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

[Sean Wagner]

I couldn't say about Manager Magazin's history, but they are owned by the "Spiegel" group and the little details and SNAFUs reported that happen in every company set a negative tone. It would be easier than all get out to do the same to Tesla... don't we know that.

 

[avoigt]

I wish they'd stop putting PHEV's in with BEV's. PHEV's are NOT electric cars at all.

Fully agree. Its the auto industry try to confuse consumers who is leading in BEVs.

They look extremely weak if they just show how many true BEVs they have.

2018
BMW: 34,800
Tesla: 245,000

Still BMW claims to be the leaving EV company in Europe.

Thats ridiculous.

 

[humbaba]

Does Manager Magazin have a history of hit pieces?

If it's not typical then my guess is that the E-Tron is in even more trouble in reality: big delays, more cost overruns, or maybe even complete write down in favor of the VW I.D. platform?

These leaks are part of a carefully orchestrated camping by VW too management to break the bad news, piece by piece.

Last year when there was talk of the e-tron I remember cautioning against its eventual production on the basis that the first production dates were stated as being contingent on demand and Audi was clearly not trying to sell the car (only through dealerships which have incentive to sell you something else). This article seems to make clear that there is insufficient demand -- I'm not surprised.

Once you add in the internal knowledge about cost overruns, missing the Tesla target and the externally knowable things like lack of efficiency and range -- the e-tron ends up about where the naysayers always said.

This is not good news. This is not accelerating the transition to EV. Even as fast as Tesla is ramping up it just isn't enough. And, apparently to bow to the gods of profit and positive cash flow, Tesla has stopped ramping as fast as possible. Other manufacturers need to take up the slack. I like the idea of Rivian, but a startup getting into full production profitably is more than a bit of a gamble -- and they lack the capital to produce at scale even more than Tesla.

In short, what is needed is for an incumbent manufacturer to really bite the bullet and seriously produce an EV. When I say serious, I don't mean at Bolt or Leaf levels -- which are the best they've managed so far -- but at at least M3 levels. While doing so will not help their quarterly report or endear them to shareholders, it is imperative for the greater good and their long term survival.

 

[avoigt]

Does Manager Magazin have a history of hit pieces? Isn't Volkswagen AG one of their biggest advertisers?

If it's not typical then my guess is that the E-Tron is in even more trouble in reality: big delays, more cost overruns, or maybe even complete write down in favor of the VW I.D. platform?

@KarenRei's estimates suggest very poor EPA range: which, combined with poor U.S. charging infrastructure and probable U.S. dealership sabotage would make it a very hard sell in the U.S. at its target premium price range.

These leaks could be part of a carefully orchestrated campaign by VW top management to break the bad news, piece by piece.

(The evident pro-E-Tron trolling here on TMC would support the notion of such a campaign as well.)

Manager Magazin has a very long history of Tesla hit pieces and they still continue.

However with the more obvious news that the German automakers fall short in expectations and I agree that the e-Tron will not cut it although will be sold, Manager Magazin will write about that shortfall more often.

Thats good reporting because just the truth on the other hand its now all in Teslas hands again to get consumer BEV adoption.

Good for us investors but not necessarily good for the mission.

 

[Sean Wagner]

Careful about the distinction between the e-tron which is an irrelevant short-term band-aid and "the coming" models based on the PPE ("Premium Platform Electric").

Quote from the article:

Die Elektroallianz mit Porsche – man entwickelt einen gemeinsamen Baukasten – hat einen kompletten Neustart hinter sich. Der Start mit Porsches SUV Macan und Audis EQ6 wird sich um etwa ein halbes Jahr auf Frühjahr 2022 verschieben. Die Porsche- und Audi-Ingenieure müssen nachrüsten, weil Teslas Model 3 besser geworden ist, als sie dachten.

Rund 3000 Euro über den kalkulierten Kosten pro Auto liege das erste Modell des Baukastens PPE ("Premium Platform Electric"), berichten Ingenieure; dementsprechend weit entfernt sei es von den angestrebten 8 Prozent Umsatzrendite. Und ausgerechnet beim mit Abstand mächtigsten Kostenblock könne man nicht mehr sparen: den Batteriezellen.

End quote. Translation:

The EV alliance with Porsche - they are developing a common platform - has undergone a complete reset. [When? Initiated by whom?] The debut of Porsche's SUV Macan and Audi's EQ6 will be delayed by half a year to early 2022. The Audi and Porsche engineers have to find improvements because the Tesla Model 3 came out better than they thought.

The first model built on the PPE platform will come in roughly 3000 Euros over the calculated costs per car ... hence a big delta to the aim of generating 8% returns. And the biggest cost factor - the battery cells - aren't available for further reductions.

