TSLA Market Action: 2018 Investor Roundtable

[JoaoD]

If production was low through Feburary (say 700 cars / week), but theoretically jump to above 2000/ wk by end of March, how would the market react to the mixed news at the end of Q1 reporting?

It would go down, it always goes down when there are good news, right?

 

[gene]

I used my first sell limit order today— previously, I’d done everything with market orders. Bought at 338 (market order) and set a limit order in the 341s, which triggered.

Then I set a buy limit order for 337, which looked unlikely to trigger. Then the InsideEVs numbers came out.

So, now I’ve used limit orders on the sell side and buy side. I’m not a complete Neanderthal, but not far removed.

Please don't disparage Neanderthals They had a brain size 200 ccm larger than ours with much greater body strength and vision like a hawk. What's more, unless you just left east Africa or are a Khoisan tribesman, well then you are 2.5 to 4% Neanderthal DNA yourself. In fact you share more DNA with Neanderthal than you do with your 3rd cousin! Just sayin' !

 

[ZsoZso]

$336 reached, my buy orders went through, so I'm all in again.
So the SP can start rising again! It has my permission

 

[Jayjs20]

It hit support/buy level faster than I thought. I wonder how much more greedy I should be.

 

[Esme Es Mejor]

Please don't disparage Neanderthals

I would never disparage Neanderthals! Merely playing on Sapien-centric stereotypes.

 

[avoigt]

Yes, But the article is a bit confusing in one part. It says that Bosch are basically divesting completely from battery cells but the article states that they believe they need to understand the cell technology but not to manufacture the cells. So I would imagine they would still have some battery cell testing and labs and the like. What is clear to me is that Bosch understood clearly the requirement was to invest $20B over 10 years or so to manufacture cells and they decided that was to risky. But they understood that it was required. Everyone assumes that someone else is going to do it. I think they all assume China will do and dump cells on the market at a loss just like they did with solar. I think that is miss guided. For one, batteries are really really heavy and very expensive to ship half way around the world. This is why Tesla is the only smart company out there. As prices drop, the logistics around raw materials and shipping finished cells around the world is going to become a larger and larger percent of the cost of the cells. Just using dummy numbers, lets say its $200/KWh for Daimler to buy cells from S. Korea. The cost to ship that might only be $10/KWh and the price for S. Korea to get the raw materials from around the world might be $20/KWh including the trip from the mines to where its refined and then a final trip to Korea. If nothing else changes except the cost to manufacture the cells and the price drops to $150/KWh, then that $30/KWh is a much larger percent. As the price drops to $100/KWh it could be as much as 30% of the total cost of the cells. If Tesla has a $0 cost to ship cells because they do not leave the Gigafactory. Tesla is also working on sourcing materials from near where the plant is manufacturing cells. The logistical overhead for Tesla could be as much as 10-15% cheaper then Daimler who might source cells from China or S. Korea. This is not good when you are trying to be competitive. Also, Tesla has a partnership with Panasonic where Tesla is committed to purchase large numbers of cells at a fixed rate that is lower because of the commitment. Is Daimler, an ICEv company going to committed to buy Billions of dollars in cells to get a good price? My best guess is that the competition will be in a constant situation where they are paying more for cells that are of lower quality and thus require better packs to make them both safe and competitive with Tesla in charging and density. You can see this today where you have a car like the Ipace that has a 90KWh pack, is smaller then a model 3 and has a range of about 250miles, which is 60+ less then the Model 3 with a 75KWh pack. That is an impossible hill to climb when it comes to competition. You must really love Jag to buy that vehicle. Why would Daimler have any better pricing? They are no more committed to going Electric and they have not done things required to get prices down. There is only one way, massive scale and highly compressed logistics and supply chain. Scale allows you to buy a company like Ghromann to fully automate the manufacturing process.

The decision from Bosch is a disappointment for sure. They could not bring the numbers together to build a business case to convince the board. Thats bad news for the global EV expansion. If they as the largest OWM supplier can't justify a € 20bn investment to produce 200 GWH who can?

They kind of call the cell production a commodity and I believe, not being a Battery expert, thus to be a strategic mistake that will fire back. It sounds to me like Bosch decided to invest their capital in other areas where they expect better profit which makes sense but if not enough EV Batteries are produced how can be enough cars where Bosch would like to sell other elements into? A first grad understands that you won't have a car to equip if you don't have Battery that powers it....

As a result Bosch even stops all investments in the solid state Battery development and sell there JV.

We can assume that this decision will have a strong negative effect for other investors that considers going into Battery cell and pack production in Europe and make the math as we speak. VW seems to be the last one beside BMW that have the size that could make a difference and could dare to take the risk.

For the years to come we will not have a battery production in Europe (for cars) which creates a competitive edge for suppliers in Asia as well as Tesla, the only existing vertically integrated company in the world on the path to prove profitability.

For Tesla that decision means the moat gets deeper and wider so thats good news. I am delighted to hear that as a Tesla investor and disappointed as a German who want to see the German Automakers to be top notch in the EV future.

 

[Reciprocity]

back in at 335 myself. I understand that it could stop drop from here, but I am not going to be greedy.

