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

[Ogre]

I'm curious to know what effect the shutdowns in China will have on CATL, BYD, and LG Chem.

That would impact Tesla and their competitors battery supply.

This makes Tesla's investment in in-house cell production that much more critical and highlights exactly how smart it was to start pulling production of this critical resource in-house. The GIGA Nevada and GIGA Texas efforts means Tesla keeps cranking out cells regardless of china.

 

[Ogre]

I think a lot of people are still looking for 'the next Tesla'. I also think as time marches on and Tesla's success becomes obvious, it becomes obvious to more people (retail investors included) that EVs are here to stay, so I believe this promotes EV diversification. If a company new to EV manufacturing doesn't go out of business then most of them are a good buy IF one HODLs with diamond hands.

I know I'm singing to the choir here. But worth pointing out.

"The Next Tesla" will not be yet another EV maker who mimics what Tesla did to get here. It is just not possible.

Tesla is where it is because they made an oblique attack at the auto industry. Tesla has never attacked where legacy auto was strong. New entrants cannot do that against an entrenched competitor. They will just end up so much chum in the shark pool.

Tesla attacked an obscure niche which the big players thought was inviable. They built a product which was better than a traditional car in every way save range and cost. Then they slowly pushed that niche bigger and bigger by increasing range and reducing cost.

Yet another EV company cannot do this, it's already been done. Rivian is not the "Next Tesla"; nor Lucid. They are trying to attack the strength of their biggest rival, they are almost certain to fail or get acquired.

The "Next Tesla" will be a company that comes in at an oblique approach to Tesla. Maybe it'll be VTOL or someone will beat Tesla to automated driving, or who knows. But attacking a dominant player in a market is almost never successful by taking it head on. Small players lack the economies of scale to compete head on. Making an "E Truck" a year or two before Tesla isn't oblique enough. They need a bigger/ stronger differentiator.



PS: I don't think VTOL will replace cars. I also don't see anyone beating Tesla to FSD at this point. Just an examples.

 

[larmor]

I know I'm singing to the choir here. But worth pointing out.

"The Next Tesla" will not be yet another EV maker who mimics what Tesla did to get here. It is just not possible.

Tesla is where it is because they made an oblique attack at the auto industry. Tesla has never attacked where legacy auto was strong. New entrants cannot do that against an entrenched competitor. They will just end up so much chum in the shark pool.

Tesla attacked an obscure niche which the big players thought was inviable. They built a product which was better than a traditional car in every way save range and cost. Then they slowly pushed that niche bigger and bigger by increasing range and reducing cost.

Yet another EV company cannot do this, it's already been done. Rivian is not the "Next Tesla"; nor Lucid. They are trying to attack the strength of their biggest rival, they are almost certain to fail or get acquired.

The "Next Tesla" will be a company that comes in at an oblique approach to Tesla. Maybe it'll be VTOL or someone will beat Tesla to automated driving, or who knows. But attacking a dominant player in a market is almost never successful by taking it head on. Small players lack the economies of scale to compete head on. Making an "E Truck" a year or two before Tesla isn't oblique enough. They need a bigger/ stronger differentiator.



PS: I don't think VTOL will replace cars. I also don't see anyone beating Tesla to FSD at this point. Just an examples.

The next tesla will be the manufacturer that can make cars in large quantities with similar or better gross margins. The EV part is hard but not unachievable. Tesla's secret sauce (not actually secret) is the manufacturing process.

 

[Tronguy]

It's a fine line between good moderating and bad. Free speech should not be confused with the right to run a coordinated disinformation campaign. What is mostly needed is to filter out the trolls, obvious or not, while letting people say (mostly) what they want. It's more difficult than it sounds but some forums are really bad at it.

This investor's forum does a better job of that than many of the other forums on this site (which still have decent moderating). For a look at truly disastrous effects of failing to weed out what should have been obvious trolls, while heavily moderating reasonable discussion (micro-managing every little thing), go take a look at the Model 3 Owner's Club forum. It was a booming place with unlimited potential and the owner turned it into a veritable ghost town by letting sneaky trolls run rampant while simultaneously censoring reasonable discussion simply because it didn't sound happy and polite. The trolls quickly learned they would be allowed to rule the place and, as long as they remained civil and polite, they would be allowed to spread their misinformation freely. Simultaneously, reasonable discussion, if it even hinted towards anything less than ultimate politeness, was heavily frowned upon. What could have been a very valuable site is now a sad shell of its former potential. The lesson here is it's not wise to try to force ultimate civility at the expense of truth and honesty. You cannot force people to be 100% polite and gentle at all times and vigorous debate should not be viewed as "confrontational" or as an "argument".

