteries at $120+$200 = $320.This price - $320 - is very significant as it is so much lower than the price offered by the competition AND is low enough to spur massive demand in TE products. This is another reason why focusing on TE concurrently with TA makes a lot of sense.
So my point, once again, is that consideration of the SolarCity acquisition without considering the above is really missing the mark. This in my opinion is why what Elon called a "no brainer" does not appear so for so many.
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Folks, PLEASE don't make me pull the No Political Stuff cord. Thanks.
Folks, PLEASE don't make me pull the No Political Stuff cord. Thanks.
MitchJi
Trying to learn kindness, patience & forgiveness
It's important to note that a major reason that the current SP is so low (or the current opportunity is so huge) are the problems Tesla has had ramping the MX production. I believe that this is also a major reason for a lot of the recent negativity in this thread.
This was due to the fact that the MX is an extremely difficult car to build. If they had designed and built a conventional SUV, which would have been about as difficult to build as the MS there is every reason to think that the results would have been similar to the Model S (a very successful production ramp).
Tesla Motors Inc. Looks to Falcon Wing Doors for Marketing -- The Motley Fool
About to become a plus:
This was due to the fact that the MX is an extremely difficult car to build. If they had designed and built a conventional SUV, which would have been about as difficult to build as the MS there is every reason to think that the results would have been similar to the Model S (a very successful production ramp).
Tesla Motors Inc. Looks to Falcon Wing Doors for Marketing -- The Motley Fool
About to become a plus:
Before they started MX production Tesla revamped their production line. Setting up 2 lines S and X designed to do initial production, plus a 3rd line designed to do final assembly for both. In spite of the fact that problems with the X final assembly have had a negative impact on S production, the S production has increased nicely. The mistakes the markets are making is to equate the X problems as general problems, rather than X specific problems, and to think there is any reason at all to think they will happen with the M3, which is being designed from the ground up to be easy to build. If anything their problems with the X make it less likely that they will have similar problems with the M3, because they are clearly bending over backwards to avoid repeating that mistake.
The same huge institutional investors are also the same ones not closing the huge 20%+ arbitrage gap over a binary short-term event with the SCTY-TSLA merger. So yes, I yield to the insider information they do have and am not willing to tolerate such risk in either stock right now.
I largely agree with this. Tesla is still burning cash and will burn lots of cash during Model 3 prep/ramp. If they did an acquisition that would help their chances to ramp and scale Model 3, that would be a different story. But SCTY acquisition is to help a future line of business (TE). It's an ambitious play. As if ramping and scaling Model 3 2 years earlier than expected isn't ambitious enough.
If SCTY was a better company, I wouldn't have many issues with it. Sure, it diverts attention and lowers focus/attention to Model 3 ramp... but Elon is an ambitious guy who wants to solve not just electric transport but also sustainable energy. Tesla can handle it, albeit with some challenges. But the way I see it, SCTY is a company in a deteriorating position that will divert more attention that anticipated away from model 3 prep/ramp and will divert more resources/finances than expected as well. This might be the right move if Tesla can weather through the difficulties of this merger over the next few years, and in 5 years we see this was a brilliant move that expands Tesla's addressable market significantly (which it should if it's successfully). But the risk is this merger is happening during one of the most crucial periods of the company, during an expedited Model 3 ramp. And on top of this Tesla's stock price is already hit due to the Model X ramp fiasco so it has less options to raise funds compared to if they had nailed the Model X. All this to say, that I think Tesla can pull off the merger and I think things will be ok for Tesla and will ultimately work out. But there is increased risk of Tesla hitting more of a cash crunch and extreme fiscal challenges, especially if we experience a severe recession next year and the Model 3 ramp isn't as quick as expected. I'm not saying that risk is more than 10%... I would assess the risk probably between 2-5%, and I'm still trying to get a better grip on the risks myself. And if you only have 10-20% of your portfolio in TSLA, then it's probably not a big deal. And perhaps that's why I'm getting a lot of flak over this.
On your point about Elon saving Elon's shareholders at the expense of TSLA shareholders... I look at it more like Elon does what Elon needs to do. He doesn't care that much about share price or shareholders, per se. He cares about his vision/mission and reaching that goal. He's completely fine with a minor increase in existential risk of Tesla as long as he thinks the move will significantly help him/Tesla reach it's ultimate goal. In Elon's mind, SCTY acquisition must happen for Tesla to push sustainable energy forward. I just wish the acquisition could wait till Tesla was a bit more stable (ie., 2018, post Model 3 ramp).
It's true that Tesla could have some hidden agenda in attempting to buy cells from Samsung SDI, LG Chem, and SK Innovation. But it's also true that Tesla simply could be very serious about buying cells from them because they make good cells at a good price. Yes, Panasonic likely makes the best cell for auto... but it doesn't mean that other companies can't match Panasonic's price. IMO Panasonic doesn't have any amazing proprietary tech that brings down the cost of the cell significantly over their competition.
It's easy to discount LG Chem's $145/kWh price... but I think the more appropriate question is can you prove that they aren't making money at that price?
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