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

[thesmokingman]

Not sure if it was discussed here yet, but I'm reading this update on the competition....

Ford asks dealers to invest in EVs as it chases Tesla-like profit

The automaker is asking its nearly 3,000 dealers to invest upward of $1 million for upgrades to sell all-electric vehicles.

www.cnbc.com

It sounds like me trying to defend the SolarCity business model in 2015.

I mean.....Ford absolutely cannot compete with Tesla on margins, even if they had a zero cost dealer-free distribution system.

Now they want dealers, who are 100% gonna lose all profit after the maintenance-free EV takes over, to "invest" $1M in order to be allowed to sell EVs. The EVs that are 100% going to lead to their demise. Lol!

In many ways it's a great move by Farley to put the onus on the dealership network. But it simply reframes the same trainwreck. He's supposed to be avoiding the trainwreck.

I tend to think of this as a way to force those who don't pay to exit the game. It's a fundamental flaw, the legacy dealer network is a huge hindrance if they are trying to copy Tesla. How better to trim that fat than to require a ridiculous sum that most dealers won't be able to pay?

 

[Rammstein]

MODERATOR-ALTERED POST

I’ve been alerted that posters neither see a précis as to why a post is deleted, nor even by which Mod. Assuming this is so - we baklava-munchers high atop Mt. Olympus mightn’t be aware of all occurring to hoi polloi - then this morning what is turning to smoke on the Altar of OnTopicness can be discerned by by their color, as well as the identical alteration of the post.

With that, today‘s message is: NO more numerology. Ox entrails are less mind-stultifying, as well as less inaccurate.

 

[thesmokingman]

MODERATOR-ALTERED POST

I’ve been alerted that posters neither see a précis as to why a post is deleted, nor even by which Mod. Assuming this is so - we baklava-munchers high atop Mt. Olympus mightn’t be aware of all occurring to hoi polloi - then this morning what is turning to smoke on the Altar of OnTopicness can be discerned by by their color, as well as the identical alteration of the post.

With that, today‘s message is: NO more numerology. Ox entrails are less mind-stultifying, as well as less inaccurate.

 

[Speedr117]

current market cap / current price = number of shares

desired market cap / number of shares = price to hit that market cap

Pre-split price was easy, pretty much you would times the stock price by a billion to get the market cap (i.e. $1,000 stock equals $1 trillion market cap). Now it's 3 billion. And before anyone points out the obvious, this is an ESTIMATE. It's not exact.

 

[UncaNed]

Tesla won't quit trying to expand in Germany, but I really wouldn't mind if they put it on the shelf and went elsewhere.

...like back to China, expand there, and just keep shipping to Germany.

 

[Ogre]

I can’t believe that Amazon is not only worth more than Tesla, but somehow worth almost as much as Google. It’s honestly absurd. Amazon is easily the most overvalued mega-cap.

Amazon is fairly well entrenched. They have a moat (sort of) and are doing things Wall Street understands well enough. Even though they are not hugely profitable the way Apple is or growing as fast as Tesla, Wall Street likes things like a massive subscriber base.

What's curious is since Bezos left, maybe before, they've been somewhat listless. They've weirdly turned into UPS with bad drivers and a business logistics company as much as anything. Very hard to compete with their e-commerce.

I think Amazon is valued where it is because it's perceived as a fortress. I'm not sure that perception is wrong myself, but soon I think they are going to have to start sharing profits with shareholders in some way.

(Sold all my Amazon, but personally I think the disconnect is mostly that Tesla is way undervalued)

 

[henchman24]

At this point, I think it’s an actual risk for Tesla to keep investing in Germany. They need to diversify to at least one other country to put constant pressure on the German government. To me at least, the German officials have shown time and time again that they can’t be relied on.

I'd say some factory decisions going forward should be about taking away some risk. IE there should be somewhere in Asia that can take some reliance away from Shanghai (Indonesia continues to make sense there). Eastern NA should have the ability to easily export to Western Europe. etc

 

[Prunesquallor]

I tend to think of this as a way to force those who don't pay to exit the game. It's a fundamental flaw, the legacy dealer network is a huge hindrance if they are trying to copy Tesla. How better to trim that fat than to require a ridiculous sum that most dealers won't be able to pay?

I smell many lawsuits.

 

[henchman24]

...like back to China, expand there, and just keep shipping to Germany.

I think future factories should include backup plans on how to fill demand as delays like this happen. Eastern NA should have the ability to export to Western Europe LHD countries. Indonesia (if it happens) should provide for the RHD countries.

 

[Ogre]

I little more info on Ford's dealership ultimatum:

Ford is giving its dealers until October 31st of this year – less than two months – to make a decision that will have huge implications for the future of the franchise. The company is offering its dealers three options:

• Become a Model E Certified Elite dealership
• Become a Model E Certified dealership
• Discontinue selling Model E vehicles effective January 1st, 2024

Ford explains that its Model E dealership strategy will be built upon five pillars:

• Training: Dealers will need to undergo extensive EV training on an ongoing basis
• Charging: Model e dealers must have adequate level 2 and DC fast charging, with at least one DC fast charger available to the public
• Set Pricing: Transparent, non-negotiable pricing available online
• Excellent physical experience: Model e dealers must deliver an excellent ownership experience, including complimentary pickup and drop off for vehicle service visits
• Develop digital experience: Invest in building a digital ownership experience for the future

The new rules for Model e dealerships require dealers to post set prices for the electric vehicles online at Ford's website. Customers can view the set pricing, complete the purchase online, and even schedule home delivery. But ultimately, it's the dealer's decision what the set pricing will be for the vehicles, and there will likely be price variation from dealer to dealer.

