Thoughts on TESLA

[bobandsherry]

Any company that requires a $1,000 deposit to order something that will come, sometime and takes 450,000 orders in backlog and then requires another $2500 this time non-refundable if you want to get a place in line to get a car, when they have orders for 90 months of peak production they have been unable to hit, has a good salesman for a leader and a terrible production company.

Tesla when it first went public was unique. 8 years later it's no longer that unique, styling has remained relatively unchanged. I just can't understand how it maintains the market value it does.

 

[Music Lover]

Tesla when it first went public was unique. 8 years later it's no longer that unique, styling has remained relatively unchanged. I just can't understand how it maintains the market value it does.

Never underestimate the power of green smugness.

Imagine Ford demanding a $1000 deposit for a vehicle that has the same backlog and production problems...keeping in mind that at least Ford has a solid reputation built over several decades.

 

[ERD50]

The $1000 refundable deposit was for many, a bet that they would get in before the $7,500 tax credit was reduced/eliminated. Are there numbers on how many have asked for their $ back?

I'd also be curious, how many Model 3's go out the door for $35,000? Any? That was the "Oh Wow!" among so many greenies, a $35,000 EV with >200 mile range, and only $27,500 after tax credit.

I'd love to see a histogram of the different prices out the door. I would not be surprised if the never sold a Model 3 for $35,000.

-ERD50

 

[ncbill]

No $35,000 Model 3 will be built anytime soon (my bet is not until 2020)

If you want one in the near future (in time to get the full $7,500 federal tax credit) you'll be spending at least $50,000, though IIRC the average configuration comes closer to $60,000.

 

[midwestguy]

You cant buy a 35000 version yet. They are only offering it with the large battery which is 9k more. The deluxe interior is 5k. Paint other than back 1.5k I got one for my daughter (for graduation) was 63k out the door.

 

[bobandsherry]

Last year, Musk noted that Model3 would be closer to $42k and there was estimates that would be closer to $50k.

https://www.google.com/amp/s/electrek.co/2017/04/06/tesla-model-3-average-sale-price-data/amp/

This year it's estimated that the price is now closer to $60K.

https://www.investors.com/news/technology/tesla-stock-model-3-production/

 

[bobandsherry]

24% of Tesla Model 3 orders have been canceled, analyst says

https://money.cnn.com/2018/07/19/technology/business/tesla-downgrade/index.html

 

[Totoro]

Same article has Tesla claiming net orders keep growing,so no negative cashflow impact.

Elon has a certain way of communicating, but I haven't seen Tesla lying yet.

Before the year is out we'll find out if the thing blows up or triumphs. I hope they make it but won't put my own money at risk betting on it.

 

[bobandsherry]

Same article has Tesla claiming net orders keep growing,so no negative cashflow impact.

Elon has a certain way of communicating, but I haven't seen Tesla lying yet.

Before the year is out we'll find out if the thing blows up or triumphs. I hope they make it but won't put my own money at risk betting on it.

Um, I must have missed it, but see nothing that mentions net orders increasing in the article. I did read:

Refunds now outpace deposits for Tesla's new mass-market electric car, according to Needham & Co. analyst Rajvindra Gill. Tesla disputes that.

That seems to be contrary to net orders increasing.

 

[oneill225]

Tesla disputes it:

https://electrek.co/2018/07/19/tesla-model-3-s-x-new-orders-elon-musk/

 

[Totoro]

From the article:

A Tesla spokesperson denied that Model 3 cancellations exceed new orders.

 

[Chuckanut]

I suspect that any of the cancellations may be people who think if they wait a bit, they might actually be able to purchase a Model 3 for $35,000.

 

[bobandsherry]

I suspect that any of the cancellations may be people who think if they wait a bit, they might actually be able to purchase a Model 3 for $35,000.

Those who wait for that day will find the car will cost them more overall due to lower tax credit.

https://money.cnn.com/2018/07/12/autos/tesla-tax-credits/index.html?iid=EL

 

[imoldernu]

17,000 unsold cars in a parking lot.

https://www.nakedcapitalism.com/2018/08/wolf-richter-tesla-discloses-worst-quarterly-loss-ever-17000-model-3-cars-produced-didnt-deliver.html

 

[petershk]

My 2016 model x has about 30k miles on it and I have t had any major problems myself.

It's still by far the best overall car I've driven but the tech in other cars is rapidly catching up.

I have a 3 on order but that was because the line was long and relatives were interested. They are not because the price is too high.

I think a lot of 3 preorders were people waiting in a long line because there was a long line.

I never have owned and think buying Tesla stock at this price is insane. I don't short because I've seen insane prices get more insane and I've seen companies catch up to it.

