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

[Artful Dodger]

With 87 working days at the Fremont factory this Quarter, today's mid-day shift change represents the HALF-WAY POINT in Tesla's 2020Q1.

GO TESLA!

Cheers to the Longs!

 

[pz1975]

What happened to the cardboard option? I thought that the trees were planted for a cardboard factory.

Not sure a cardboard factory would last very long as soon as it started raining.

 

[JRP3]

Der IKEA-Wald is disappearing quickly.

Emil Senkel on Twitter

Daniel Kumm on Twitter

Giga Berlin / Gigafactory 4 on Twitter

Power is en route (unlikely the primary connection at this point):

Emil Senkel on Twitter

Conduits snake throughout the plantation.

Giga Berlin / Gigafactory 4 on Twitter

Branches are going into a chipper. They seem to be hauling the chips off. They'll probably either be burned for power, or - preferably - used to produce particle board and the like.

Giga Berlin / Gigafactory 4 on Twitter

 

[Artful Dodger]

Who needs transmission lines when everything is distributed in Elon’s future energy world.

Gigafactories. And every other concentrated end-point consumer of renewables.

Tesla should consider making a lower range 280 mile S for livery use. By saving batteries they can make more, max out the line. The livery S would be about $5000 less or more. It would sell overseas well and with the efficiency gains might be able to be done with a 60 kWh battery. It’s all about maximizing profit as well as spreading sustainable transportation.

Lol. So a worse range than a Model 3 AWD LR for wot, $20K more?

 

[mblakele]

Could also be for paper or cardboard. In these sort of scots pine plantations in Germany, low-diameter trees (aka, these) are usually used for pulp wood and chips; older, higher diameter trees are used for structural timber. Lots of different things you can make from pulp and chips. But I don't have the background to know what they'll use to decide which feedstocks will get allocated to what; there's probably people here with a more appropriate background.

A lot of waste wood products are also just outright burned (biomass power makes up about 4% of the German grid).

Wood burning for power isn't by any stretch "clean", but at least it's renewable, and low net carbon.

(I've also noticed in some of the above pictures that the trees appear to have been previously tapped for resin... but I'm not positive that those shots are actually on the property)

FWIW I'd say it'll be burned for thermal power, because the wood-chipper bin had "DONNER: Energie aus Holz" on its side. There was also a van or three with the same livery, in an earlier photo, and their web site emphasizes "Energieholz".

Donner GmbH: Forstarbeiten, Energieholz & Trassen- / Baumpflege in Bronkow - Brandenburg

I'd think they'd only burn the chipped-up branches etc. The timber is probably worth more as pulp and chips.

 

[Rashomon]

Because gigafactories.

Can’t scale batteries at max level being separate. The energy side fuels battery investment, which benefits the auto side and vice versa, it’s a positive cycle from both sides on each other.

Solar+storage will soon be married at the hip going forward with battery costs go down which lifts solar value proposition with it. More solar innovation and production. Another virtuous cycle of increasing battery investment.

The marriage of tech can’t scale or develop efficiently separate, especially when your stated mission is about accelerating things. This is another reason they pulled in Solarcity, since there were many regulatory road blocks to working together separately as public companies.

If both solar/energy and auto growth depend on battery production scaling, and Tesla is at the forefront of both energy and auto transition with its solar and auto tech, there is no advantage to spinning off which would become a headwind for the virtuous cycle which is a significant competitive advantage as well as accelerant in the transition.

I read from a power electronics analyst that the companies that made drivetrains for electric locomotives ended up controlling a lot of the mid-power electric-generation/control-electronics/etc. business, and that he expected the same thing in the sub-megaWatt space with Tesla and other emerging electric vehicle companies. The skills to make inverters and write sophisticated firmware translate from automotive to grid to solar power. There are also economies of scale: Tesla is currently the largest purchaser in the world of SiC power electronics, so much so that other companies are finding shortages, and the industry is scrambling to increase capacity.

