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

[mongo]

Has anyone discussed that not only did Hertz buy at full price but they also bought before a possible tax credit? They decided paying 7-8k more per car now was less a risk than not having the cars now. Wow.

They ordered 100k, I doubt they already paid for them all. Plus, previous credits were based on delivery date.

 

[Johann Koeber]

IIRC Uber originally wanted to buy a bulk of Tesla production.

Tesla said 'NO'

Now they have found an other way to get access to the cars.

I predict that Hertz will need to buy a lot more EVs. Smart if they choose Tesla.

 

[SmokyPeat]

I think you need a certain number of posts before you can react to other posts.

Ah, that explains it. Thank you. Ready for another melt up today!

 

[UncaNed]

I had to look up that stock trading rule.

As per its name, It says if a stock in IBD’s market leader board moves in certain way that triggered the rule then hold your shares for at least 8 weeks after the rule is triggered even if there is a sell-off because the pattern suggests it can go much higher.

IBD Eight Week Hold Rule

Edit: adding an applicable quote from @Right_Said_Fred :

It could be that TA doesn’t work, it could be that it does. Fact is that thousands of investors base their decisions on TA patterns, making them a self-fulfilling prophecy. So even if TA doesn’t work (I think it does), the fact that so many act on it makes it very valuable.

LInk

Thank you for explaining it, but WHO holds WHICH shares for 8 weeks exactly??

 

[UCF3]

Has anyone discussed that not only did Hertz buy at full price but they also bought before a possible tax credit? They decided paying 7-8k more per car now was less a risk than not having the cars now. Wow.

Even if Hertz qualifies for the tax credit, which I doubt, you think Hertz cut Tesla a check for $4.2 B on Monday? Wouldn’t they just pay Tesla on final delivery just like a normal customer? They will be paying for these Model 3’s throughout 2022.

 

[mongo]

IIRC Uber originally wanted to buy a bulk of Tesla production.

Tesla said 'NO'

Now they have found an other way to get access to the cars.

I predict that Hertz will need to buy a lot more EVs. Smart if they choose Tesla.

In 2015 Uber's CEO said they would buy Tesla's entire production in 2020 if they were self driving.
Stephen Edelstein - Contributing Writer - Green Car Reports
AFAIK, Tesla (Elon) has only blocked sales to potentially high maintenance individuals.

 

[Lessmog]

Ah, that explains it. Thank you. Ready for another melt up today!

Seems you are at 4 posts now. I think you only need one more to give approvals (or not).

 

[Sancho]

Tesla has a demand problem. Way too much demand. This actually gives an opening to its competitors: if people want an EV and don’t want to wait, some of them will buy another EV even though it’s a poor second choice for them.

Tesla needs to be ramping production too fast to rely on opening new gigafactories in new cities, which requires long lead times for planning, land acquisition and approval. I anticipate that it will just expand its Austin, Berlin and Shanghai facilities as fast as possible. Theoretically, it could be churning out 10 million vehicles annually from those three locations by 2025. And even with that they might not meet demand.

They have the land at those locations to expand, and it only takes them a year to replicate another factory on that land.

As the man says: “Let’s Go!”

 

[ammulder]

The credit/rebate would likely only apply to individual taxpayers and not corporations.

In a recent video, @DaveT suggested there was a corporate piece to the proposed EV tax credit. I only see that for chargers with a quick search, but I haven’t read the proposed bill in detail, and all the news on it seemed to be consumer-focused. So I’m not sure.

 

[SOULPEDL]

Uber Drivers Get 50,000 Teslas in Another Blockbuster Hertz Deal

Seems to be unfolding rather quickly. Wait... does Tesla know about this?

 

[kelly]

Ah, that explains it. Thank you. Ready for another melt up today!

5 may be the magic number @SmokyPeat, what do you say to that?

 

[inconel]

Tesla has a demand problem. Way too much demand. This actually gives an opening to its competitors: if people want an EV and don’t want to wait, some of them will buy another EV even though it’s a poor second choice for them.

