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

[mongo]

OT

That doesn't explain "why an ICE" rather than an EV, in a continent with high fuel prices, sometimes extra restrictions / fees on ICEs in cities, rather high EV adoption rates, usually good EV incentives, and great EV infrastructure.

Cost of aquiring and maintaining EV for ~3 year time span can be greater than cost of shipping existing car to/ from Europe.

They'll have two cars in Europe. They currently have 2 in the States: one Tesla and a beater that they will replace before they move. Due to export (transfer/ import) issues, there is no reason to buy a second Tesla now (nor does the current usage cycle likely support it). Thus they will have an ICE (chosen to be exportable importable at destination) on hand. Across the pond they'll have a new primary Tesla and a second car they already own. The usage profile (or type) of that second car again may not support being an EV given the timeframe they are going to be in Europe for.

Edit: clarify that the issue is getting car into another country, thanks for the catch @PaulusdB .

 

[schonelucht]

Very nice summary, @ReflexFunds . Hard to fault anything in it. Q1 was certainly lower than sustainable demand, 80k seems very reasonable. I hope we reach that volume in Q3 or Q4 on the latest.

 

[schonelucht]

Im moving next summer but need a car to get from now until then (our current junker is on its last legs). We already have a Tesla, but we cant bring that with us for a number of reasons so we're left with buying / leasing a new tesla in Europe which we will likely do and shipping an ICE over with us.

Where are you going? Anywhere close to a city in Europe, one car is enough, especially if only temporary.

 

[PaulusdB]

OT


Cost of aquiring and maintaining EV for ~3 year time span can be greater than cost of shipping existing car to/ from Europe.

They'll have two cars in Europe. They currently have 2 in the States: one Tesla and a beater that they will replace before they move. Due to export issues, there is no reason to buy a second Tesla now (nor does the current usage cycle likely support it). Thus they will have an ICE (chosen to be exportable) on hand. Across the pond they'll have a new primary Tesla and a second car they already own. The usage profile (or type) of that second car again may not support being an EV given the timeframe they are going to be in Europe for.

On that -exportability-. You should look into the -importability- of your US car as well, @strago13.
E.g. The Netherlands has very friendly terms for expats to bring their car along from abroad. Basically tax free. With the really high local car prices, you could drive your import for three years and still sell it at a profit. Avoid the econoboxes, look at certain types of muscle cars/pickups.

 

[jerry33]

You mean someone who love driving to the point of spending 100k on them but refuse to spend this money if Tesla never existed? Yeah I would say you are very rare and doesn't apply to most people. So you are not in it to help Tesla's mission..you are in it because you love driving...but felt indifferent to driving all your life except after a Tesla? I mean it's possible but definitely not the type of people Elon is trying to lower the price of Teslas for.

Not that rare. Many of us follow that pattern.

 

[Compton]

Not that rare. Many of us follow that pattern.

I also went from a 15k car to 115k model S. Would have never spent more than 25-30k on an ICE vehicle, the most I have ever paid for a car (aside from the S) was 17.5k.

 

[jerry33]

Ya. Cars were just a hassle and a money/time sink.

Then tesla came along and driving is enjoyable again.

Correct. The last car I had that was enjoyable to drive was a 1969 DS-21. That was a long time ago. (However, it did have a couple of features I wish that Tesla would incorporate.)

 

[Singuy]

How about $35,400?

Perhaps you don't know how this reply chain started. The original top was my defense for why Elon's desirability statement. I said it's more than just economic of supply/demand. It's because too many are into the mission but can't afford a 60-90k car so people are putting themselves into hardship trading up.

But the argument here is no no, the mission is secondary. People are willing to spend 50-100k on a car because the car is too good....uhhh yeah all of a sudden Honda Civic buyers are all car enthusiast secret millionaires just waiting for the right car all their lives...

 

[jschwefel]

Correct. The last car I had that was enjoyable to drive was a 1969 DS-21. That was a long time ago. (However, it did have a couple of features I wish that Tesla would incorporate.)

Same here. Before I bought a Model S in 2016, my previous cars were Civics, Camrys and Accords. Now I own three Tesla’s and my only regret is the four years between 2012 and 2016 that I drove an ICE vehicle when I could have been driving a Tesla. As mentioned earlier, Tesla has made driving fun again.

 

[KarenRei]

Very nice summary, @ReflexFunds . Hard to fault anything in it. Q1 was certainly lower than sustainable demand, 80k seems very reasonable. I hope we reach that volume in Q3 or Q4 on the latest.

Will be interesting to see InsideEVs July S/X numbers to compare to April.