What does this have to do with investing in Tesla? A lot! Because there are a whole bunch of early Model 3 owners who would be millionaire investors by now had they not been led astray by the army of trolls that freely roamed the forums there, masquerading as legitimate Tesla fans while making up and amplifying anything and everything negative while simultaneously running off people with more logical analyses. This created the wrong impression of TSLA's performance as a company and the likely coming appreciation of their shares. It decreased the pool of potential investors (making them poorer for it) and depressed the share prices slightly lower than they would otherwise have been at any given point in time. Forum members who saw through the BS went looking for greener pastures leaving the dregs behind. Forum management actually thought they were providing balance by letting these people spread their endless negativity and preventing the place from turning into an echo chamber. I want to emphasize that I'm not talking about people who simply had a different perspective, I'm talking about forum members who had the obvious and sinister goal of dissuading people from buying the cars and the stock and yet were allowed to roam freely as long as they remained polite and civil.

People here should realize how good you have it. Nothing is ever perfect, but it's a whole lot better than it could easily be as evidenced by so many other Internet forums where management and moderators don't have a clue what they are doing.

And, just chiming in a bit, may I present the other Tesla forum that, due to a lack of any serious moderation, also went down for the count: forums.tesla.com/forums. Originally set up by Tesla as a place for Tesla owners to chat amongst themselves with little to no moderation. Overrun by trolls, short sellers, and idiots, despite valiant attempts at self-moderation that, in the end, didn't work.
Towards the end, there was some evidence that there were paid disruptors on that forum, with single (supposed) entities having multiple actual people typing on the keys in order to keep the flow going 24/7. It was bad. Missed the good guys, don't miss the bad guys.
And, once in a while, one can sort of tell when a troll or, worse, a paid troll, makes a run at some TMC forum or other. They don't last long. Thank goodness.

 

[lafrisbee]

YOU guys that have the extra special crystal ball that lets you see capping an' stuff...
Well? Share please.

 

[jbcarioca]

I'm gonna ad another dimension - IF (big IF) FSD works /w automated SUC - then all those Cars can grid stabilize during idle anyway - Tesla could clean/tire-rotate during SUC Session - the car would be a Megapack 30-40% and a Robotaxi 50% of the time - my mind is exploding as I type.

Tesla could even use AI to analyze/predict grid usage and proactively route Teslas to take excess power or provide power in some circumstances.
...

You might want to look at this:

Hornsdale Power Reserve - South Australia's Big Battery

The Hornsdale Power Reserve is the world’s first big battery. The first 100 MW saved SA consumers $150 million over two years. It was expanded by 50 MW in 2020.

hornsdalepowerreserve.com.au

and this:
tesla-software
and this:
autobidder
Tesla has been doing all that and much more in commercial production since late 2017.
They have not used cars as participants, but have used many independent distributed power sources.
Tesla Grid Services have been a huge competitive advantage of Tesla commercial stationary storage.
The limitation, as always has been battery supply.
Several manufacturers have been and ar trying to use BEV sources for grid stabilization. Thus far it seems that has not been terribly practical, primarily because of the cost to enable vehicle- to -grid. Many are trying, and CharIN even has standards published.
Now tesla has numerous Superchargers grid connected and GF Austin is about to become the largest ever commercial deployment, if rumors are correct. I am convinced that is correct and Grüneheide might end out being next.

 

[Sancho]

It’s obvious from Elon’s tweets and the purchase of 9.9% that Elon is about to get very aggressive with Twitter. Towards what end we can only speculate.

But as this relates to Tesla, this exemplifies another huge asset that Tesla has. And the asset I’m referring to is the ability of the CEO to use a combination of great wealth, renown, business savvy and aggressiveness to influence every aspect of the Tesla business.

Take, for example, a supplier of parts to Tesla, in which Tesla is not a particularly big customer, so the leverage Tesla has over that supplier as a customer is small. But if you are the CEO of that supplier are you gonna mess with Elon? The leverage that ELON has adds mountains to the leverage that Tesla as a company has.

I can think of only a handful of companies currently and historically where the CEO had this kind of wealth, but none in the history of business where the CEO had this combination of wealth, influence, social media power, business savvy and business aggressiveness that would cause the entire planet to think twice before screwing around with.

You won’t find this asset on the balance sheet, but it’s very valuable.

 

[Artful Dodger]

TL;dr Model the number of assembly lines (not the number of Gigafactories), and model individual 'S' curves for each of those lines.

Let's skip to the year end run-rate: (2022)

• Tesla will have ten (10) total GA lines for Models 3/Y:
  • Fremont: 2
  • Shanghai: 4
  • Texas: 2
  • Berlin: 2
• each line is sized for ~750 cars / day
• that's ~7,500 Models 3/y per day
• that's 2.5m/yr run rate (once supply chains localized).

Show me the Monkey!