65% Of Ford Dealers Agree To Ford's Tough EV Selling Terms

At its 2022 annual dealership meetings, Ford revealed to its dealer network the new Model e rules they are instilling for dealers that want to sell Ford's EVs.

insideevs.com

Keeping in mind that Farley has only been running this show for 2 years now, he is genuinely starting to grow on my.

I wonder what Ford would look like if he'd been running the show for 10 years. Would he have moved on EVs sooner?

Of course much of these reactions are responses to Teslas growing dominance, but at least he's making the right responses.

 

[SOULPEDL]

Fed has to deal with the rest of the population, not just industrial cues.

Problem we have right now is spiking rents and lack of housing, a shortage with its seeds going back to the Great Recession. We need more housing for that to really relent. The Fed is raising rates, which discourages new housing. A real conundrum for the policy makers in the end.

OT... Exactly, homeless is a growing problem due to inflation. Just ask my son running for city council in Santa Clarita Ca. He's homeless in their own shelter - what a story if he wins. Rent was simply too high for this Math teacher. He's seriously angry and I completely understand.

 

[wtlloyd]

so for a 4T market cap, you'd need a price of about 4,000,000,000,000 / 3,100,000,000 = $1290/share

That's all? Seems doable!

 

[ZeApelido]

MODERATOR-ALTERED POST

I’ve been alerted that posters neither see a précis as to why a post is deleted, nor even by which Mod. Assuming this is so - we baklava-munchers high atop Mt. Olympus mightn’t be aware of all occurring to hoi polloi - then this morning what is turning to smoke on the Altar of OnTopicness can be discerned by by their color, as well as the identical alteration of the post.

With that, today‘s message is: NO more numerology. Ox entrails are less mind-stultifying, as well as less inaccurate.

 

[M|S|M MYP]

Keeping in mind that Farley has only been running this show for 2 years now, he is genuinely starting to grow on my.

I wonder what Ford would look like if he'd been running the show for 10 years. Would he have moved on EVs sooner?

Of course much of these reactions are responses to Teslas growing dominance, but at least he's making the right responses.

Should have had Mr. Levine run Ford....He would have gotten them straightened out by now


/s

 

[thesmokingman]

I smell many lawsuits.

No love for dealers or their powerful lobbyists, so whatever happens it's good for us either way. Let's not forget there's a reason why direct to consumer sales is banned in so may states and who started it.

States banning Tesla direct sales might have a blind spot

Tesla has set out to improve or eliminate aspects of the car ownership experience that consumers don’t like, and car dealers are at the top of that list. From the beginning, the company has sold its cars directly to customers online. However, Tesla has also chosen to open company-owned retail...

evannex.com

 

[Discoducky]

Amazon is fairly well entrenched. They have a moat (sort of) and are doing things Wall Street understands well enough. Even though they are not hugely profitable the way Apple is or growing as fast as Tesla, Wall Street likes things like a massive subscriber base.

What's curious is since Bezos left, maybe before, they've been somewhat listless. They've weirdly turned into UPS with bad drivers and a business logistics company as much as anything. Very hard to compete with their e-commerce.

I think Amazon is valued where it is because it's perceived as a fortress. I'm not sure that perception is wrong myself, but soon I think they are going to have to start sharing profits with shareholders in some way.

(Sold all my Amazon, but personally I think the disconnect is mostly that Tesla is way undervalued)

I don't own or have ever owned Amazon, but Amazon is valued well IMHO as they own the cloud, as well as Google who owns the internet, like Microsoft owns enterprise, Apple owns phones, Facebook owns social and Tesla is on the cusp of owning transportation, energy and eventually autonomous AI. Tesla will be worth more than all combined eventually as Tesla has the vision, guiding principles and innovation prowess.

At least that is how I explain valuation to folks as a 101 class.

 

[elasalle]

I thought CPI and PPI were friends, but market treating them like enemies (one good, one bad )
Great reversal in a day.

 

[TN Mtn Man]

DOW up .4, NASDAQ ~ .8. Meanwhile TSLA up nearly 5. Impressive shrugging off yesterday's bloodbath so quickly.

 

[Discoducky]

Keeping in mind that Farley has only been running this show for 2 years now, he is genuinely starting to grow on my.

I wonder what Ford would look like if he'd been running the show for 10 years. Would he have moved on EVs sooner?

Of course much of these reactions are responses to Teslas growing dominance, but at least he's making the right responses.

It still feels like too much legacy thinking for my taste and Ford's eminent demise is still the most likely outcome with currently public plans. Fed rates will crush Ford finance in short order which is their only profit center.

The legacy ship takes too long to turn. Even I had a hard time going to Google after Tesla as they moved too slow. I had to leave Google to try a startup in order to move faster, but soon realized they didn't have the stomach to move fast enough and went back to a different part of Google that moved faster. It is not only the right thing to do, it is the only way to compete with Elon vision. I imagine Doug Field explained this as he knows it well.

 

[Dreadnought]

Bullish sign, new SA article title: Exploding EV Competition Could Send Tesla Under $100

Love that SA is predicting another 3 5 for 1 split soon...

FTFY.