 

[ReflexFunds]

Will be interesting to see InsideEVs July S/X numbers to compare to April.

I'm not sure how much faith I have in InsideEVs numbers on a monthly basis.
In June they estimated 20.5k Model 3 and 4.5k S&X - A total 25k. But Electrek reported that Tesla missed its North America June delivery goal of 33k by just 200 cars. ev-sales.blog estimated June Canada sales at 2,750. If we round that up to 3k it still means InsideEVs underestimated US June sales by c.5k.

 

[uselesslogin]

Perhaps you don't know how this reply chain started. The original top was my defense for why Elon's desirability statement. I said it's more than just economic of supply/demand. It's because too many are into the mission but can't afford a 60-90k car so people are putting themselves into hardship trading up.

But the argument here is no no, the mission is secondary. People are willing to spend 50-100k on a car because the car is too good....uhhh yeah all of a sudden Honda Civic buyers are all car enthusiast secret millionaires just waiting for the right car all their lives...

So you think that 1) people are putting themselves into hardship to buy the car and 2) are only doing so because of "the mission" and not because of the vehicle itself?

 

[Singuy]

So you think that 1) people are putting themselves into hardship to buy the car and 2) are only doing so because of "the mission" and not because of the vehicle itself?

78% of Americans live paycheck to paycheck, most having a car loan. The average salary of Americans make 54k/year. The number two thing Americans spend too money on is a car payment. So most Americans are in some kind of hardship already. So combining this plus trading up just makes even less of a financial sense. I mean what is more important? Food on the table or driving dynamic of a car?

So the assumption based on the above data is that the Honda Civic owner bought it because it's the best that owner can afford..not a secret millionaire waiting for Tesla all their lives.

 

[mongo]

"".........The 200m altitude hop test of Starship, planned next week in broad daylight, live streamed by multiple YouTubers with their own cameras on site, is going to be really hard to explain away by the conspiracy theorists. ......""

Next week?!?!? Cocoa Beach?? seriously??!! didnt see it on "nextspaceflight.com"
gotta take a drive up there to visual it in "real time"
200 meters should be visible easily oh boy oh boy!!! yeehaw!!!!
may be able to get niece to take great-niece to visual also so she could be Mars bound in 10-20 yrs
WANDERERS -Short Film

Cocoa Beach is for seeing Falcon landings. The 200m jaunt is Starship hopper at Boca Chica Texas.

 

[Dutchie]

Elon is on Twitter again. Now that the pick-up unveiling is within a few month, software 10 in September with mighty new games and other goodies.
Why does he come out with it now; a couple of days after the earnings call and a disasterous couple of days for TSLA?
Does he want to push the stock? I hope he doesn't think that way but the timing is remarkable. Once again, his timing for release of features is almost always off. I just wish he just shut-up and release the features whenever it is ready. The stock will do its thing then.

Booo.

HaHaHa,

Nothing better than sowing a little controversy. TBH I don't think there is real connection between his statements and the timing of his statements timing after the share drop, but you never know. He is a smart cookie and probably cunning too.

I do stand by my statement that I wish he be quiet about when to expect what kind of improvement to the software. We all have been disappointed in the past with his timeline.

 

[Navin]

I think this is one of many reasons for the weaker S/X demand this year, including:

• Model 3 cannibalisation. This is partly due to the easier to reach Tesla/environmental stretch as you mention above. But also due to the preference for smaller cars in Europe, and just general better value for money for most people's needs on the Model 3.
• 2018 demand pull forward from the tax credit changes in US and Holland.
• The Model 3 reservation book was likely a significant source of S&X demand in 2018 as Tesla pushed reservation holders to trade up to S&X rather than waiting for Model 3.
• Much less favourable EV incentive in US and Holland.
• Overall global automarket collapse
• E-tron/I-pace/Taycan competition. There's no doubt this will have had some impact, partly because the Tesla FUD has driven some people to buy far inferior/worse value for money EVs.
  
• Failure to keep all Model S&X tech ahead of the Model 3 - particularly with the max charge rates.
• People waiting for the "refresh", anticipating a switch to 2170 cells (with expectations of higher charge rates and range) and a new interior.
• Increased volume of off lease S/X cars with second hand 100D cars likely competing with new 75D/SR S&X.
• Model Y osbourning on X.
• Removal of the base 75D/SR models from the menu for much of the year.