Tesla needs to be ramping production too fast to rely on opening new gigafactories in new cities, which requires long lead times for planning, land acquisition and approval. I anticipate that it will just expand its Austin, Berlin and Shanghai facilities as fast as possible. Theoretically, it could be churning out 10 million vehicles annually from those three locations by 2025. And even with that they might not meet demand.

They have the land at those locations to expand, and it only takes them a year to replicate another factory on that land.

As the man says: “Let’s Go!”

Does Tesla need new permits whenever they expand the Berlin factory?

 

[Stretch2727]

Tesla improving their manufacturing lines didn't almost cost them the company, it's what made them the raging success that they are today.

Saying that legacy auto knows how to manufacture in volume is doing a grave disservice to Tesla is who is showing legacy auto how bad their volume manufacturing and efficiency actually is. And these are the companies that laughed at Tesla because they had over 100 years of experience they thought was unassailable. In the four short years since the Model 3 ramp began, Tesla has shown them just how little that 100 years of experience was worth. That is the arrogance of legacy auto and it's also what caused them to become so fat and lazy that they can make hundreds of millions of cars over the last 20 years with barely any real profit to show for it. Products that are a terrible value and that threaten our climate. They have failed to do the number one thing that defines a good company: create value. They are value destroyers.

Legacy auto has become so fat and lazy that a small upstart named Tesla, a company smaller than a gnats eyelash relative to the majors, could waltz right in and show them how it's done. The entrenched automakers have been falling all over themselves trying to replicate what Tesla has done with EV's, right down to copying the large center screen that they were so critical of to begin with, and yet their cars still don't measure favorably and they can't even hope to match Tesla on pricing or volumes without going bankrupt.

Yeah, legacy auto really knows how to manufacture in volume. /s

Agree and most of this is because legacy spun off much of the supply base. The legacy manufacturers used to be very vertically integrated but this started to change in the 80s-90's. I worked for one of those spin offs and my impression was the legacy manufacturers became mostly package engineering, i.e figuring out how to fit/package the parts in the vehicle. The real engineering was mostly at the suppliers except for the engine/transmissions and body engineering.

So now engine/transmission engineering is of little use and all the expertise is at the suppliers for all the other parts. Tesla benefitted from this in that they were able to source the run of the mill parts from a huge supply base that had developed outside the legacy manufactures.

This was one reason for my heavy investment in Tesla. Having worked in that environment, I knew there was very little talent to innovate internally and they would be relying heavily on the supply base. Relying on suppliers when there is little innovation and parts have become a commodity puts you in the best cost position. When you need innovate in a disruptive environment you need the expertise internally. I knew legacy would struggle with this and saw little effort from them to bring things back inside. i.e. using LG for BEV powertrain at GM and Ford. The truth is they really had no choice as they had become hollowed out companies with minimal engineering expertise within.

 

[Rarity]

Again, why is Tesla cutting Hertz into it's business model? Why does Tesla need Hertz and Uber between it and Uber drivers? Why does Tesla need Hertz and Carvana between it and used car buyers? Why does Tesla need Hertz on the Tesla Network?

Tesla is starting to get into territory that it won't be able to get itself out of because of politics.

 

[CorneliusXX]

Tesla > Hertz 100,000 by end of 2022 (initial order)
Tesla > Hertz > Uber 50,000 "BY 2023"

"BY 2023" - add own interpretation - Gary Black says not incremental, I say it might / will involve SOME extra cars, but I expect Hertz to increase past its initial order anyway as Teslas prove to be an economic success for Hertz

View attachment 726249

This might be a second use for Hertz. Rent to customers while the vehicles are new, then farm them out to the uber pool once the interior starts getting a little worn.

Buy new Teslas to replace the rental fleet.

