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

[jerry33]

For some areas it might even become clear that the shutdown saved more lives by stopping emission than by stopping the virus.

I think a lot of votors, a lot of politician, a lot of good people and a lot of virtue signallers will be looking at reducing pollution. And what is the best way to do this? Electric vehicles and solar.

"a lot of politician, a lot of good people". These are polar opposites. I expect the politicians to embrace big oil and the dealership associations the way they have always done because they only care about their wallets. I'd love to be proven wrong, but chances are very slim. This goes for both sides of the aisle with a very few exceptions.

 

[j6Lpi429@3j]

"a lot of politician, a lot of good people". These are polar opposites. I expect the politicians to embrace big oil and the dealership associations the way they have always done because they only care about their wallets. I'd love to be proven wrong, but chances are very slim. This goes for both sides of the aisle with a very few exceptions.

Thats the US, but tesla sells all; over the world. Europe definitely is moving (not fast enough but still...) towards widespread support for EVs and the eventual banning of ICE sales. We already have dates set by many European countries for when only EVs can legally be sold.
And The big car companies are global anyway. They aren't going to keep some little retro niche gasoline-car project running purely to sell to the US, when everybody else wants EVs.
Even if Trump actually OUTLAWED the sale of EVs in the USA, it would only be a speed bump in their global adoption. The momentum is clear.
In the UK our transport minister (grant shapps) drives a model 3

 

[StealthP3D]

"a lot of politician, a lot of good people". These are polar opposites. I expect the politicians to embrace big oil and the dealership associations the way they have always done because they only care about their wallets. I'd love to be proven wrong, but chances are very slim. This goes for both sides of the aisle with a very few exceptions.

Well, that depends on who we elect, doesn't it? We, the people, deserve exactly who we collectively choose. This constant whinging about how both sides are corrupt is silly and ridiculous to the extreme. We, the people, elected the ones that appointed judges who gave the corporations unlimited voice, and we, the people, elected the ones who allowed money to corrupt our politics and decimated our public educational system.

It's about time that we, the people, take responsibility for our actions rather than blaming the people who we elect. Are we complete idiots? Look at who we elect before you answer that!

 

[junas]

Thats the US, but tesla sells all; over the world. Europe definitely is moving (not fast enough but still...) towards widespread support for EVs and the eventual banning of ICE sales. We already have dates set by many European countries for when only EVs can legally be sold.
And The big car companies are global anyway. They aren't going to keep some little retro niche gasoline-car project running purely to sell to the US, when everybody else wants EVs.
Even if Trump actually OUTLAWED the sale of EVs in the USA, it would only be a speed bump in their global adoption. The momentum is clear.
In the UK our transport minister (grant shapps) drives a model 3

Momentum is clear in Europe and EV support is definitely there. The only remaining bottleneck of wider adoption is still the price. Despite its clear success Model 3 is over $30K more expensive than average car sold in Europe. During H1/2019 avg car retail price in Europe was $34,091 (whereas Model 3 EU avg price was $67,440). Even Renault Zoe EV having $35,036 EU avg retail price is more expensive than avg car sold. Total cost of ownership helps EVs by additional $5000-10000, but there is still huge difference. We need at least 25% further price reductions industry-wide to push all ICE sales off the cliff in Europe.

The best part: Tesla is selling well even Model 3 currently costs double the avg EU car price. Total addressable market increases significantly once Giga Berlin gets running making price reductions possible without losing margins. This should be very similar to what is happening in China right now. Berlin production saves Tesla at least 10% on import tariffs. I could imagine reduced transport costs and improved automation could help another 5%. Things are looking promising in Europe, but we are still a couple of years away from the real tsunami.

Source of the above mentioned prices: Jato dynamics research.

 

[UCF3]

Well, that depends on who we elect, doesn't it? We, the people, deserve exactly who we collectively choose. This constant whinging about how both sides are corrupt is silly and ridiculous to the extreme. We, the people, elected the ones that appointed judges who gave the corporations unlimited voice, and we, the people, elected the ones who allowed money to corrupt our politics and decimated our public educational system.

It's about time that we, the people, take responsibility for our actions rather than blaming the people who we elect. Are we complete idiots? Look at who we elect before you answer that!

This rant is OT. Please moderate yourself

 

[jerry33]

Thats the US, but tesla sells all; over the world. Europe definitely is moving (not fast enough but still...) towards widespread support for EVs and the eventual banning of ICE sales. We already have dates set by many European countries for when only EVs can legally be sold.
And The big car companies are global anyway. They aren't going to keep some little retro niche gasoline-car project running purely to sell to the US, when everybody else wants EVs.
Even if Trump actually OUTLAWED the sale of EVs in the USA, it would only be a speed bump in their global adoption. The momentum is clear.
In the UK our transport minister (grant shapps) drives a model 3

Agreed. I was only referring to the U.S. Europe appears to be more sensible. My bad for not making that clear.

