TSLA: What Changed?

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Nysoz
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Re: TSLA: What Changed?

Post by Nysoz »

Nathan Drake wrote: Thu Nov 11, 2021 9:49 am
Nysoz wrote: Thu Nov 11, 2021 5:56 am Once all planned/announced factories are built out and optimized they'll potentially have a 5M run rate or so. You can't just count the number of factories and say each have 500-600k run rate and be done. If you look at the land acquired and plan for each of the new factories, they're much larger than the current ones.

There's a reason why VW's Diess is trying to light a fire by comparing VW to Tesla. It takes Tesla 10 hours to build a model 3 where it takes them 3 times as long to make an ID3.

Also, when Tesla bulls talk about manufacturing advantage, they're referring to building the factory and efficient lines (yes some cars still have small panel gaps and squeaks and such). Tesla keeps optimizing factory lines and the manufacturing process to make each new iteration factory even more efficient and can manufacture more in a smaller space. They're eliminating the need for several robots and processes through innovation.

These small things and many more are the reasons why comparing Tesla to a traditional auto manufacturer and old valuations doesn't make sense. They both make things with 4 wheels that move you from point A to B but the entire process and approach is different.
So conventional autos can’t optimize their production lines for EV?
They could but it's hard. All their factories are optimized for building ICE cars. In order to optimize for EVs, they have to shut everything down so they're not making money and at the same time spend millions or billions to optimize their lines for EVs. All while they have their dividends to pay out, pensions and any other costs.

The OEMs are also constrained by supply chain agreements. There's a reason why a lot of newer cars still have infotainment that looks like they're from 5-10 years ago.

Then it's about innovation as well. Tesla is constantly trying to improve/rethink the entire manufacturing process. Creating a new alloy so the front and back of the car can be pressed in 1 part. Integrating the battery into the frame itself to save on weight and parts. Streamlining the wiring in the car to save on costs and weight.

Watch the Sandy Munro teardowns of the Model Y vs the Mach E. It's a lot of small differences that add up to mean a lot.
Ikeprof
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Re: TSLA: What Changed?

Post by Ikeprof »

This excerpt really nails the philosophical approach that Tesla is attempting to apply to their factories. As someone who has spent a lot of time in factories, I just hope that they remember to factor in serviceability and replacement of the production equipment into this picture. It becomes a lot harder to replace a bulky hydraulic pump unit or other device when you have increased the density/lowered the distance a product has to travel by jamming things too tightly together. Regardless - quote
“And it’s like, wow. I do my favorite thing, which is apply physics-first principles. When you think of a production facility on a fundamental level, for a given size of factory, the output is going to be volume times density times velocity. So let’s look at our factory and say okay, what is the density of useful to non-useful volume? It’s crazy low. It’s like two or three percent. If you look at it volumetrically, not just on a planar level, but volumetrically, it’s literally two or three percent when you say car to non-car volumetric ratio. Like wow, that seems like a lot of room for improvement.

“And then you say velocity. What is a reasonable expectation for the exit velocity of vehicles from the factory? And at first you may think that, say these advanced car factories from around the world, and they’re very good at making cars, and they may make a car every 25 seconds. That sounds fast, but actually, if you say, well, the length of the car plus a buffer space is approximately five meters. And so it’s taking 25 seconds to move five meters. Okay, that’s .2 meters per second. Basically, you’re not much faster than a tortoise at that point.

“So it’s like, that doesn’t seem fast. A slow to medium walk would be one meter per second. And a fast walk would be 1.5 meters per second. And the best car factories in the world are doing .2. Seems like we should be able to have cars exit at at least walking speed. This doesn’t seem so crazy.

