Short-Term TSLA Price Movements - 2016

[racer26]

Interesting. Saw Fred's post about the Powerpack configurator being back up with new PowerPack2 pricing.

What's a bit interesting is if you crank the power and duration all the way down, you get what is (I think, based on pricing and features listed):

1 PowerPack1 at 50kW for 2 hr duration (100kWh)
2 PowerPack1's at 50kW for 3 hr duration (190kWh)
1 PowerPack2 at 50kW for 4 hr duration (210kWh).

It looks as though they're still selling some PowerPack1's, but at a greatly reduced price.

 

[Krugerrand]

China threatening to make life hard for American companies doing business in China could explain the drop..

China threatens to cut sales of iPhones and US cars if 'naive' Trump pursues trade war

"When the time comes, large orders for Boeing planes would switch to Europe, U.S. auto sales in China would face setbacks, Apple phones would essentially be crowded out, and U.S. soybeans and corn would be eradicated from China," the paper said in a commentary."

Tesla may not be as affected as the other US auto companies that increasingly rely on China for growth/volume. In October, GM China sold 345,000 vehicles, nearly 100,000 more than their home market. Not sure if the restrictions only apply to imported vehicles though I doubt it considering the negligible number of cars imported to China from the US.

A lot of times people let their inner drama queen take over their everyday lives and often she doesn't think things through before opening her mouth.

Mr. T *could* really misstep badly with the whole trade deal stuffs. I suspect when speaking with my more boring and reasonable side that once he has all the 'facts' (and isn't channeling his own inner drama queen) and has his crew of (is it 9,000?!) advisors and staff to guide him that the above won't actually happen to any significant degree. Trade goes both ways and needs to reflect fairness and an advantage to both parties.

I don't like the ******, *******, *****, **********, lying sack of sugar, however, he's not stupid and after watching the 60 minutes interview I think he (and his family) fully understand the importance and gravity of the situation. I expect him to significantly tone down his 'I'm going to do this and that' to a much more reasonable level. Running one's mouth off to rile up the masses isn't the same as executing policy once you're in office. We've seen this movie before.

On top of that, China would have their own 'revolution' and the richer among their population (those who are already paying the huge import fees and taxes on vehicles) would continue to buy Teslas and whatever other cars signify their status etc...

I really abhor speculation. It could. It might. Perhaps. Maybe. But in the end it's usually one big yawnfest. Tesla will be fine long term. Short term it's anyone's guess.

 

[Rarity]

Temporary import tariffs is one of the few areas where the U.S. president has power to make immediate changes (the institution of the presidency is incredibly weak in the U.S. versus other countries). I expect Mr. T to talk tough, just as well as the Chinese. The drama queen response to this diplomatic theater is silly, but tariffs could have negative short-term consequences for Tesla's business and thus is worthy of following.

Of course, a very short trade war could have positive consequences as well for TSLA -- any trade war is disruptive, but it would be much more disruptive for China than for the U.S.

 

[Nate the Great]

For those of you asking for short sales.

This is from Fidelity: 20,571 shares available For shorting they are charging 0.000 % interest rate. it is now classified as "Easy" i.e. shares are readily available.

 

[tftf]

People saying that the SCTY merger makes no sense

The business has evolved significantly from the original days and de-risked itself by creating what I call revenue hedges. It used to just be Powertrains and cars. Now it's:

- Cars
- Battery Packs
- Solar Roofs/Panels
- Powertrains (when and if somebody wants to make a deal)
- Robotics (super fresh)

There will also be commercial vehicles in the portfolio, passenger cars is not enough (Tesla trucks, buses, semi trucks...). Plus electric, super-sonic airplanes.

Maybe merge with Space X in a few years, so interplanetary travel is also possible and no second phone call is necessary.

Tesla shouldn't have a too narrow focus. Adding more revenue hedges (as you call it) and options is super-important. So is the SCTY merger - it all adds even more options and more revenue.

Yes, there will so some short-term bumps adding and merging all these new product lines. No problem, just raise more funds / sell more shares.