 

[Ogre]

The next tesla will be the manufacturer that can make cars in large quantities with similar or better gross margins. The EV part is hard but not unachievable. Tesla's secret sauce (not actually secret) is the manufacturing process.

That is a huge part of Tesla's competitive edge. But it's not a piece that a startup can attack. The nature of the industry makes it impossible to go from zero to 1m units/ year. Just sourcing materials at this point is damned near impossible for a startup. There has to be some other edge or angle which makes it difficult for Tesla to react.

Maybe VW could get to where they are producing cars cheaper than Tesla, but they wouldn't really be "The Next Tesla" at that point would they?

 

[Singuy]

The next tesla will be the manufacturer that can make cars in large quantities with similar or better gross margins. The EV part is hard but not unachievable. Tesla's secret sauce (not actually secret) is the manufacturing process.

Hence why there wouldn't be a next tesla. The task is daunting. Tesla wants to compress what it took multiple auto makers to do in 80 years down to 20 years. 20-30 million cars by 2030 is not even something Toyota or Vw can do with near century long experience. The number is so absurd that zero wall street analyst has it in their model as guided by Tesla.

This pie in the sky goal is only achievable if you started maybe 5 years go. By 2026, Tesla would have locked up the majority of EV share's natural resources and supply chain leaving bread crumbs for others. There was a time when Tesla's mission was just to accelerate this transition, however their mission statement became "we are the transition"--->master plan part 3, scale to extreme size.

 

[Artful Dodger]

TSLA has now returned to the SP range it saw during the first 3 days of 2022:

Cheers to the Longs!

 

[wipster]

It’s obvious from Elon’s tweets and the purchase of 9.9% that Elon is about to get very aggressive with Twitter. Towards what end we can only speculate.

But as this relates to Tesla, this exemplifies another huge asset that Tesla has. And the asset I’m referring to is the ability of the CEO to use a combination of great wealth, renown, business savvy and aggressiveness to influence every aspect of the Tesla business.

Take, for example, a supplier of parts to Tesla, in which Tesla is not a particularly big customer, so the leverage Tesla has over that supplier as a customer is small. But if you are the CEO of that supplier are you gonna mess with Elon? The leverage that ELON has adds mountains to the leverage that Tesla as a company has.

I can think of only a handful of companies currently and historically where the CEO had this kind of wealth, but none in the history of business where the CEO had this combination of wealth, influence, social media power, business savvy and business aggressiveness that would cause the entire planet to think twice before screwing around with.

You won’t find this asset on the balance sheet, but it’s very valuable.

So should Tesla add an asset called "Elon" to the balance sheet? Would it be considered Goodwiil? Bear in mind there are times when it/he has been a liability too (at least to the SP).

/s

 

[Ogre]

TSLA has now returned to the SP range it saw during the first 3 days of 2022:

View attachment 790019

Cheers to the Longs!

On days like today I prefer to express returns to my wife in terms of number of Cybertrucks we can buy rather than as percentages.

Side note: 2 more days like today and we're back at the ATH.

 

[Ogre]

So should Tesla add an asset called "Elon" to the balance sheet? Would it be considered Goodwiil? Bear in mind there are times when it/he has been a liability too (at least to the SP).

/s

Here is a very sobering thought.

If something were to happen to Elon, what happens to the SP? What happens to Tesla's long term prospects?

I don't think it would be necessarily disastrous, but best case would be something like what happened with Apple. There would be a decade or more of quiet profit taking, but the globe changing innovations and huge ambitions would greatly slow. Projects like Optimus would quietly drop off the radar.

Sort of like the ultimate Tesla black swan.

 

[jbcarioca]

Hence why there wouldn't be a next tesla. The task is daunting. Tesla wants to compress what it took multiple auto makers to do in 80 years down to 20 years. 20-30 million cars by 2030 is not even something Toyota or Vw can do with near century long experience. The number is so absurd that zero wall street analyst has it in their model as guided by Tesla.

This pie in the sky goal is only achievable if you started maybe 5 years go. By 2026, Tesla would have locked up the majority of EV share's natural resources and supply chain leaving bread crumbs for others. There was a time when Tesla's mission was just to accelerate this transition, however their mission statement became "we are the transition"--->master plan part 3, scale to extreme size.

Just remember that Elon Musk is so wildly improbable that nearly everyone would have written him off before he left Queen's. The next one is likely to be equally improbable. He is not actually unique, just as rare a creature as was Michelangelo, Einstein, Curie or others as stellar. We need not deify him nor regard him as a messianic figure. We all need to be grateful that we are living to be a part of this one.
Unless the human race extinguishes itself there will be others.