 

[gerebgraus]

Momentum is clear in Europe and EV support is definitely there. The only remaining bottleneck of wider adoption is still the price. Despite its clear success Model 3 is over $30K more expensive than average car sold in Europe. During H1/2019 avg car retail price in Europe was $34,091 (whereas Model 3 EU avg price was $67,440). Even Renault Zoe EV having $35,036 EU avg retail price is more expensive than avg car sold. Total cost of ownership helps EVs by additional $5000-10000, but there is still huge difference. We need at least 25% further price reductions industry-wide to push all ICE sales off the cliff in Europe.

The best part: Tesla is selling well even Model 3 currently costs double the avg EU car price. Total addressable market increases significantly once Giga Berlin gets running making price reductions possible without losing margins. This should be very similar to what is happening in China right now. Berlin production saves Tesla at least 10% on import tariffs. I could imagine reduced transport costs and improved automation could help another 5%. Things are looking promising in Europe, but we are still a couple of years away from the real tsunami.

Source of the above mentioned prices: Jato dynamics research.

Tesla has achieved historically over 10% /year cost reductions from factors others that you mentioned. This might not be obvious from the prices. They simply Their efficiency improves all the time in every part. The most important part is the cost of the battery that also have the 10% yearly improvement. Becasue of the current high cost of batteries, Tesla is limited to compete in the premium car segment. In about 3 years with cheaper, lighter and even more durable batteries and alien dreadnought manufacturing Tesla will be ready to compete at every segment including econoboxes.

 

[JRP3]

Are we complete idiots?

Apparently enough of us are.

 

[Sudre]

Momentum is clear in Europe and EV support is definitely there. The only remaining bottleneck of wider adoption is still the price. Despite its clear success Model 3 is over $30K more expensive than average car sold in Europe. .....

While I get the average price of a Model 3 is probably close to $60K, that is not something that can be compared to a $28K gas car. A $38K Model 3 would be a better comparison.... so not really $30K more expensive than the average.... otherwise cars would be selling at $8K in Europe... altho in that case there is the Renault Twizy hatchback.

It appears there are cheaper EVs in Europe but everyone wants the more prestige of a Tesla. You pay more for higher prestige items.

And yes your right.... once the factory gets built the cheaper version Tesla's will be more readily available IF demand does not force the price up to the higher trim cars. Not much Tesla can do about that. Other car makers should step up like VW. VW's prices are the ones that are too high. VW should be matching their gas car prices. Competition would drive down Tesla's prices if there was any.

 

[Christine69420]

On Friday Tesla increased the prices of all their cars for sale in Norway.

The most affordable Model 3 SR Plus is 12% up. Other models are up from 2.4% to 8%.

That does not sound like a car manufacturer with demand problems.

The Krone is down 16% compared to the Dollar since New Years Eve. So this is probably the reason why.

Source: Tesla øker prisene

 

[jbcarioca]

There's a simpler explanation: Private jets are FREE for businesses (or rather, 100% tax deductible at the expense of the public):

Private jets receive ludicrous tax breaks that hurt the environment | The Economist, March 2019

"Donald Trump's tax reform allowed individuals and companies to write off 100% of the cost of a new or used private jet against their federal taxes."​

I don't see the GOP handing out free EVs anytime in the near future.

They already are. The same 100% depreciation rule applies to effectively all business asset acquisition. It's not entirely that simple but my tax attorney thinks it will apply to all the assets I am thinking of acquiring this year. For those with large non-recurring gains in 202o this is truly incredible. This is horrible public policy but it is amazingly beneficial for me. Nobody seems to notice just how all inclusive that rule is. Any competent tax attorney can get almost anybody zeroed for US Federal tax this year.

 

[mongo]

They already are. The same 100% depreciation rule applies to effectively all business asset acquisition. It's not entirely that simple but my tax attorney thinks it will apply to all the assets I am thinking of acquiring this year. For those with large non-recurring gains in 202o this is truly incredible. This is horrible public policy but it is amazingly beneficial for me. Nobody seems to notice just how all inclusive that rule is. Any competent tax attorney can get almost anybody zeroed for US Federal tax this year.

Yar
Model X has been 100% deductible for businesses the first year for a few years now.
However,

I don't see the GOP handing out free EVs anytime in the near future.

is a bit inaccurate since it is a deduction against income, not a tax credit. So not free, but rather (1-taxRate) savings... At least until you sell the asset.

 

[PeterJA]

View attachment 531576
They must have a big rewrite coming this year. FSD functionality to this level would be insane.

The jeering at Elon in that Twitter thread reminds me of the jeering at Model S...
and Model X...
and Model 3...
and Model Y...
and Powerwall/Powerpack...
and Solar Roof...
and GF1...
and GF2...
and GF3...
and reusable rockets.
Market doesn’t justify reusable launchers, expendable rocket makers argue

The naysayers seem unable to learn from history.

