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Re: THE Tesla Thread Pt. 2 (merged)

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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby tita » Sat 05 Oct 2019, 08:04:53

asg70 wrote:I have to admit that I have stopped watching every move with Tesla. I thought they were near death when all of its executive started fleeing and its stock tanked but they seem to be able to limp onward like a zombie.


There was quite a slowdown this year, but Tesla managed to keep sales numbers up, introducing gradually cheaper variants and lowering prices of the more expensive variants. Anyway, Model S/X sales plunged while Model 3 sales increased. Also, Tesla cut costs wherever they could.

Each quarter seems like a challenge. Now, Tesla must reach 106k deliveries in Q4 to reach lower guidance. So far, Tesla lost $1.1 billions in the first two quarters and is expected to show a loss in Q3.

The major things this year was the fundraising of over $2 billions and the financing of the Shanghai Factory by Chinese lendors.

As long as investors throw money, there is no reason for Tesla to fail.
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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby Outcast_Searcher » Sat 05 Oct 2019, 11:56:06

tita wrote:
asg70 wrote:I have to admit that I have stopped watching every move with Tesla. I thought they were near death when all of its executive started fleeing and its stock tanked but they seem to be able to limp onward like a zombie.


There was quite a slowdown this year, but Tesla managed to keep sales numbers up, introducing gradually cheaper variants and lowering prices of the more expensive variants. Anyway, Model S/X sales plunged while Model 3 sales increased. Also, Tesla cut costs wherever they could.

Each quarter seems like a challenge. Now, Tesla must reach 106k deliveries in Q4 to reach lower guidance. So far, Tesla lost $1.1 billions in the first two quarters and is expected to show a loss in Q3.

The major things this year was the fundraising of over $2 billions and the financing of the Shanghai Factory by Chinese lendors.

As long as investors throw money, there is no reason for Tesla to fail.

From my analysis and watching on places like Seeking Alpha, that's all absolutely right.

The real question is (IMO), "In the face of all the financial issues like all the debt and ongoing interest expense, and in the face of the growing competition, is there any realistic path to sustained meaningful profitability for Tesla in a reasonable timeframe?'

Because if there's not, then it's just more debt, more interest expense, more capital raises, and at some point, even Tesla fanbois aren't going to want to keep throwing money at the cash burning furnace.

One issue I can't ignore is that in order to CLAIM positive cash flow, Tesla has taken to paring CAPEX to the bone. Well, that works on the accounting statements, but in a company relying on high growth, innovation, and the introduction of lots of new products (which take a lot of research and capital), how realistic is that?

One thing the new competition arriving in '20 and '21 will almost certainly do is continue to drive ASP (average selling prices), and thus gross margins lower. That seems to apparently eat up any cost savings that the bulls are counting on as the means to profitability, at least thus far. Oh, and it won't help the growth story any, which is already radically slowing.

Of course, there's the Shanghai plant, which will likely produce 100,000+ cars in 2020, and there's the Model Y, both of which bulls tout as the next "promised land" for Tesla.

We'll see I guess. I think the Shanghai plant will help with margins. Far less sure about quality. But I think the Model Y will just heavily cannibalize the Model 3 (it's a sedan, not an SUV).

So it's an interesting show to watch. I enjoy my popcorn. My bets, re the success of the EV industry overall are with the competition, their experience, quality, service, know-how, reputation, etc. vs. Tesla's clown-car antics, but that's just me.

However, I do NOT agree with the shorts who keep claiming Tesla is about to go bankrupt short term. Even if they keep losing lots of money, they could potentially keep the show going for quite a few years with fundraising. And while I'm not buying the bull arguments of exponential growth and profits forever, Shanghai COULD get them near parity re profits over time -- which buys them time.