 

[mongo]

Let's skip to the year end run-rate: (2022)

• Tesla will have ten (10) total GA lines for Models 3/Y:
  • Fremont: 2
  • Shanghai: 4
  • Texas: 2
  • Berlin: 2
• each line is sized for ~750 cars / day
• that's ~7,500 Models 3/y per day
• that's 2.5m/yr run rate (once supply chains localized).

View attachment 790003

Show me the Monkey!

I can't find the references now, but I thought the Berlin tour article was updated to say there was a second body line going in, not a GA line. Can you shoot me a link if you have it handy?
I'm thinking one GA line twice as long is more space and material flow efficient than 2 shorter parallel lines; but that could just be circular confirmation bias.

 

[Christine69420]

View attachment 789976

I don't have a mountain to get in shape - so what do I know - even if I am of the feline persuation - but FYI there exists powerful machines running on electricity. So excavators, dozers etc don't need to run on diesel. Just FIY and with lots of

I know I'm singing to the choir here. But worth pointing out.

"The Next Tesla" will not be yet another EV maker who mimics what Tesla did to get here. It is just not possible.

Tesla is where it is because they made an oblique attack at the auto industry. Tesla has never attacked where legacy auto was strong. New entrants cannot do that against an entrenched competitor. They will just end up so much chum in the shark pool.

Tesla attacked an obscure niche which the big players thought was inviable. They built a product which was better than a traditional car in every way save range and cost. Then they slowly pushed that niche bigger and bigger by increasing range and reducing cost.

Yet another EV company cannot do this, it's already been done. Rivian is not the "Next Tesla"; nor Lucid. They are trying to attack the strength of their biggest rival, they are almost certain to fail or get acquired.

The "Next Tesla" will be a company that comes in at an oblique approach to Tesla. Maybe it'll be VTOL or someone will beat Tesla to automated driving, or who knows. But attacking a dominant player in a market is almost never successful by taking it head on. Small players lack the economies of scale to compete head on. Making an "E Truck" a year or two before Tesla isn't oblique enough. They need a bigger/ stronger differentiator.



PS: I don't think VTOL will replace cars. I also don't see anyone beating Tesla to FSD at this point. Just an examples.

So true! The next Tesla will be far off the EV track. Something not yet considered. Like everybody believed a car had to be fossil fueled to be lust-worthy. Something that surprises most of us.

So the odds of me being in early on that company is slim. Which is OK since I got in on Tesla years ago. Can't expect to get that many holes in ones.

 

[Gigapress]

5 days off for Chinese New Year was expected (not 4), and would have been planned for in logistics. All China takes that week off.

Model last year's numbers to see what I mean.

Production breaks can be planned for, but time off is still time off and the factories sit idle.

In the extreme, if production was already at 100% full throttle, then there's no ability to trade extra production in one time period to make up for idling in another. This is possible only to the extent that there's slack in the system. Tesla already runs close to 100% at all times with very little slack and very little inventory throughout the value chain. This is efficient but makes for significant variability in monthly production when any flow disruption occurs for any reason.

I just modelled last year's numbers around Chinese New Year, and I see that it's probably not as extreme as I had been modeling earlier today, but it still seems that the downtime had a significantly negative effect. For Shanghai in 2021, February was the 2nd worst month for growth, excluding a major anomaly in June.

(I don't know what caused that June drop...I'd guess some kind of factory upgrade, considering that average monthly growth rate increased by 70% after June, compared to growth for Jan thru May.) ​

Across 2021, the average increase of the MoM production divided by the number of calendar days was 123 vehicles/day/month, whereas February was merely 43 v/d/m, which is a gap of 80 v/d/m in the typical growth trend which is around 2400 veh/mon of lost growth. At their 800 veh/day rate back then, that suggests they lost approximately 3 days worth of production opportunity. Emphasis on "approximately", as the MoM growth line was highly variable.

Shanghai Growth
Month	Production	Prod per Calendar Day	Delta
Jan 2021	24,819	801	-
2/1/2021	23,632	844	43
3/1/2021	30,791	993	149
4/1/2021	30,494	1,016	23
5/1/2021	36,861	1,189	173
6/1/2021	30,896	1,030	-159
7/1/2021	37,052	1,195	165
8/1/2021	41,754	1,347	152
9/1/2021	50,258	1,675	328
10/1/2021	55,554	1,792	117
11/1/2021	56,917	1,897	105
12/1/2021	66,759	2,154	256

The raw data in the Production column came from Rob Maurer’s last update.

 

[snellenr]

Macros and Short of Elon doing something off the rails aside...is there anything that can really derail $TSLA from getting to $2k by EOY?

A split?

 

[2daMoon]

Never a sure thing with anything....but i sure would like to see your mountain

A statement like that is a good way to have a hit squad standing by with you in the cross hairs, at least until she groks your intent and categorizes you as either threat or no threat.

Just ask the dog...

/s