Additionally it's clear that the both the EV space and the grid storage space are going to be dominated by whoever manages to be the low-cost battery producer, as battery cost dominates in both applications. I expect April will reveal Tesla's plan to scale battery production to allow aggressive growth in both businesses, and ensure that they remain the company with the lowest cost batteries into the foreseeable future -- which really is only 5 years or so.

 

[KarenRei]

FWIW I'd say it'll be burned for thermal power, because the wood-chipper bin had "DONNER: Energie aus Holz" on its side. There was also a van or three with the same livery, in an earlier photo, and their web site emphasizes "Energieholz".

Donner GmbH: Forstarbeiten, Energieholz & Trassen- / Baumpflege in Bronkow - Brandenburg

I'd think they'd only burn the chipped-up branches etc. The lumber is probably worth more in other applications: cardboard etc.

Probably correct assumptions.

 

[⚡️ELECTROMAN⚡️]

Can I just say how much I love this forum and all the (non-ignored) people on it? Thanks so much, and of course I won’t be using any of your non-advice or blaming either of you if anything goes wrong while I am not applying any of your non-advice. This really [doesn't] helps and gives me a lot to [not] think and [not] spreadsheet about this weekend.

Cheers!

EDIT: And thank you too, steak&chicken! These are some nice problems to have.

I would respond with something witty, but you would probably be unable to see it.

 

[wheelwhright]

I am so mad. It seems another court ordered to stop the woodcutting work at Giga Berlin just today. I can't believe the "green" league of Brandenburg is standing in the way of the clean energy transition. It's unbelievable. It is stopped until there is a new hearing on the failed emergency appeals (from Friday) of said green league...

in German:
Tesla: FDP warnt vor Klagewelle gegen Gigafactory in Brandenburg

At least from the article it's clear that politicians are aware that the dealing of said green league is myopic. Hoping they are gonna make clearing this the top priority for the week.

 

[Foghat]

Blast from the past, maybe some analysts will start paying attention 7 years later.

What are the cost savings to a produce/manage Tesla kwh power offerings when they can recycle energy storage? New auto sales with 100% recycled batteries? Robotaxi costs?

“We are still thinking deeply about recycling.”
-JB Straubel 2013

 

[kcveins]

feeling the same way with My MS 2017 ... must resist the temptation
much better to buy shares with the upgrade $$$ in a few years you can buy the Roadster

not advice

I have a 2013 S without all the bells and whistles and told myself that I had to keep this for more than 175K miles before upgrading.. have 35K more to go
Getting harder....
I MUST RESIST....

 

[kishdude]

Questions about Q1 deliveries and why I feel they may be lower than expected.

I have a feeling that TSLA may report lower than expected Q1 car deliveries. First I don't know what the "expected number" is, but given that Elon has stated that their goal is well over 500K deliveries for this year, then I suspect that a number significantly below 100K for the quarter may be perceived as a miss. Here are my reasons:

1) Model Y ramp. Is TSLA building a whole new production line in Fremont for the Model Y or are they using an existing M3 line for this? I suspect they are using an existing M3 line and if that is the case, there will be less M3s built as they ramp Model Y and therefore less Model 3s delivered. They will not begin delivering Model Ys until March and these will not significantly show up in Q1.

2) No prebuilt inventory at the end of Q4. TSLA delivered more cars than they produced in Q4 which means that they do not have much inventory to deliver. This combined with reduced M3 production due to #1 above means that they will deliver less cars in Q1.

3) China corona virus. Yes, I know that the shutdown in China was only for 1 week, but I don't see too many customers out "car shopping" during this outbreak.

These are my reasons why deliveries in Q1 may be low, but I want to know from the community what they feel the expected deliveries will be. After all, a miss only happens when expectations are not met.

 

[abasile]

Related to KarenRei's strategies about selling on the way up and buying on the way down, I'd like to do that with a sold put. I've sold puts before when the stock price was lower. I've got about $30k, which worked to sell 1 put when the stock was $300....I can't do that now, I can't cover the cost of a $600 put if exercised.

