Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[CorneliusXX]

300K+ amazing quarter and of course Gordon is trying to find the downside.

https://twitter.com/x/status/1477990210789011458

This has already been corrected by moneyball.

https://twitter.com/x/status/1477926342343598081

 

[ZeApelido]

Think of the average intelligence and remember than 50% of the population is below that.

https://twitter.com/x/status/1477991141513449475

 

[nativewolf]

Ford revealed the electric F-150 at 2008 SEMA. Bringing it to market 14 years later is not anybody's definition of "rapid", it shows that they sat on their butts for an entire decade while Tesla was actively working to bring the technology to market.

I find it curious that you identify Tesla as the one with a "battery problem" while Ford just needs to be to "allocate enough battery capacity". The only manner in which Ford impresses is when comparing them to GM. If you want to know what it means to be impressive, look at Tesla, not Ford.

It's because Tesla can sell every car already and every battery is sold. A year in advance. Ford has only launched the one vehicle, the ford mach e. That's the only competitor for battery capacity and battery capacity is not the only limiting factor for the mach-e. Thus, Ford may not be as limited in terms of capacity as Tesla. The SK factory(2) in GA are beginning production shortly-months away, then over the next 3 years they'll ramp up 4 more factories. 3 of those are just for Ford. I have no idea how much they have contracted out of SK until 2025. Until 2025 Ford is going to be quite limited. It's all pouch design though and basically stolen from LG so that ...is concerning if you are Ford. They are forewarned though. For now though it is mache or the lightening. If I am Ford I put it all on the Lightening because the margins will be insane. I'd raise prices too. To be clear, I just think Tesla has more options and the CT is not the best option at this point. Also, unlike most of you I NEED a new truck and having to repair a F350 pisses me right off but then I drove it across boulders in a stream so it is getting fixed. I NEED a CT. Most of you cats just want a new toy.

Your first statement. Yes Ford was planning on a major EV initiative and building concept cars and buying trademarks. The crash of the economy cratered those plans. Tough as it was for Tesla it was worse for huge established companies. The thing you saw then is nothing like the product you see today that was purely a concept car and used in wheel motors for heavens sake. New team, new design, new effort. Ford was prepared for the market crashing (having mortgaged everything for cash) and thus didn't need the bankruptcy bailout GM and Chysler got. In retrospect the USA should have let Chrysler just fail and have given billions to ford to keep on with the electrification efforts (they were just starting). Sadly all got gutted. Ford focused everything on just surviving and then a massive investment in the truck platform to meet milage requirement upgrades from Obama admin. Ah well. Couldof Shouldof Wouldof

As in investor in Tesla it doesn't really matter. Tesla sells every CT it makes for years. Ford and Rivian will sell as many as they can make too at first.

 

[StarFoxisDown!]

Your analysis is contradicted by history — in past blowout quarters, we’ve almost always seen huge pre-market run-ups that get completely bled off over the course of the regular trading day.

Not a prediction, just an observation.

The time between P/D numbers and earnings all throughout 2020 were the biggest gains of the year and then that trend reversed in 2021......which means it can reverse the trend at any time.

But as I've mentioned before, there's really no usefulness in looking at past trends in stock action because the scale of Tesla's deliveries now. Wall St wasn't "dumb" to the idea of what each delivery report meant for Tesla and its earnings. Tesla smashing delivery records when it's Foward P/E would still 400-500 doesn't mean Wall St has to act on it and gives them plenty of buffer to stall the stock or drop it even on blowout delivery numbers.

Now though you're talking about delivery numbers that Wall St can easily plug into numbers for earnings that mean a Forward P/E of under 100. This fundamentally will change the way TSLA gets traded going forward. If the stock was trading at like 1500/share right now then sure, Wall St would still have at least some buffer to stall the stock.

 

[Singuy]

Think of the average intelligence and remember than 50% of the population is below that.

https://twitter.com/x/status/1477991141513449475

The numbers are so good they think it's fraud. That's when you know it was nothing but extraordinary!

 

[Mike Smith]

The analysts who are most ashamed of themselves tend to come out with their notes first, wanting to be forgotten in the wave of other analyst notes coming throughout the week.

