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

[KSilver2000]

Tesla rarely acquire companies. I bet they are very happy to be able to complete the Maxwell deal. It should help to reduce cost and make batteries better.

I think everyone here knows that at the very least.

 

[svp6]

Why don't you sell your TSLA shares and buy a company that needs to advertise? Because Tesla doesn't. The product is that good. Tesla advertising would be the same as flushing money down the toilet. They already sell all the cars they can make and they are making them as fast as they can.

For those who read Tesla forum the product is that good. For those who do not Tesla it is not even on the radar screen. Your word of mouth and mine against the endless media bombardment is not worth that much - and you have the SP to show it. Once EVs are 20% of the market, there will be more visibility. To date this is more like 2-3%. My colleagues look at everything else but Tesla, despite my best effort to educate them. And those few that were slowly seeing the light now don't want to hear about it because of the impending bankwupcy they keep reading about.

It is true that having another few hundred thousand more people interested in the car will not sell more cars than Tesla can actually produce - but it will certainly improve the mix and profit margin. Having gone through 3 Tesla's, I remember people here moaning why performance version were given priority and they had to wait, while investors were rejoicing. As an investor, I would feel much more comfortable seeing on Tesla order page that delivery of SR+ will take couple of months and that of P3D+ couple weeks.

I do not necessarily think Tesla should do commercials. But perhaps Tesla could think out of the box and come up with a more creative way of combating FUD. As I said, whatever they have now is not nearly enough.

It is OK to believe in a company and be critical at the same time, you know? And even the most intelligent people can be wrong, including Elon.

 

[Menifeer]

As for advertising......why? We're cell constrained and demand is not an issue. Elon is against advertising on principle. You guys are buying into the horseshit, yet think more advertising is the solution? Banish it to irrelevance and help society evolve!

Increased demand will allow higher margins on cars sold, either through raising prices or selling more fully-equipped cars. The improved financials will help counteract the FUDster arguments, raise the share price and make future cash-raising options more palatable to investors.

It's not horseshit just because Elon doesn't understand the benefits. What's not to like?

 

[Krugerrand]

he did say there would be battery investor day. when is that though?

Later this year. No. They did not give a date.

 

[Todd Burch]

Okay here are my concerns so we are not out of the woods yet.

1. Elon pretty much guided for cash flow positive vs GAAP+ from this point forward
2. Currently FSD does not seem as advanced as the video made out to be. Elon said "releasing the dev version out to the public will be a really bad idea". His tone make it sound like current FSD software will have a high chance of killing you.
3. Tesla is now cell limited and it's hindering their growth. They have solutions in line such as the Maxwell acquisition, but raw material limitation may be next and Tesla has no solution for that except "go in the business of mining".

I wouldn't be celebrating yet, the sentiment is positive but there are plenty of ammo for bears to attack this company.

My rebuttals:

1. So how did that approach work out for Amazon?

2. Not really news. We all know that.

3. Maxwell IP leads to higher energy density, so less raw materials needed per car. But anyway, “our stuff is in such high demand we can’t find enough of it” isn’t exactly a negative...

 

[powertoold]

True but Elon has said they would rather sell the SR+ since they can make more of them. They are cell supply limited.

No ads needed

 

[StarFoxisDown!]

My biggest takeaway is that Tesla and Elon finally learned how to temper expectations while creating excitement for future products.

Elon officially stated Model Y is on track to launch in Fall 2020......but stated internally they have more ambitious goals for its release date.

He repeated this language multiple times when talking about other products.

I feel that a lot of the negatives people listed from the event such as lack of clarity about GAAP profitability is just Elon making a conscious decision to temper expectations.

 

[lascavarian]

Along these lines what if Tesla could have continued to sell high margin variants of Model 3 into Q1 and Q2 without having to rush the release of the 35k Model 3? How much would that have been worth to the company?

We need a lot of great EVs. If you want to play that game then you likely lose me as a customer. Price has to come down, volume go up. Don't wait, build build build. Increase reliability, improve safety, improve efficiency, cut prices, extend disruption, repeat.

Once a million or so vehicles are built then find a way to keep them as fully utilized as possible through a ride sharing network. Make every Tesla take 3 ICE vehicles off the road. At least that is how EM seems to be going and I really like it. Just my view...

 

[TMThree]

Is there anyone at Tesla willing to sit down and educate Elon on advertising? This seems like another topic that Elon doesn’t know much about and would do well to understand why advertising is so, so effective for the mostly part.

I can only hope you apply at Tesla and inform Elon how to run his company. I'm certain you have a resume that can back up your rather large mouth, right?

 

[trentbridge]

You really don't want Tesla thumping its chest about Maxwell... even IF it was a bank robbery. Reason being, it will make the next battery tech acquisition that Tesla does a lot harder.

Logically they would license Panasonic to make the Maxwell Tech battery cells at GF1. Panasonic is running at full speed to supply battery cells for the Model 3 and I don't see Tesla wanting to get into the battery cell production business at the same location. Panasonic knows the machinery and the techniques to get millions of battery cells with good quality control. Given that Tesla needs about 400,000 battery cells a day, it would be impossible to switch the Model 3 to Maxwell DBE cells without massive disruption. Therefore the limited production of Maxwell batteries would be used for a Model S/X battery pack sourced from GF1 and not Japan. This would allow GF1 to ramp up the volume of Maxwell cells produced before launching a refreshed "extended LR" version of either the Model S or model X.