Oh, and the other wild card, IMO, is the regulators and all Tesla's quality and safety problems and accounting issues (think solar roofs, etc) might well start hitting a lot harder re lawsuits, recalls, etc. It would be ironic for the bulls if Tesla would reach operational profitability, but keep piling up debt by dealing with the fallout of all of THAT.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby EdwinSm » Thu 17 Oct 2019, 04:21:35

I guess this is good news for the beleaguered company, if they can reach the numbers hoped for.

BBC wrote:Tesla has been added to the Chinese government's list of approved car manufacturers according to a list published by the ministry of industry and information technology.

The electric carmaker intends to produce at least 1,000 Model 3s a week from its Shanghai factory by the end of this year.


[The quote was from the "Live Business report" so any link might be old by the time you read this]
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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby Outcast_Searcher » Thu 17 Oct 2019, 13:41:01

EdwinSm wrote:I guess this is good news for the beleaguered company, if they can reach the numbers hoped for.

BBC wrote:Tesla has been added to the Chinese government's list of approved car manufacturers according to a list published by the ministry of industry and information technology.

The electric carmaker intends to produce at least 1,000 Model 3s a week from its Shanghai factory by the end of this year.


[The quote was from the "Live Business report" so any link might be old by the time you read this]

This isn't really new news for those who have been watching Tesla. It's an expected event confirmed. Else, Tesla wouldn't have agreed to build the Tesla factory in the first place. If anything, this is confirmation that the plant is actually more or less complete.

What will be interesting to see is how quickly meaningful production actually gets ramped up there, given Tesla's extremely slow and sketchy history with ramping up new production, especially vs. Musk's projections.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby asg70 » Fri 18 Oct 2019, 09:44:54

I think the competition right now is equivalent to nipping at Tesla's heels. It's going to take a while for the competition to reach critical mass, with VW group being the biggest contender.

Volvo has a new XC40 EV coming out as well which has the overall guts of Polestar 2. I don't know the dimensions of it but it doesn't look a hell of a lot bigger than the Kona but it takes 78kwh to achieve 200+ mile range. Poor efficiency, but it has twice the HP and a frunk, faster DC charging, google onboard and ota updates. Overall it looks like a competent vehicle but all the offerings at present have their pros and cons. I do think Hyundai and Kia did a great job achieving the efficiency they did on the Kona and Niro despite their conventional shape. This XC40 and Audi eTron are the equivalent of gas-guzzlers in comparison.

HALL OF SHAME:
-Short welched on a bet and should be shunned.
-Frequent-flyers should not cry crocodile-tears over climate-change.
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Re: THE Tesla Thread Pt. 2 (merged)

Unread postby Outcast_Searcher » Fri 18 Oct 2019, 14:31:52

asg70 wrote:I think the competition right now is equivalent to nipping at Tesla's heels. It's going to take a while for the competition to reach critical mass, with VW group being the biggest contender.

Volvo has a new XC40 EV coming out as well which has the overall guts of Polestar 2. I don't know the dimensions of it but it doesn't look a hell of a lot bigger than the Kona but it takes 78kwh to achieve 200+ mile range. Poor efficiency, but it has twice the HP and a frunk, faster DC charging, google onboard and ota updates. Overall it looks like a competent vehicle but all the offerings at present have their pros and cons. I do think Hyundai and Kia did a great job achieving the efficiency they did on the Kona and Niro despite their conventional shape. This XC40 and Audi eTron are the equivalent of gas-guzzlers in comparison.

Just like with ICE's and HEV's, there are a variety of trade-offs between things like efficiency and size and comfort and amenities and cost. Markets are pretty good at sorting that out. Government is pretty good at coming up with standards via input from various sources, and then reporting on efficiency, relative to that standard.

To me, the more competent competition the better. Consumers having choices will FORCE the EV industry to improve its offerings and keep profits "reasonable".

I still think most consumers are going to care far more about things like quality and service than minor differences in efficiency, especially when the fuel is relatively cheap. It will take some time, but again, the market will certainly tell us.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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