 

[Tslynk67]

Right now they obviously don't want to Osborne Effect themselves, that's why they are mum about HW3, even if it's already in EU/China models.

Even in early April they might not want to go full horn-blowing - only once the first FSD features like stop signs, traffic lights and left/right turns are released. Then I'd expect full horn blowing, coast-to-coast FSD trip and the whole nine yards.

Because that's when HW3 will start generating more sales and more revenue for real.

True for my personal n=1, the moment we begin to see FSD in Europe then I'm ponying-up for it, right now just have EAP.

 

[AndyH]

I wish they'd stop putting PHEV's in with BEV's. PHEV's are NOT electric cars at all.

Yes, they're just completely unnecessary but they are also the gateway drug for many. Most people owning a PHEV will soon want to switch to a BEV. Good for Tesla.

 

[Buckminster]

Still BMW claims to be the leaving EV company in Europe.

I suspect you meant to write "leading". However, leaving is more appropriate...

 

[lklundin]

If it's not typical then my guess is that the E-Tron is in even more trouble in reality: big delays, more cost overruns, or maybe even complete write down in favor of the VW I.D. platform?

@KarenRei's estimates suggest very poor EPA range: which, combined with poor U.S. charging infrastructure and probable U.S. dealership sabotage would make it a very hard sell in the U.S. at its target premium price range.

Excellent point about the US dealerships, who are expecting US dealers to sell a vehicle with substantially less maintenance?
Also, as a foreign car maker (with an engineer serving 7 years in a US prison), they are unlikely to be able to influence the dealership legislation in their favour.

 

[humbaba]

True for my personal n=1, the moment we begin to see FSD in Europe then I'm ponying-up for it, right now just have EAP.

I was just thinking: if Tesla put HW3 in cars before the announcement they could then offer -- at original purchase price, not after purchase add on -- the FSD option along with the announcement of FSD features.

This would not only avoid osbourning sales, but avoid purchaser remorse for those that bought before the announcement -- its win-win. If this was restricted to those that purchased EAP it would not increase Tesla's costs as it is supposed to have the hardware in any case. But it would also be possible for all vehicles as long as the per-unit cost was low enough.

IMO there would be high uptake among owners of EAP vehicles with experience driving a Tesla. Allowing purchase (for a limited time) at original purchase price would increase uptake. From a normal corporate perspective increasing uptake only helps if the profit increases despite a price break, but given Tesla's mission and intentions with regards to FSD I think it would make sense regardless.

 

[Fact Checking]

This is not good news. This is not accelerating the transition to EV. Even as fast as Tesla is ramping up it just isn't enough. And, apparently to bow to the gods of profit and positive cash flow, Tesla has stopped ramping as fast as possible.

Tesla is ramping up as fast as possible: they are at 6k-7k/week now, and the remaining 3k/week capex was redirected to the Shanghai Gigafactory. That's the original 10k/week target, hiding in plain sight.

This wasn't the result of Tesla bowing to cash flow, it was the result of Trump starting a tariff war with China, which removed 3k/week demand and supply from Fremont.

Tesla's focus on cash flow is going to further accelerate the EV conversion: it's a much faster and more reliable source of capex than a $3b dilutive equity financing round which would drop the $TSLA price by 20% ...

Tesla needs a bit of time to build the new factories and to reduce the entry price in every major market, to broaden the addressable market to 1+ million units per year.

Patience!

 

[Tslynk67]

All this needless chatter from the FUDsters about Tesla M3 discount of $1100.

Yet almost weekly in paid advertising mail from ICE OEM Dealers, I receive these. This weeks' flyer: 5% OFF MSRP, 10% OFF MSRP, 15% off MSRP, on their new 2019 models. No figure.
View attachment 375927

Careful, it's not a discount of $1100, it's a cost reduction. More to follow, all way to $35k

 

[humbaba]

Tesla is ramping up as fast as possible: they are at 6k-7k/week now, and the remaining 3k/week capex was redirected to the Shanghai Gigafactory. That's the original 10k/week target in plain sight.

This wasn't the result of Tesla bowing to cash flow, it was the result of Trump starting a tariff war with China, which removed 3k/week demand and supply from Fremont.

Tesla's focus on cash flow is going to further accelerate the EV conversion: it's a much faster and more rekiable source of capex than a $3b dilutive equity financing round which would drop the $TSLA price by 20% ...

Tesla needs a bit of time to build the new factories and to reduce the entry price in every major market, to broaden the addressable market to 1+ million units per year.