There are also several positive factors working to counter this though:

• Much better value for money with lower prices and better specs post Raven update.
• Significantly increased Tesla sales force (customer fleet) which should drive better word of mouth awareness of Tesla's products.
• Continued Supercharger and Service centre expansion increasing the addressable market.
• Model 3 will give Tesla the scale to launch in several new countries which were not worth entering for S&X alone.
• Favourable BIK EV incentive upcoming in the UK. Possible improved incentives in California.

The fall in S&X demand caught many people by surprise this year, partly because many people (including me) expected a more significant refresh to S&X in Q1 to counter the credit change/demand pull forward impact, but also because Model S&X sales held up so well in 2H18 despite the huge level of Model 3 sales in the US. This makes the sudden change in 2019 harder to attribute fully to Model 3 cannibalisation.

I think the lower S&X demand (despite much better value for money) is likely a mix of short and long term factors. We should start to see where sales settle over the next 6 months, and I expect Tesla to continue to make upgrades/updates to the S&X over this period as it always does. My guess is we will get back to around 80k annual S&X at the new price points.

What do you think? @Fact Checking @neroden @KarenRei @Doggydogworld @EVNow

This is great analysis. Would be interesting to zoom out a bit and look at the overall luxury car markets the model S and X compete. How are recent sales trends for model X and S competing with other cars. Is their slice of that pie increasing or decreasing, etc?

 

[Silent Ludicrosy]

78% of Americans live paycheck to paycheck, most having a car loan. The average salary of Americans make 54k/year. The number two thing Americans spend too money on is a car payment. So most Americans are in some kind of hardship already. So combining this plus trading up just makes even less of a financial sense. I mean what is more important? Food on the table or driving dynamic of a car?

There are lots of Americans who can afford to upgrade, but only care about reliable transportation and see little value in a more expensive gas car. I know quite a few people making $100,000+ and driving 10 year old cars that are long paid off.

 

[Krugerrand]

Perhaps you don't know how this reply chain started. The original top was my defense for why Elon's desirability statement. I said it's more than just economic of supply/demand. It's because too many are into the mission but can't afford a 60-90k car so people are putting themselves into hardship trading up.

But the argument here is no no, the mission is secondary. People are willing to spend 50-100k on a car because the car is too good....uhhh yeah all of a sudden Honda Civic buyers are all car enthusiast secret millionaires just waiting for the right car all their lives...

You’re being obtuse in the face of people telling you their outright truth.

You claimed nobody who viewed cars as appliances to get from point A to point B would ever or could ever become a ‘I love cars/I love driving’ person.

You are wrong.

Tesla IS and HAS changed A LOT of point A to point B, cars are appliances people into ‘I love my Tesla so much I make up reasons to drive it because I now love driving.’

*waves hand also*

 

[Krugerrand]

78% of Americans live paycheck to paycheck, most having a car loan. The average salary of Americans make 54k/year. The number two thing Americans spend too money on is a car payment. So most Americans are in some kind of hardship already. So combining this plus trading up just makes even less of a financial sense. I mean what is more important? Food on the table or driving dynamic of a car?

So the assumption based on the above data is that the Honda Civic owner bought it because it's the best that owner can afford..not a secret millionaire waiting for Tesla all their lives.

Did you already forget about all the homes that were foreclosed because somebody gave those people mortgages for homes they couldn’t actually afford?

Have you looked up national credit card debt?

Have you never seen a homeless person walking around with the latest and greatest iPhone?

People notoriously make bad financial and/or bad purchasing choices. That’s not actually what’s going on here with people upgrading from beaters or basic utility vehicles to Teslas.

Two DIFFERENT situations.

I’ve driven used/beaters pretty much my whole driving life until Tesla. Not because I couldn’t have afforded more expensive or new cars, but because I wanted to spend my money on something else or save it for something else, and having a ‘nice’ car wasn’t a priority or necessity or a care. My vehicles needed to be reliable and functional. I got those for bare bones costs because (read above). Now I’ll buy only Teslas because no emissions, because home fueling, because inexpensive long distance travel, because functionality, because reliability, because every possible reason anyone can come up with. Good thing I made wise choices with my money over the years, eh?

 

[Singuy]

Did you already forget about all the homes that were foreclosed because somebody gave those people mortgages for homes they couldn’t actually afford?

Have you looked up national credit card debt?

Have you never seen a homeless person walking around with the latest and greatest iPhone?

People notoriously make bad financial and/or bad purchasing choices. That’s not actually what’s going on here with people upgrading from beaters or basic utility vehicles to Teslas.

Two DIFFERENT situations.

You went from people are notorious for making bad financial decisions to "but people who buy Tesla's are not those people"? Is that what you were saying?