 

[neroden]

Since Model 3 production capacity will rise from 6k a week to 10k+ a week next year, they might actually start to deliver in India. This is different from technical issues. It's a business decision. If demand from China is super strong, then they might delay India delivery to 2021.

Does anyone seriously think demand in China (and nearby locations) is going to be weak? Musk also referred to the substantial bureaucratic red tape in India, and that may delay things a lot.

 

[Carl Raymond]

Was surprised to hear Elon say Battery Tech Day will be towards the end of the summer and not end of 2019. Seems to me they're lining it up with the announcement of Pickup and S/X full refresh(if employee leaks are real at all).

Or are they timing the announcement of dry battery electrodes so as to announce it post fact. As in “Welcome to battery investor day, as of last week, all Tesla cars delivered contain eco-cells, free of solvent.” Play down performance gain. Play up the productivity gains.

It would explain why no new sods have been turned at GF1. It also explains the dark ‘capacity’, if conversion to DBE hampers productivity during preparation. It also fits with “cat in the bag”. This is a significant cat.

Krugerrand’s post above about how Tesla are usually further advanced than we give credit for, is also what I have observed.

Basically, if it’s been posted here, Tesla have already analysed the heck out of it, including the pros and cons of advertising and pricing strategies.

 

[MartinAustin]

some small targeted marketing would go a long way.

Elon said earlier, in fact, he laughed, that there is no demand problem. What would any kind of advertising or marketing do? Increase demand, when there is enough already to satisfy production capabilities.

Perhaps in the future when they have so much manufacturing capacity that they are running out of new orders to fill...

But when will that ever happen? Some time after Model Y? Point being... sure, advertising will be necessary at some point, but not for a long time.

 

[Krugerrand]

For those who read Tesla forum the product is that good. For those who do not Tesla it is not even on the radar screen. Your word of mouth and mine against the endless media bombardment is not worth that much - and you have the SP to show it.

You’re wrong. *We* in fact have a lot of power. As an example; *We* (as in a handful of Tesla Model S owners) shamed the powerful NYT and they’ve yet to forgive us for it.

Word of mouth is exactly how Tesla went from selling a handful of cars to tens of thousands to hundreds of thousands. All fully electric, that the media said was vaporware and would be nothing more than glorified golf carts.

One man, Elon Musk, has over 20M followers on Twitter. That’s power to influence.

The SP is something *we* don’t have control over at this time. That control belongs to a rather small group of thieves, crooks and bandits. Yes, a quite small group of people. Yet another example that individuals do in fact have power and if a few band together that power grows.

Stop bickering about it and go do something.

 

[Mike Smith]

"We need a large scale solution to cell production" -JB

"We're not sitting idly by, we're taking all the moves required to be masters of our own destiny here, uh, technologically and otherwise and I think, you know, through all the experience we've developed with partners and otherwise, we have solutions in place" -Drew


We now know for sure they're making their own cell production lines.

 

[Krugerrand]

A very simple FAQ page would solve a lot of problems...I could write the damn thing.

Then prove it. Write it and send it to Tesla.

 

[CatB]

It’s not stupid to have a moral and ethical compass, unless you’re someone who doesn’t have one to begin with. Then you’d think it was stupid.

His philosophical opposition is entirely valid and it’s his ethical and moral philosophies that caused Tesla cars to have the lowest probability of injuries, and caused Tesla to be proactive and overly cautious concerning recalls, and caused a several month delay for new S owners when the original new seats weren’t 5* rated, and it caused Tesla to remain a public company last year, and on the list goes.

This. When I heard Elon doesn’t believe in advertising because it’s deceptive, I inwardly cheered.
Advertising provides: No. Net. Economic. Value.
Advertising is a net-zero game: company A misleads you into thinking their products are better than company B. So A profits at B’s loss. Oh, and the misled consumer loses too. Tesla’s mission is to move the world to sustainable transportation. They are providing a better product that doesn’t destroy the planet. ICE manufacturers reap profits and the earth suffers the consequences of all that pollution. It’s the ultimate tragedy of the commons and Elon and Tesla are not stooping to that level of greed.

 

[neroden]

Is that Tesla's fault? Damn, hard to have your cake and eat it too. At least you'll know they're working towards it.

In North Dakota, the evidence is that Tesla sat on the permits, so yes it is Tesla's fault. There has been speculation as to why. There's a fairly short construction season. They were conserving cash two construction seasons ago, and then again early last construction season, and then rumors of Supercharger v3 came out so they may have decided to put it off until v3 was ready... but the result is that the permits, while better than nothing, are no indicator of when the stations will open. They still haven't broken ground at ANY of the North Dakota sites and I am frankly not expecting them this year at ALL. Hopefully next year they'll really build them.

 

[neroden]

I think it is interesting that no one is mentioning that Elon said that they have to complete another acquisition, and write some software, to get Tesla insurance up and running. What insurance related company are they going to be buying?

I think this was just too mystifying. I assume the software is going to feed Autopilot usage / safety data to the insurance rating system. But I have no idea what company they'd be buying. They can't afford to buy a full-fledged insurance company (those things are expensive).

 

[RobStark]

It's a little ridiculous to pick on Tesla over leather steering wheels when there are much bigger fish to fry! I thought Elon handled her questions well. If you want to be an environmental Puritan, there's always plenty to pick on, like why it's taking so long to put more solar panels on GF1, why GF3 will be using natural gas, etc. It's important instead to focus on the big picture.

No, there are bigger BEYOND Burgers to fry!