I'm not aware of any brokerages supporting fractional options.

A very conservative approach (this is not advice) could be to sell a Put with a $300 strike price and some time value. For instance, if you were to sell a Sep. 2020 $300 Put, the option premium would be around $5.50/share. Assuming the position is held to expiry and doesn't get exercised (i.e., TSLA doesn't go below $300), using your $30k cash to secure that Put would yield roughly the same return as a bank CD paying a little over 3% annual interest (which doesn't exist today). However, if the TSLA price spikes up and/or IV goes down, then you could potentially buy back that Put much sooner than September for a faster profit.

We already have plenty of TSLA shares relative to the size of our portfolio, so for a while I've been supplementing our TSLA position with sales of TSLA Puts that are deep out of the money. I just sold a Put yesterday with a strike price of $450. Recently, I've also been dabbling in bull Call spreads, roughly along the lines of @KarenRei's approach but on a smaller scale.

If our existing TSLA position were small or nonexistent, I personally would not hesitate to start buying a few shares at around $800. Again, not advice!

Probably isn't the right forum for this Q, but who do you call when you need to make a claim?

They provide a contact number for both policy changes and claims. Knock on wood, I have never had to make a claim on my auto policy and I sure as hell hope that trend doesn't break any time soon.

In December, we had to make a glass claim on our Tesla policy, for the windshield. They were responsive and easy to work with. However, we had to pay cash to a Tesla service center to do the replacement (could have chosen SafeLite but wanted to use Tesla) and then get reimbursed by Tesla Insurance!

I hope my model y order can come sooner than later, was in a car accident :/

I hope you were and others were not injured, and if you were, that you recover quickly!

I have a 2013 S without all the bells and whistles and told myself that I had to keep this for more than 175K miles before upgrading.. have 35K more to go
Getting harder....
I MUST RESIST....

Haha, our 2012 Model S now has 175K miles. Still a great car. My only complaint is that the regen on long mountain descents isn't as good as when the battery was newer, but we can usually mitigate that by charging to only 60-70% and pre-warming the battery pack. We don't intend to sell it, just keep it in the family.

 

[Tslynk67]

I’m in the same situation. My 2016 90D seems so old fashioned now. It is really itching to upgrade to the latest 100D. Not that I need the extra range.

Consider this - like many here, you're suddenly ITM, in a big way. You can afford a shiny new Tesla and in buying one, you'll be putting your 90D (old-fashioned to you, but State of the Art* to someone else) into the 2nd-hand market for someone less affluent than you to grab and get rid of their nasty ICE - likely their ICE isn't *that bad* which will then become a nice purchase for someone else who can then let go of an old clunker.

So it's not like you're being materialistic, you're initiating a hand-me-down chain that greens-up the global fleet.

* that's an Iain M. Banks reference, BTW

 

[MaChiMiB]

Questions about Q1 deliveries and why I feel they may be lower than expected.

I have a feeling that TSLA may report lower than expected Q1 car deliveries. First I don't know what the "expected number" is, but given that Elon has stated that their goal is well over 500K deliveries for this year, then I suspect that a number significantly below 100K for the quarter may be perceived as a miss. Here are my reasons:

1) Model Y ramp. Is TSLA building a whole new production line in Fremont for the Model Y or are they using an existing M3 line for this? I suspect they are using an existing M3 line and if that is the case, there will be less M3s built as they ramp Model Y and therefore less Model 3s delivered. They will not begin delivering Model Ys until March and these will not significantly show up in Q1.

Elons answer to that:

Martin Viecha -- Senior Director, Investor Relations

Okay. Thank you. The next question is, with respect to Model Y, what is your latest expectations for launch timing? Do you anticipate any Model 3 production downtime at Fremont during the launch? And how should Model Y gross margin percent look compared to Model 3 gross margin?