If Trump is a roadblock for Tesla in the US, just add more Gigafactories and car plants in Europe and Asia.

Raising another $10, 20 or even 50 billion to ultimately get to a trillion $ market cap is minor short-term pain for major long-term gain.

Go Elon!

 

[Jayjs20]

Tech stocks are down this morning, but the sp500 is about even. I think people are shifting their stock rather then taking it out of the market

 

[esk8mw]

Guess I'll just buy more at 180 like I always do. Ready to make more buys below 180 as well.

 

[anon]

I am not too concerned about the trade war with China. The Chinese already have a 25% import duty on all cars. A few years ago (I think 2011), they increased tariffs on American cars in a small trade war with Obama, after he increased tariffs on Chinese car tyres. However, the Chinese taxes were dependent on engine size, starting at 2.5L. This meant taxes as high as an additional 22% in some cases, but no extra taxes in other cases. My conclusion from this is that they are unlikely to heavily tax Tesla in a new trade war, but will shift to higher taxes on other brands. Even a lot of German-branded cars sold in China are actually made in US factories!

Even if Tesla's tariffs are increased, the increase would have to be very large to significantly affect the market - Tesla does not price gouge anything like as much as the other prestige brands, so a lot of buyers of other expensive brands could easily afford some price increase on Tesla cars. Furthermore, when the taxes are already 25% import duty + 17% vehicle tax, I don't think some further increase in tax is going to affect purchasing decisions very much among those who can afford the already-high prices.

 

[Rarity]

Here's a good readout of the U.S. trade in goods situation with China as of year-end 2015. For 2015, China represented about 50% of the US goods trade deficit, so we shouldn't be caught by surprise at the vigor with which Trump moves to address the situation.

http://origin.www.uscc.gov/sites/default/files/trade_bulletins/February 2016 Trade Bulletin.pdf

The services portion of the trade equation looks better, but it is a smaller piece.

Edit: And here is the annual report for 2015. Lots of food for thought.

http://origin.www.uscc.gov/sites/default/files/annual_reports/2015 Annual Report to Congress.PDF

 

[Nate the Great]

I am curious if anyone hear knows, how long it will take after the vote for the Solar City shares to convert to TSLA equivalent dollars?

 

[KLC13]

For those of you asking for short sales.

This is from Fidelity: 20,571 shares available For shorting they are charging 0.000 % interest rate. it is now classified as "Easy" i.e. shares are readily available.

I am not a finance guy and basically a noob on this trading lingo. What does 0% interest rate on shorting mean? I thought you have to pay a certain interest for borrowing the shares that you are selling (without owning). Does 0% mean I pay nothing to borrow?

Also, since TSLA is so heavily shorted, why is the interest rate so low? It seems like shorts are having an easy time shorting the stock and there is no downside to them for holding the shorts for extended periods (except for a significant SP increase). If this is the case, I think shorts will not squeeze out until successful roll out of M3, which means another few quarters of depressed SP?

 

[windgrins]

Exactly

Trump wants to Make America Great Again.

Tesla:
- manufactures here
- is investing in the US
- has the GF
- is spending a lot on R&D
- hiring people to put panels on roofs (SCTY)
- creating better product than cheap Chinese panels (SCTY)
- showing how private enterprise can perform better than gov't entities (SpaceX), etc. etc.

If Tesla continues this path and continues to help Make America Great Again, they will do just fine.

I don't think you should count very much one way or the other that Trump will support Tesla or Spacex due to real value to the US.

So far Trump has waffled all over the map on pretty much everything and isn't predictable except for "revenge politics".

 

[windgrins]

Bloomberg: Fiat Chrysler, GM Soar as Trump May Weaken Fuel-Economy Rule

If fuel efficiency requirements for ICE vehicles are reduced under a Trump administration, that should mean consumers concerned about fuel economy would become all the more inclined to choose electric vehicles.

Curt, I'm confused by your comment here. Reducing pollution controls typically increases vehicle mileage (fuel economy). So why would this make buyers be inclined to choose electric on that basis? It seems as if it would have the opposite effect.