 

[junas]

While I get the average price of a Model 3 is probably close to $60K, that is not something that can be compared to a $28K gas car. A $38K Model 3 would be a better comparison.... so not really $30K more expensive than the average.... otherwise cars would be selling at $8K in Europe... altho in that case there is the Renault Twizy hatchback.

It appears there are cheaper EVs in Europe but everyone wants the more prestige of a Tesla. You pay more for higher prestige items.

And yes your right.... once the factory gets built the cheaper version Tesla's will be more readily available IF demand does not force the price up to the higher trim cars. Not much Tesla can do about that. Other car makers should step up like VW. VW's prices are the ones that are too high. VW should be matching their gas car prices. Competition would drive down Tesla's prices if there was any.

The starting price of Model 3 is roughly $55K in most EU countries (not ~$38K like in the US). That $55K is for SR+. The comparison to avg gas car price makes sense to point out that EV prices need to go down to replace all ICEs on the road. We all know it's happening sooner or later, but currently majority of Europeans cannot afford to buy a Tesla (or even cheaper EV). However, it's totally fine that SR+ version is $21K more expensive than avg car since Tesla is supply constrained. When supply issues are gone we'll see if Tesla prefers maximum profit margins or aggressively increasing market share. I doubt they can sell unlimited number of cars at $55K in Europe. More than happy to be wrong in this though.

Giga Berlin makes a big difference once it's completed. The cost reductions are a huge demand lever in case one is needed. Those 15%+ (minimum from tariffs, transport, etc) reductions make $55K Model 3 cost $46,750 possibly doubling it's total addressable market in Europe. This is assuming margins remain the same. As Gerebgraus mentioned the future efficiency improvements could similarly improve margins and/or lower the selling price further. In the best and likely scenario, the margins improve even prices are reduced. Whatever the case Giga Berlin is a big deal for Tesla.

 

[JRP3]

The jeering at Elon in that Twitter thread reminds me of the jeering at Model S...
and Model X...
and Model 3...
and Model Y...
and Powerwall/Powerpack...
and Solar Roof...
and GF1...
and GF2...
and GF3...
and reusable rockets.
Market doesn’t justify reusable launchers, expendable rocket makers argue

The naysayers seem unable to learn from history.

Since most of those were late I think history has taught us something different than you are implying.

 

[PeterJA]

Since most of those were late I think history has taught us something different than you are implying.

Here's some more history:
The first three Falcon 1 launches blew up.
The first several Falcon 9 landings crashed.

This and other history has taught me two things:
1) Elon doesn't give up.
2) Elon can't say exactly when, but he can say what.

 

[JRP3]

Elon can't say exactly when, but he can say what.

When is what causes most of the criticism, especially with FSD. If you assume Elon is wrong about the timing of FSD you'll be right more often than not.

 

[jerry33]

When is what causes most of the criticism, especially with FSD. If you assume Elon is wrong about the timing of FSD you'll be right more often than not.

Anyone who believes new things will always work the first time probably shouldn't be investing because they will be disappointed more often than not, and likely sell at a loss. Investors should always ask "is progress being made", "did they learn from their failures". If the answer is yes, then buy more.

 

[Sudre]

The starting price of Model 3 is roughly $55K in most EU countries (not ~$38K like in the US). That $55K is for SR+. The comparison to avg gas car price makes sense to point out that EV prices need to go down to replace all ICEs on the road. We all know it's happening sooner or later, but currently majority of Europeans cannot afford to buy a Tesla (or even cheaper EV). However, it's totally fine that SR+ version is $21K more expensive than avg car since Tesla is supply constrained. When supply issues are gone we'll see if Tesla prefers maximum profit margins or aggressively increasing market share. I doubt they can sell unlimited number of cars at $55K in Europe. More than happy to be wrong in this though.

Giga Berlin makes a big difference once it's completed. The cost reductions are a huge demand lever in case one is needed. Those 15%+ (minimum from tariffs, transport, etc) reductions make $55K Model 3 cost $46,750 possibly doubling it's total addressable market in Europe. This is assuming margins remain the same. As Gerebgraus mentioned the future efficiency improvements could similarly improve margins and/or lower the selling price further. In the best and likely scenario, the margins improve even prices are reduced. Whatever the case Giga Berlin is a big deal for Tesla.

You still haven't answered why only Tesla counts as needing to get prices lower? I am sure before Tesla Europeans didn't just buy Porsche. There are many other EVs in Europe right? I mean I don't seriously know. If Tesla is the only EV maker then you will never see the prices come down.

Also does your quoted price include taxes or incentives? Again I actually don't know. In the US the SR price does not include destination fees, taxes or incentives.

 

[dw4ngg]

OPEC reaches deal which will likely lift macros more tmrw.