I dont think Tesla is comparable to Enron...Enron lied about how good it's finances were while fleecing customers through illegal manipulation of energy prices.

That's really different than trying to do something really hard and being overly optimistic and perhaps naive about how hard it is.

You have to give some credit to someone who had 30m and bet it all on starting a car company and a space company. I'm wouldn't do that if I had 30m .

I do think Tesla is in a hard position because they are addicted to the over valuation to race against the cash burn. And that can create all kinds of bad incentives. Theyve been close to death many times so I think Elon Musk is used to that feeling... Maybe even enjoys it.

But then I don't think Tesla's financial state is hidden so if people want to invest in a super high risk insanely overvalued company.. I guess that's their choice. If it turns out they are materially lying that's another matter but when you post hundreds of millions a quarter in losses and simple math tells you when the company runs out of money it's hard to claim you were lied to.

 

[NYEXPAT]

I was over my friends house last week (built in 1929 by a grandson of the Great Robber Baron Jay Gould). When I asked if she still only drove S500's, she took me out to the 6 car garage and showed me her $140,000 Tesla gull wing ( I think it is a X ?). When I asked why she switched, she said they bought Tesla stock years ago and sold it to buy this $5 million Mansion and had money left over so she bought the Tesla and a childrens version for her Grandson.

 

[oneill225]

BS

17,000 unsold cars in a parking lot.

https://www.nakedcapitalism.com/2018/08/wolf-richter-tesla-discloses-worst-quarterly-loss-ever-17000-model-3-cars-produced-didnt-deliver.html

Total BS. Who says they are unsold?

If you want to track Tesla and other EV news (not just anti-Tesla propaganda) I recommend "Electrek": https://electrek.co

 

[Texas Proud]

Tesla's valuation is just insane... first, I do not short stocks at all... but if I did I would NOT short this one because IMO the investors are very much like a cult... they believe!!!



If you gave anybody these numbers without the name Tesla attached to them it would be hard to get anybody to invest... it would be better to go to the thread 'when to invest in GE'....

 

[Totoro]

You have to give some credit to someone who had 30m and bet it all on starting a car company and a space company. I'm wouldn't do that if I had 30m .

As far as I know, he had 30m or so when he sold Zip2. Then he started Paypal, went (almost?) all-in again and walked away with 180m.

After that, he again went all-in twice indeed with both Tesla and SpaceX, he only went public with Tesla because he had to. Luckily his rich friends bridged the gap. The guy is way outside the norm on most scales, and could have easily be living under a bridge by now if things went only a little bit differently.

One source here:
How Elon Musk Made Money Before Tesla | Money

 

[gauss]

I would view Tesla stock similar to Bitcoin. It is speculative and may increase in value, but there is no evidence that it will ever have any sustaining intrinsic value.

The competition in the automotive manufacturing business is intense despite the significant barriers to entry.

If Musk could manage to use his "big personality" to fundamentally change the regulatory rules to favor his product, perhaps this could payoff, but otherwise I see no competitive advantage outside the personality/marketing.

But, then again, I could probably have said the same thing for Apple vs its competitors. The masses have indeed shown a willingness to pay more much more for a product than its utility intrinsic value. I guess lots of folks are willing to pay good money to attempt to purchase prestige.

Human psychology is an interesting phenomenon.

Probably a good thing that I am not in the marketing or business strategy professions.

-gauss

 

[Chuckanut]

A good company does not necessarily mean a good stock.

A good stock does not necessarily mean a good company.

That's why I use index funds.

 

[Chuckanut]

IMHO, what Mr. Musk needs at Tesla is another Gwynne Shotwell.

https://en.wikipedia.org/wiki/Gwynne_Shotwell

Gwynne Shotwell (Rowley; born November 23, 1963) is an American businesswoman. Gwynne Shotwell is President and Chief Operating Officer at SpaceX (Space Exploration Technologies Corporation), where she is responsible for day-to-day operations and company growth.

 

[Totoro]

Probably a good thing that I am not in the marketing or business strategy professions. -gauss

I can assure you that business strategy professionals have little useful to say about Tesla, Bitcoin or Apple.

They still miss their blackberry keyboards ..

 

[ncbill]

Thanks to all the early adopters buying Tesla EVs and lowering the costs for those of us who wait until that tech hits mass-market prices.

 

[bobandsherry]

Thanks to all the early adopters buying Tesla EVs and lowering the costs for those of us who wait until that tech hits mass-market prices.

But you'll miss out on the tax credits the early adopters all took, $7,500 tax credit currently. May actually end up costing you more if price isn't $7,500 less in the future.