 

[Krugerrand]

It's because Tesla can sell every car already and every battery is sold. A year in advance. Ford has only launched the one vehicle, the ford mach e. That's the only competitor for battery capacity and battery capacity is not the only limiting factor for the mach-e. Thus, Ford may not be as limited in terms of capacity as Tesla. The SK factory(2) in GA are beginning production shortly-months away, then over the next 3 years they'll ramp up 4 more factories. 3 of those are just for Ford. I have no idea how much they have contracted out of SK until 2025. Until 2025 Ford is going to be quite limited. It's all pouch design though and basically stolen from LG so that ...is concerning if you are Ford. They are forewarned though. For now though it is mache of the lightening. If I am Ford I put it all on the Lightening because the margins will be insane. I'd raise prices too.

Your first statement. Yes Ford was planning on a major EV initiative and building concept cars and buying trademarks. The crash of the economy cratered those plans. Tough as it was for Tesla it was worse for huge established companies. The thing you saw then is nothing like the product you see today that was purely a concept car and used in wheel motors for heavens sake. New team, new design, new effort. Ford was prepared for the market crashing (having mortgaged everything for cash) and thus didn't need the bankruptcy bailout GM and Chysler got. In retrospect the USA should have let Chrysler just fail and have given billions to ford to keep on with the electrification efforts (they were just starting). Sadly all got gutted. Ford focused everything on just surviving and then a massive investment in the truck platform to meet milage requirement upgrades from Obama admin. Ah well. Couldof Shouldof Wouldof

As in investor in Tesla it doesn't really matter. Tesla sells every CT it makes for years. Ford and Rivian will sell as many as they can make too at first.

I am going to relish the demise of your beloved Ford.

 

[raffiniert]

300K+ amazing quarter and of course Gordon is trying to find the downside.

https://twitter.com/x/status/1477990210789011458

oh man, I spent 10 minutes going down that rabbit hole of this tweet until I was reading antisemitic crap. Where can I get my 10 minutes back??

 

[Unpilot]

oh man, I spent 10 minutes going down that rabbit hole of this tweet until I was reading antisemitic crap. Where can I get my 10 minutes back??

You can't. Twitter is a cesspool and time sink and IMHO a total waste of time.

Tesla should buy it and FB and shut both down.

The GHI (Global Happiness Index) would immediately soar.

 

[jbcarioca]

I actually don't agree with this: I think the ASP per car will be maintained at $50K. And that's because 10 M of those 20 M cars will be Model 1 / Robotaxis and will of neccessity include FSD at $35K (for arguement's sake). Throw in $15K for the hdw for this city hauler, and that's $50K right there but with a gross margin of 70%.

Further, I expect Tesla to buy around half of their production for their own TN service, selling just enough Robotaxi's to fleet operators to pay the upfront costs of building the fleet. The ROI will be huge, with a 10-yr life expectancy and over $50/yr avg revenue.

TL;dr Don't worry about declining ASPs... Robotaxi fixes everything, and takes Tesla to a new level of profitability.

Cheers!

I may not agree with your logic but I agree with your ASP conclusion.
1. Remember Cybertruck? If they sell even at F-150 Lighting levels they'll contribute to maintaining ASP.
2. Remember Model Y? It is at the highest volume category for many countries and production capacity will at least triple within the next year.
3. S and X are not disappearing. Almost every one of those has an ASP of US$100,000 or more.
4. Then there will be the odd Semi or Roadster. Not many but very much useful for raising average ASP.

So there will be at least the $50,000 average ASP even with high volumes of new small vehicles. but...
5. Every small vehicle will have a Performance or other high spec version, yielding higher average ASP.

We need to speculate about FSD or Robotaxi. Those may happen but there is no clear notion of timing. Still,
many all of us seem fixated on ASP when the real issue is Gross Margin and Capex. Here we have evidence:
6. Capex is entirely funded from cash flow. This in a company growing at >50% per annum. The operative word is "unprecedented".
7. Manufacturing innovation is progressing at an "unprecedented" rate, and is actually allowing the antiquated Fremont factory to keep increasing production and Shanghai to exceed planned production capacity and keep growing.

All of the above points have been made repeatedly but it is difficult to absorb their totality. We try, but it's difficult. We strive for analogies, but really there aren't good ones. The Thomases (Edison and Crapper) the Henry's (Firestone and Ford), James Watt, Cyrus McCormick, Karl Benz, Isaac Singer, Edwin Land and so on, show people who have revolutionized the industrial world. Some became legendary. But...