 

[SteveG3]

One thing I haven't seen mentioned here is the Motortrend Awards. I just got an email for their award presentation which is tonight, and Tesla is a finalist for both 2017 Car of the Year with a redesigned S60/75 and 2017 SUV of the year with the Model X. Their initial judge of the X was a bit critical of the lack of utility in the SUV so it may not take the crown. But the writeup on the S was really positive I thought, especially considering their comparison to all other technologically outdated cars.

What do you think will be the positive impact on short term share price if Tesla walks away with both of them this evening. I would expect a nice size pop tomorrow at least.

Thanks,
Wayne

I suspect they are going to pick the Bolt as COY given what they have already said about the car. Prepare for FUDsters to spin this as disaster for Tesla as if the long range EVs were a separate kiddie pool of the auto market which will fillup with the minuscule 30K annual Bolt capacity GM has (battery constrained). This will likely be particularly laughable FUD as probably the point of the Motor Trend choosing the Bolt (if they do) will be that it is a major step towards EVs flatout matching up well with ICE (ie NOT a tiny kiddie pool market for the most "Green" among us) at mass market prices. Anyone really thinking about this would see this as a Motor Trend endorsement for the Model 3 and all mass market priced long range EVs.

 

[Nate the Great]

I thought it was odd too, I just rechecked it again and it the same. I have also included the short sales available for Solar City. To be honest I do not now how they create this market and how they determine the availability. Right now they are down to 18,421 from 20,571. With 152,124 shares of SCTY, classed as "Hard" and they are paying 6.5%.

You are correct I doubt they are handing them out for free. I'll send the VP of Fidelity Capital Markets a note asking for clarification, we will see what they come back with.

 

[SteveG3]

Any particular catalyst for this massive decline at the open? I'm used to early trading dips but this one is steeper than normal. I can't find any news aside from Samsung buying Harman (who cares?).

I think more than anything it's a manifestation of the rampant years long propaganda campaign to hurt Tesla and TSLA with the incessant repetition of falsehoods. The whole point is to create the false impression that these falsehoods are common sense and to even suggest one disagrees would show one as an ignorant fool to be ridiculed.

Chief among these falsehoods is the claim that Tesla is vastly overvalued. The soil has been tilled for years that that is OBVIOUS COMMON sense. With years of that work done, selling in Tesla gives the impression of false confirmation of the propaganda, begetting more selling.

I think we would do well to call out specific falsehoods and the general propaganda campaign at every turn so it is as common to hear the propaganda as the calling out of a propaganda campaign aimed to harm Tesla and TSLA.

 

[MonroeSS]

Curt, I'm confused by your comment here. Reducing pollution controls typically increases vehicle mileage (fuel economy). So why would this make buyers be inclined to choose electric on that basis? It seems as if it would have the opposite effect.

GM, FCA and Ford sell millions of passenger cars every year at a loss just for CAFE purposes. ATM any Domestic non-premium car under the size of an Impala is sold at a loss. They not only have to make them available but also sell a significant number of them(CAFE, CARB and other requirements are sales weighted). This forces them to spend billions more to make these cars competitive. So in a nutshell, they spend billions to design/produce/market cars that they end up losing $billions more on. Removing the restrictions clearly benefits them on paper. The actual scenario is more complex than that. They need to keep several factories open and utilize economies of scale for the cars sold outside North America. So removing restrictions may not make them dump passenger cars overnight.

Fewer appealing small cars will definitely help EV sales for those looking for efficient alternatives.

 

[esk8mw]

Guess I'll just buy more at 180 like I always do. Ready to make more buys below 180 as well.

That didn't take long to fill at all. As I said when the election results came in, I expect TSLA back at 150 soon. I'll be buying all the way down.

 

[3mp_kwh]

We've only got a few days left to go until the merger is officially announced as 'going to happen, so you might as well get used to the idea'.

At this point, and ~180 price, is there, or is there not, a camp thinking the merger will be called off? Why is it so crazy to think it will?

 

[3Victoria]

It is very likely calling the merger off would be disasterous.