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

[Thekiwi]

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

TMC should actually already have this: take the biggest pieces of recurring FUD and have a simple one paragraph rebuttal. Make it short enough that it can not only be linked to online, but so that each one paragraph rebuttal can be a simple image to post directly in twitter replies etc.

 

[Remus]

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.

I think Tesla intentionally makes the car more expensive than necessary in China to tell the government that "we are not going to kill all your pets, just the very weak ones".

So, we will see.

 

[JRP3]

What's not to like?

Wasting money on unnecessary advertising which could be better spent elsewhere, for example improving service? All the advertising in the world won't help if there are still real issues with people getting their cars fixed in a timely manner.

 

[neroden]

Real question is the scaleup timeframe (I assume that they've already done enough small-scale testing to be confident in the tech). And whether they'l run in parallel to their solvent lines or perpendicular.

The Maxwell dry binder appears to be ultrafine PTFE powder.

Nasty supply chain there. Hope they get some certifications to avoid making the PFOA environmental contamination problem worse. Also, since it doesn't biodegrade, battery recycling becomes very important.

 

[Artful Dodger]

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.

PETA, or PITA?

 

[neroden]

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).

I don't know how they could expect to show off battery tech and still keep demand for the S/X.

They can say that the new battery tech will arrive in Model S and X "sometime in 2021" and that they will raise the prices massively when they do so

 

[neroden]

So other than @neroden going around the bend a bit hiring himself as COO,

No, no, CRO. Chief Risk Officer is the job I'd be good at.

 

[EVNow]

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.

Indian red tape is … hmm ... flexible. Easiest would be to partner with someone local to make things happen faster - which Tesla may not want to do. But since this will be a high profile investment, a call to Modi will make things go real fast.

 

[TradingInvest]

The "cat out of the bag" comment felt like they were hinting at complete vertical integration from mining to battery to car.
I have mixed feelings about this if true. I like having Panasonic on board making a product to Tesla specs. It reduces some risk but if they won't keep up that is a problem and obviously there is a cost to sub this out.
There was giddiness to the three on stage like we KNOW something you don't.

My take anyway- Nice to see Elon having fun and relaxed (no reefer in sight)

I think getting into mining is the right thing to do. In the next 10 years most likely demand will outstrip supply for key battery materials, simply because EV will grow at a steep rate, mining companies will drag their feet. If Tesla doesn't secure their own supply, they are at the mercy of mining companies. That would be a big business risk. So getting into mining probably will make some money, more importantly can reduce supply risk.

 

[RobStark]

As to advertising, yes, Tesla is selling every car they make. But it would be ideal if they could charge a bit more for each car, and still sell all of them. So using ads to improve the demand curve would make sense, IMHO.

They don't sell every Performance Package they can make.

FSD take rate is not 100%

If they have so many more orders than capacity why can I get any custom ordered Model 3 delivered within 2 weeks?

 

[neroden]

They’ve known all along about correlation of SuperCharger Network and SC location to demand.

No, they haven't. As a company, they realized they were screwing this up only on 16 October 2018. We know this for a fact. Musk specified that it was a "foolish oversight".

Elon Musk on Twitter

It is *magical thinking* to assume that Tesla management knows what we know and that they are making rational decisions based on mysterious things we don't know. If you think that way, you're not an investor, you're a cultist.

 

[Bunky]

Today was signal and a positive signal at that. Tomorrow will be back to noise.

The signal needs to be louder because the noise is deafening.

 

[EVNow]

Wasting money on unnecessary advertising which could be better spent elsewhere, for example improving service? All the advertising in the world won't help if there are still real issues with people getting their cars fixed in a timely manner.

10 Million a year is all that is needed for a decent web presence. Thats a drop in the ocean.

 

[EVNow]

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?

He said a small acquisition. So a small private insurance company ?

 

[neroden]

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?

While paid advertising is probably a poor ROI at the moment, some form of improved public relations / media relations management would probably be a very good ROI. Maybe hire the nice media relations woman who asked the towing question at the annual meeting. Or, you know, *any* trained media relations person.

 

[Zaxxon]

Boy, there sure are a lot--and I mean a lot--of people here that don't understand how advertising works.

Please stop pretending that Q1 wasn't a special situation:
Record Q4 sales
Largest drop in the tax refund incentive
Q1 is a traditionally weak quarter
Strong suspicion, which turned out to be true, of upcoming upgrades to the S and X
Advertising would have changed none of that.

Except, of course, that that's exactly the sort of situation that advertising can change. Again, Tesla didn't massively drop the pricing on S/X because they love small margins, nor are they cell constrained for the S/X. They have (or, I hope, had) a demand problem for S/X. Recall that they guided for around 21k midway through Q1, then proceeded to thoroughly *sugar* the bed. That wasn't planned, and it cost Tesla dearly in Q1.

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.

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.

Amen.

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?

Yes.

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.

See above. Tesla selling every car they make does not mean they are selling the ideal mix or volume of vehicles.

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.

This is another fallacy. Or rather, it's one way that advertising can work, but it's not the only way. Elon disliking sleazy/deceptive/appeal-solely-to-emotion ads that he sees for other brands does not imply that Tesla must follow that path.

Get many more marketing cars out there to let people actually experience the vehicles. Hold annual contests for user-created ads like the one Marques Brownlee won. Stick some targeted web ads out there against searches for competing models. Make an anti-FUD site. Hire more (or more competent) PR people.

This isn't rocket science. Maybe that's why Elon has trouble with it.

 

[JRP3]

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.

In fact if, as it has been since the beginning, demand continues to outpace demand, the FUD will eventually be overwhelmed by reality and they may never need to advertise. If each car sold only promotes 2 additional sales demand won't drop until market saturation.

 

[EVNow]

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.

That was a bad question.

Anyway, Musk said he is open to informational ads - that is really what they need to do. Not some stupid model posing with the car ...

 

[Singuy]

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...

1. Like I said, I'm okay with cash flow +, but it raises questions to why was Elon so sure about GAAP+ from Q3 2018 forward, and as of today Elon has changed his tune despite record deliveries and guide. This is why bears attack the company and Elon for being a "fraud". He says one thing and then change his tune later. Bears thinks this type of behavior is unacceptable and mislead investors.

2. What it was news is what he said. His team showed him the potential exponential progress of FSD and he extrapolated that it'll be feature complete by the end of the year. This doesn't give me too much confidence since his stance with FSD today is that it still needs a lot of work.

3. Not having enough raw material is a big problem if he expect the Model Y to sell more than S3X combined, not to mention the pickup and cell hungry Semi. I am afraid that there will be another disconnect between what he is saying and reality later like the GAAP+ statement. All these products coming out in 2020, him guiding for 500k/year at shanghai just to find that there are only enough raw material for 200k/year.

 

[svp6]

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.

I am trying. Starting with convincing people like you that Tesla can be better. Being immune to criticism is not the way to go forward, no matter how hard you (think) you try. But feel free to continuously bash anyone who is not fanatical about Tesla. It's OK, we cannot all feel the same, and you are entitled to your own opinion.