Elon R. Musk -- Founder, Chief Executive Officer & Director

Well, we've talked about the launch time. What really matters is the timing to volume production where volume production is some number in excess of 1,000 units per week. And we're confident of reaching that point no later than the middle of 2020. Yeah, so from an interest standpoint, we do not expect it to interfere. Yeah, the body line is separate, the paint line is -- basically we do not expect it to interfere with Model 3. No, we do not expect any downtime.

2) No prebuilt inventory at the end of Q4. TSLA delivered more cars than they produced in Q4 which means that they do not have much inventory to deliver. This combined with reduced M3 production due to #1 above means that they will deliver less cars in Q1.

First part is a valid point, but Tesla gets more experienced with logistics and thus can achieve near zero inventory at the end of the quarter (if the demand stays this high). So produced = delivered.

3) China corona virus. Yes, I know that the shutdown in China was only for 1 week, but I don't see too many customers out "car shopping" during this outbreak.

These are my reasons why deliveries in Q1 may be low, but I want to know from the community what they feel the expected deliveries will be. After all, a miss only happens when expectations are not met.

You really think that Teslas Chinese order book won't exceed Q1?

 

[lklundin]

I am so mad. It seems another court ordered to stop the woodcutting work at Giga Berlin just today. I can't believe the "green" league of Brandenburg is standing in the way of the clean energy transition. It's unbelievable. It is stopped until there is a new hearing on the failed emergency appeals (from Friday) of said green league...

in German:
Tesla: FDP warnt vor Klagewelle gegen Gigafactory in Brandenburg

At least from the article it's clear that politicians are aware that the dealing of said green league is myopic. Hoping they are gonna make clearing this the top priority for the week.

Same story, brought by another German media (incl. Google translate):
Giga Berlin / Gigafactory 4 on Twitter

 

[Tslynk67]

I’m in the same situation. My 2016 90D seems so old fashioned now. It is really itching to upgrade to the latest 100D. Not that I need the extra range.

Titanium though, can't get that no more, eh...?

 

[KarenRei]

Say Karen, your Tesla isn't on a ship that's being hammered by the twin bomb cyclones in the North Atlantic, is it?

Hope not. :Þ All I can say is, as of yesterday evening, it's not sitting outside at the port

1) Model Y ramp. Is TSLA building a whole new production line in Fremont for the Model Y or are they using an existing M3 line for this? I suspect they are using an existing M3 line and if that is the case...

That is not the case. The new Y line occupies the northwest side of the factory which formerly was used or service and warehousing (which has since been offloaded to Lathrop).

2) No prebuilt inventory at the end of Q4

Take the number of days you see as backlog as a result of this. Multiply that by the daily production rate. Adjust for any production rate growth at Fremont. Subtract your backlog change from what the quarterly production total would be if there was no inventory rebuild going on. Add Model Y to your total. Add Shanghai to your total (January production averaged 800/wk up to the holiday, rates should grow significantly over time, February has 3 weeks open with potentially some coronavirus-related hindrances, March should be a whole month with a great rate).

Calculate your sum.

3) China corona virus. Yes, I know that the shutdown in China was only for 1 week, but I don't see too many customers out "car shopping" during this outbreak.

China orders are backlogged by multiple quarters. Remember, the FUD a couple weeks ago was that a customer had asked Tesla whether his Model 3 which was supposed to be delivered in Q2 might get delayed to Q3, and Tesla couldn't promise him that it wouldn't.

 

[JBRR]

Colorado bill would allow direct EV sales

 

[Lessmog]

During a long, windy, rainy and cold weekend under the present persistent storms, may I present an alternative use for forestry and agri byproducts? Our Technology — Phoenix Biopower
They are not at full scale yet, so not an option for Brandenburg, but maybe some of the coming projects.

In an efficient process, biomatter is burned at high temp and steam pressure, driving a gas turbine generator (and heating the town from condensing the steam after, for re-use) and additionally allows for extraction of carbon from the exhaust to sequester into other uses of coal.

Beats me how it works exactly. But it looks tempting.