Fair enough, but do you really think that Tesla is producing enough to replace ICE? By what year? What needs to happen is someone with deep resources (not a startup) to take EV adoption seriously. If its just Tesla then all of the conservative legacy maker predictions about how long it will take for the EV transition will come true. This is not good for the mission: Tesla is supposed to accelerate the transition, not be the only one doing it.

 

[Buckminster]

Fair enough, but do you really think that Tesla is producing enough to replace ICE? By what year? What needs to happen is someone with deep resources (not a startup) to take EV adoption seriously. If its just Tesla then all of the conservative legacy maker predictions about how long it will take for the EV transition will come true. This is not good for the mission: Tesla is supposed to accelerate the transition, not be the only one doing it.

I have previously suggested that Tesla are TOO GOOD and that this is causing the ramp by other manufacturers to reduce as they are constantly on the back foot. The net affect is that the acceleration is less than it would have been if Tesla were just 200% better than the competition. At the moment, Tesla are off the charts. Better than Apple versus the rest in the early days. I know that this does not go down here well but this is the third time I am saying it and glad I'm not the only one.
Of course, as a Tesla investor, I couldn't be happier. I just want to make the point so that we are all talking the truth and not just fanboys. Of course, the opposite is also true. Without Tesla, nobody else would have anything to accelerate. There are plenty of niches that Tesla aren't talking about yet - the others need to find them and carve out a piece of the market before it is too late. Swallowing their pride is step 1. For instance, do BMW want to lose their street cred by developing a bus? Probably not, but it is an option for them that is going to work better for them than going head to head against Tesla. Small cars like the Mini is the most obvious of course.

 

[Artful Dodger]

And, apparently to bow to the gods of profit and positive cash flow, Tesla has stopped ramping as fast as possible.

No. Elon has realized (through experience) that it is not possible to ramp production without being profitable and cash flow positive. That's all part of sustainability.

The EV transition is a marathon, not a sprint. Tesla has hit its stride now, and is executing beautifully. When GF3/Shanghai is in production in about a year, total Model 3 production worldwide will be nearly double the 2018H2 rate.

You know, the year Tesla became profitable? Don't worry, it'll be alright.

Cheers!

 

[Fact Checking]

Fair enough, but do you really think that Tesla is producing enough to replace ICE? By what year? What needs to happen is someone with deep resources (not a startup) to take EV adoption seriously. If its just Tesla then all of the conservative legacy maker predictions about how long it will take for the EV transition will come true. This is not good for the mission: Tesla is supposed to accelerate the transition, not be the only one doing it.

Firstly, I'm not certain legacy OEMs can mass manufacture EVs, exactly because they have their fragile ICE legacy business hanging around their necks like an albatross. The E-Tron failure just makes this really apparent, through an actual example.

Secondly, I think you are underestimating exponential growth. Elon is clearly focused on maximizing the exponent of the forcing function of EV growth, which is cash flow.

The rest is the strongest force in the Universe.

 

[Unpilot]

Firstly, I'm not certain legacy OEMs can mass manufacture EVs, exactly because they have their fragile ICE legacy business hanging around their necks like an albatross. The E-Tron failure just makes this really apparent, through an actual example.

Secondly, I think you are underestimating exponential growth. Elon is clearly focused on maximizing the exponent of the forcing function of EV growth, which is cash flow.

The rest is the strongest force in the Universe.

Money?

 

[Artful Dodger]

Money?

Albert Einstein is said to have called "the power of compound interest the most powerful force in the universe."Jun 7, 2011
Compound Interest - The Most Powerful Force in the Universe?

 

[Navin]

Reading this article in elektrek and seeing some of the comments made by many of the usual FUD Troll mafia that I assumed were just short the TSLA stock - it dawned on me that perhaps these folks are are actually being supported by big auto. If traditonal OEMs cannot compete with Tesla or at least need some runway to get there - why not pay a few folks to do whatever they possibly can to drag Tesla and Elon musk in the mud.

 

[dc_h]

The article you relied on was only about the Las Vegas delivery hub where there were 150 jobs cut, related to Model 3 delivery logistics: it's probably the NA central hub most affected by delivery related job cuts, which allowed you to peddle the 'two thirds of domestic Model 3 delivery staff' lie and false narrative.

The arguments I made apply more broadly to the global picture: probably more non-NA hiring now that global deliveries are increasing, and job cuts in parts of the North American logistics chain that either became superfluous due to more direct deliveries (Tesla bought trucking companies to ship faster and more direct) or became over-sized.

Again this helps Tesla become more efficient and earn a billion dollars of cash every single quarter, again and again.

They’re also doing more deliveries at GF1. So maybe both expected reduced deliveries following Q4 rush and more focus in Sparks.