 

[bdy0627]

We've already dropped 6.9% from the high of $360 on 2/27. That is similar to our drop from $360 to $335 from 1/23 to 1/26. At that time, the stock then rebounded back up to $360 in 5 trading days.

 

[Reciprocity]

The decision from Bosch is a disappointment for sure. They could not bring the numbers together to build a business case to convince the board. Thats bad news for the global EV expansion. If they as the largest OWM supplier can't justify a € 20bn investment to produce 200 GWH who can?

They kind of call the cell production a commodity and I believe, not being a Battery expert, thus to be a strategic mistake that will fire back. It sounds to me like Bosch decided to invest their capital in other areas where they expect better profit which makes sense but if not enough EV Batteries are produced how can be enough cars where Bosch would like to sell other elements into? A first grad understands that you won't have a car to equip if you don't have Battery that powers it....

As a result Bosch even stops all investments in the solid state Battery development and sell there JV.

We can assume that this decision will have a strong negative effect for other investors that considers going into Battery cell and pack production in Europe and make the math as we speak. VW seems to be the last one beside BMW that have the size that could make a difference and could dare to take the risk.

For the years to come we will not have a battery production in Europe (for cars) which creates a competitive edge for suppliers in Asia as well as Tesla, the only existing vertically integrated company in the world on the path to prove profitability.

For Tesla that decision means the moat gets deeper and wider so thats good news. I am delighted to hear that as a Tesla investor and disappointed as a German who want to see the German Automakers to be top notch in the EV future.

Totally agree, but I think they are wrong about the commodity thought. The battery cell/pack is the most expensive part of the entire vehicle by far. Its more important by a factor of 10 then the rest of the vehicle. Its basically everything that makes an EV work. Its also what requires the most advances over the next couple of decades. It will be a commodity at some point and at that point, Tesla can sell off its factories to suppliers that specialize in that.

 

[Reciprocity]

We've already dropped 6.9% from the high of $360 on 2/27. That is similar to our drop from $360 to $335 from 1/23 to 1/26. At that time, the stock then rebounded back up to $360 in 5 trading days.

I agree, but we had the reiteration of the 8k and we had some macro. We could have some macro help again but we need to see VINs and cars being delivered.

 

[Cosmacelf]

It seemed to me that the reason Bosch exited the battery business had more to do with the fact that they bought a solid state battery company, and they realized the technology wasn't going to pan out anytime soon. Bosch didn't/doesn't have any particular expertise in the highly technical and IP intensive world of cell manufacturing other than the company they bought.

I think the Bosch decision says more about the poor prospects for solid state batteries than anything else.

 

[Waiting4M3]

Totally agree, but I think they are wrong about the commodity thought. The battery cell/pack is the most expensive part of the entire vehicle by far. Its more important by a factor of 10 then the rest of the vehicle. Its basically everything that makes an EV work. Its also what requires the most advances over the next couple of decades. It will be a commodity at some point and at that point, Tesla can sell off its factories to suppliers that specialize in that.

My thinking is that you don't outsource your most valuable IP or part of your product, and would even try to bring in-house if you don't have enough control, just like Apple doesn't outsource iOS/iTunes, Amazon doesn't outsource their warehouse storage/logistics, and now cloud storage. All the auto companies kept traditional ICE power trains in-house. I don't understand why they would not take the same approach to EV. You look at what Tesla is bringing and keeping in-house, it all makes perfect sense, things like battery R&D, production automation, GGF, Grohmann.

 

[Richgoogol]

Son of a....I couldn't resist, bought another 100 shs @ 334

 

[Reciprocity]

Son of a....I couldn't resist, bought another 100 shs @ 334

I bought some ITM leaps as well. J2019.

 

[Tenable]

I've purchased April, June and J19 340 calls around 334. If we continue to drop I'll continue to add. GL to the longs.

Edit: I dont recommend anyone follow my trades, I'm a crazy person.

 

[SwTslaGrl]

I also think Bosch as a supplier needs potential contracts/buyers for battery cells to make the investment. The German automakers seems undecided on this.

As a side note at work we supply some tools for making diesel fuel injectors and incoming orders are up so far this year (and it's only 1 Mars)

 

[Waiting4M3]

It seemed to me that the reason Bosch exited the battery business had more to do with the fact that they bought a solid state battery company, and they realized the technology wasn't going to pan out anytime soon. Bosch didn't/doesn't have any particular expertise in the highly technical and IP intensive world of cell manufacturing other than the company they bought.

I think the Bosch decision says more about the poor prospects for solid state batteries than anything else.

Maybe I will wait for BMW's upcoming battery research center to confirm this in 3-5 years.

...As a side note at work we supply some tools for making diesel fuel injectors and incoming orders are up so far this year (and it's only 1 Mars)

Take their money and buy TSLA with it, burn the candle from both ends

 

[bdy0627]

I've purchased April, June and J19 340 calls around 334. If we continue to drop I'll continue to add. GL to the longs.

Edit: I dont recommend anyone follow my trades, I'm a crazy person.

Did the exact same today. First of 3 waves for me. If I don't get the next 2 waves that's fine.

 

[Waiting4M3]

Just bought some J20 400C, PPS is not at $330 yet but close enough for me.

 

[Big Earl]

I've been taking small bites all day. Super small potatoes compared to some of you guys, but I'm doing what I can.