 

[st_lopes]

In a recent video, @DaveT suggested there was a corporate piece to the proposed EV tax credit. I only see that for chargers with a quick search, but I haven’t read the proposed bill in detail, and all the news on it seemed to be consumer-focused. So I’m not sure.

From an economic policy perspective that would be extremely difficult to manage.

Imagine dealerships getting rebates from Ford/GM and then turning around selling that to a consumer (hopefully also getting a rebate). The program's budget would immediately be double counting said rebate. Some ways to manage that is to either force more administrative compliance on taxpayers or auto manufacturers (lobbyists don't like administrative burden) or to have the rebate only apply to a VIN once (which means someone in that purchasing chain is going to lose out).

Plus these types of rebates at a corporate level are generally considered taxable income, whereas they would not be in a consumer's hands. From a policy standpoint, it's near impossible to design incentive programs that equally apply to both corporate and individual taxpayer. Integration between corporate and individual taxpayer layers becomes way too messy.

That said, I did read one of the original bills and the particular rebate was individual focused. Though entirely possible it's been modified a number of times since. I'm not even sure what the current language of the bill making its way through congress even is at this point.

Also entirely possible a different section of the bill deals with fleet purchases. I would expect/hope that that section would then have a payback requirement if the corporate buyer were to turn around and resell the vehicle within a set time frame.

 

[Lessmog]

Again, why is Tesla cutting Hertz into it's business model? Why does Tesla need Hertz and Uber between it and Uber drivers? Why does Tesla need Hertz and Carvana between it and used car buyers? Why does Tesla need Hertz on the Tesla Network?

Tesla is starting to get into territory that it won't be able to get itself out of because of politics.

Sorry, I can't see how anyone is getting "cut into" Tesla's business. Tesla sells product. Buyers use it as they see fit.
Who mentioned any link to Tesla Network from Hertz or Uber?
How is Tesla suddenly a captive.

I don't see what you mean at all.

 

[mongo]

Tesla has a demand problem. Way too much demand. This actually gives an opening to its competitors: if people want an EV and don’t want to wait, some of them will buy another EV even though it’s a poor second choice for them.

Tesla needs to be ramping production too fast to rely on opening new gigafactories in new cities, which requires long lead times for planning, land acquisition and approval. I anticipate that it will just expand its Austin, Berlin and Shanghai facilities as fast as possible. Theoretically, it could be churning out 10 million vehicles annually from those three locations by 2025. And even with that they might not meet demand.

They have the land at those locations to expand, and it only takes them a year to replicate another factory on that land.

As the man says: “Let’s Go!”

Tesla's mission is to accelerate the transition to renewable energy. This is better served if the world has Tesla + other EV manufacturers. Tesla is expanding as rapidly as is feasible but cannot instantly support 100% market share. Putting others out of business cuts ICE production now, but cuts EV production later resulting in more older ICE on the road due to lower replacement rates.

Again, why is Tesla cutting Hertz into it's business model? Why does Tesla need Hertz and Uber between it and Uber drivers? Why does Tesla need Hertz and Carvana between it and used car buyers? Why does Tesla need Hertz on the Tesla Network?

Tesla is starting to get into territory that it won't be able to get itself out of because of politics.

Same reason (mission statement). Tesla wants EV to replace ICE ASAP. Hertz/ Uber put the cars on the road now without Tesla needing to deal with the overhead of fleet management.
Moats are lame, speed of EV adoption is all that matters.

 

[Sancho]

This Uber/Hertz deal only makes economic sense for somebody who doesn’t own a car and wants to make a few bucks for a short period of time. Say, a summer job.

For anyone thinking about Ubering for a longer stint, they’d be far better off leasing a Tesla. This rental cost is more than double leasing costs.

But with gas and maintenance savings, this deal will still be attractive to lots of people, which is yet another demonstration of the amazing economics of EVs.

See ya, ICE!

 

[SageBrush]

I don't see what you mean at all.

He is sad that Tesla is not exercising monopoly power over rentals.