In Elon Musk we have someone who has revolutionized consumer banking, rocketry, automobiles and more but he actually has contributed the most by building factories. SpaceX and Tesla achieve most of their success because they both build things so well. Skipping the hyperbole, the point of this all is that ASP is irrelevant, Cash Flow is relevant. SpaceX would not exist were it not for reusable rockets, and that was manufacturing innovation. Tesla would have died had it not been for the BMS and continuous manufacturing improvement.

So, ASP is a red herring! Cash flow rules! Elon Musk describes things in other terms, mostly. He repeats the mantra of manufacturing innovation, FAST cash conversion cycle and product innovation for cost reduction.

None of those famous people have combined these elements in just this way. That is why we have no useful precedent.
None of those people, have cultivated excellent and passionate people is quite the way he has done.
Most of the world tends to see his flaws and think TSLA shares his flaws. Mostly TSLA does not have those flaws. Probably one: a tendency to ignore some important parts of buyer support. I think they'll grow out of that one.

This diatribe courtesy of my brother-in-law and his spouse, who yesterday spent hours grilling me on these and related points.

 

[Buckminster]

Some charts:

Deliveries broken down by model based on P&D report

View attachment 751053

Deliveries vs. Share Price (last day of quarter)

View attachment 751059


Reported Installed Capacity (only in Earnings Reports) vs. Actual Deliveries...they broke the barrier for how much they think they're allowed to build in Q4/2021 based on the reported Installed Capacity since a year ago Q4/2020.

View attachment 751055

That previous charts, but with share price.

View attachment 751058

Post of merit nomination.

LFP patents in the USA expire April 2022. That completely changes the game for energy storage.

Changes vehicle game also. All M2, M3 and MY SR vehicles could be LFP in a year - worldwide.

 

[CLK350]

The FUD is getting really desperate - blowing up a 2013 Tesla .. meh .. BULLISH !

https://edition.cnn.com/videos/us/2021/12/30/tesla-exploded-dynamite-repair-costs-22k-moos-pkg-vpx.cnn

 

[aronth5]

Thanks for bringing us back to reality with a slap in the face. You're right, the fact that actual "work" remains to be done to accomplish anything makes me realize maybe Tesla is not the right fit for this job. Tesla workers are better at dreaming than actually getting anything done!

/s

This thread has a long history of being told that the cleaning of robo-taxis is a difficult problem to solve. We are accustomed to being told things can't be done. We listen to the objections, consider them briefly and then dismiss them as an easy problem to solve. If you want to get good at solving problems, emulate the culture at Tesla. They are accustomed at looking at the paths around the problem. You will find there are many ways to skin a cat and a problem that looks insurmountable is rarely ever that as long as it doesn't violate the laws of physics.

I would bet in the next 2-4 years Tesla will disrupt the insurance industry more then it will create a new robotaxi industry. Every FSD sale becomes an insurance opportunity to switch over to Tesla. The same cannot be said for robotaxi services at least in the short term which will be difficult to implement as a service entity.

 

[mickificki]

https://twitter.com/x/status/1477991342940856322

 

[Unpilot]

I may not agree with your logic but I agree with your ASP conclusion.
1. Remember Cybertruck? If they sell even at F-150 Lighting levels they'll contribute to maintaining ASP.
2. Remember Model Y? It is at the highest volume category for many countries and production capacity will at least triple within the next year.
3. S and X are not disappearing. Almost every one of those has an ASP of US$100,000 or more.
4. Then there will be the odd Semi or Roadster. Not many but very much useful for raising average ASP.

So there will be at least the $50,000 average ASP even with high volumes of new small vehicles. but...
5. Every small vehicle will have a Performance or other high spec version, yielding higher average ASP.

We need to speculate about FSD or Robotaxi. Those may happen but there is no clear notion of timing. Still,
many all of us seem fixated on ASP when the real issue is Gross Margin and Capex. Here we have evidence:
6. Capex is entirely funded from cash flow. This in a company growing at >50% per annum. The operative word is "unprecedented".
7. Manufacturing innovation is progressing at an "unprecedented" rate, and is actually allowing the antiquated Fremont factory to keep increasing production and Shanghai to exceed planned production capacity and keep growing.

All of the above points have been made repeatedly but it is difficult to absorb their totality. We try, but it's difficult. We strive for analogies, but really there aren't good ones. The Thomases (Edison and Crapper) the Henry's (Firestone and Ford), James Watt, Cyrus McCormick, Karl Benz, Isaac Singer, Edwin Land and so on, show people who have revolutionized the industrial world. Some became legendary. But...

In Elon Musk we have someone who has revolutionized consumer banking, rocketry, automobiles and more but he actually has contributed the most by building factories. SpaceX and Tesla achieve most of their success because they both build things so well. Skipping the hyperbole, the point of this all is that ASP is irrelevant, Cash Flow is relevant. SpaceX would not exist were it not for reusable rockets, and that was manufacturing innovation. Tesla would have died had it not been for the BMS and continuous manufacturing improvement.

So, ASP is a red herring! Cash flow rules! Elon Musk describes things in other terms, mostly. He repeats the mantra of manufacturing innovation, FAST cash conversion cycle and product innovation for cost reduction.

None of those famous people have combined these elements in just this way. That is why we have no useful precedent.
None of those people, have cultivated excellent and passionate people is quite the way he has done.
Most of the world tends to see his flaws and think TSLA shares his flaws. Mostly TSLA does not have those flaws. Probably one: a tendency to ignore some important parts of buyer support. I think they'll grow out of that one.

This diatribe courtesy of my brother-in-law and his spouse, who yesterday spent hours grilling me on these and related points.

Nominate above for post of important merit.

 

[nativewolf]

I am going to relish the demise of your beloved Ford.

Well your avatar is a cat...maybe you hadn't noticed. So we know you just relish destruction in general.

I am guessing Ford doesn't hit the demise button. We'll see. Gm though? Yes. Toyota...hmmm Yes I think. Honda...Sadly yes. VW...Oh I hope so but I doubt it. BMW- Yes, MB...Yes. and on and on.

 

[wtlloyd]

that would assume that by 2026 or so they have solved FSD. I'm in agreement on some aspects of what you are saying but given the history on FSD that may be ambitious. That would give them only 2-3 years to solve the non technical but very challenging regulatory hurdles. Those hurdles don't exist because the cars don't exist. Then they with have a market acceptance kind of issue. Then lots of service issues (who's cleaning the cars and don't tell me robots- cleaned a car where someone has vomited or used as a portable toilet) and Tesla service is not a strength. That requires a completely different culture. Go visit enterprise local office and see the sales folks pickup a bucket and rags and get to work cleaning if a customer is waiting. That's the culture. Social media of nasty robotaxis will be a killer. Robotaxis are not something where you'll flip a switch and make profit. Personally I think, culturally, that Tesla has work to do to launch a successful service business.

Not in disagreement about the timeline for FSD.
That's a disappointing miss on your vision of how a Robotaxi vehicle would operate. It will be purpose-built, not just a bunch of model 3's thrown out on the street. They will be designed to be easily cleanable and sanitized, but the image of routine vomiting and pooping in the vehicle - there will be interior cameras, whoever hails the vehicle using the app will be responsible for the riders within. Urban RTs will be kept in a hive building, returning for re-charge and any other necessary duties performed by service staff. There is NO interaction between riders and service employees, there is NO comparison with current rental car practices and what is coming. It's like saying automobiles are no good because you can't fit a saddle to them.

 

[2daMoon]

Just woke up, (still un-woke ) and need some coffee.

Was there supposed to be something I was planning to look into this morning?

Maybe it was the SP or along those lines. Can't remember. Gonna go get that cuppa and see if the fog lifts.

HODL

 

[jbcarioca]

I don’t see why Tesla would give up the 18650 capacity for Model X and S that quickly. They just redesigned those two and I expect them to keep using 18650 for years

They might. However, they just might begin making those conversions as soon as possible. Are there any 2170 suppliers who are NOT developing 4680 capacity?
The question probably is the relative benefit in using legacy production rather than converting.

The analogy that may be most relevant is the one Sandy Munro keeps talking about; designing now products from the legacy parts bins.

How long will Tesla stay with an obsolete cell design and form factor?

 

[Artful Dodger]

View attachment 751370

A meer 7% increase ?
I would have thought 10-12 % a more appropriate number.

I remind the group that the Upper Bollinger Band sat at about $1,129 on Friday's Close, and we're setting up to Open near that level today:

Don't be surprised to see some selling/profit taking today. But keep in mind, Tesla is a TRILLION dollar company growing at 87% and destined to become the World's most valuable company within a few years.

IMO, we're very likely to revisit the ATH of $1,244 before Q4 Earnings, but I also don't see any reason why that should be a 'cap' (other than "Burry Worries"). Especially if the BoD finally splits the dam stock! Let's GO!

Cheers to the Longs!