“And then, the density improvement. There may be as much as an order of magnitude in density possible as well, going from maybe two or three percent to twenty or thirty percent of the volumetric density being optimal. And you also think of it like the design of a modern system on a chip or a computer. If you look at, say, the complexity of the board, and you see how close together the line tracings are and how focused things are on clock speed and data transfer from RAM to solid state disk or the internal CPU cache. It’s like wow, there’s crazy potential for improvement here. I think at least an order of magnitude in potential for improvement on production. And so with significantly less engineering effort, we can make dramatic improvements to the machine that makes the machine.

“I think probably a lot of people will not believe us about this, but I’m absolutely confident that this can be accomplished. We’re basically designing our factory the way you’d design an advanced computer. And in fact, use engineers that are used to that, and have them work on this. And I find once you explain this to a first-rate engineer, the light bulb goes on and they’re like, wow, as JB was saying, they spend huge amounts of effort trying to get a fraction of a percent of improvement on the product itself, but actually, that same amount of effort is an order of magnitude if you focus on building the machine that builds the machine. And it’s just that a lot of engineers don’t realize this is possible. They think there’s a wall. They’re basically operating according to these invisible walls. We’re in the process of going through and explaining that those walls don’t exist, and I think it’s going to be pretty amazing.”
GT99
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Re: TSLA: What Changed?

Post by GT99 »

Nysoz wrote: Thu Nov 11, 2021 5:56 am Once all planned/announced factories are built out and optimized they'll potentially have a 5M run rate or so. You can't just count the number of factories and say each have 500-600k run rate and be done. If you look at the land acquired and plan for each of the new factories, they're much larger than the current ones.

There's a reason why VW's Diess is trying to light a fire by comparing VW to Tesla. It takes Tesla 10 hours to build a model 3 where it takes them 3 times as long to make an ID3.

Also, when Tesla bulls talk about manufacturing advantage, they're referring to building the factory and efficient lines (yes some cars still have small panel gaps and squeaks and such). Tesla keeps optimizing factory lines and the manufacturing process to make each new iteration factory even more efficient and can manufacture more in a smaller space. They're eliminating the need for several robots and processes through innovation.

These small things and many more are the reasons why comparing Tesla to a traditional auto manufacturer and old valuations doesn't make sense. They both make things with 4 wheels that move you from point A to B but the entire process and approach is different.
Can you provide links to plans to get the 4 current factories to 5M? I haven't seen anything close to that. I did recently read about plans to get Shanghai, Texas, and Berlin to 1-1.1M each. My understanding is that with the current Model Y expansion at Fremont it will end up around 750k. I know years ago Tesla was saying 1M at Fremont, but not aware of further plans. That gives a max if 4.05M. Which includes doubling capacity at 2 factories that aren't even open yet and ramping up production in the next 3 years so that they are all at full capacity by the start of 2025 to hit 4M in 2025.

It's amazing to me how difficult it is to find details on Tesla's exact production expansion plans by factory. If you have a link that supports getting to 5M+, I'll gladly read it.
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Re: TSLA: What Changed?

Post by Nysoz »

GT99 wrote: Thu Nov 11, 2021 4:50 pm
Can you provide links to plans to get the 4 current factories to 5M? I haven't seen anything close to that. I did recently read about plans to get Shanghai, Texas, and Berlin to 1-1.1M each. My understanding is that with the current Model Y expansion at Fremont it will end up around 750k. I know years ago Tesla was saying 1M at Fremont, but not aware of further plans. That gives a max if 4.05M. Which includes doubling capacity at 2 factories that aren't even open yet and ramping up production in the next 3 years so that they are all at full capacity by the start of 2025 to hit 4M in 2025.

It's amazing to me how difficult it is to find details on Tesla's exact production expansion plans by factory. If you have a link that supports getting to 5M+, I'll gladly read it.
There's no official projections that I've seen. Just extrapolation, assumptions, and as the bears say hopium. Here are a couple of links suggesting how they can get to 5M with the current factories.

https://www.tesmanian.com/blogs/tesmani ... n-10-years

https://electrek.co/2020/07/30/tesla-gi ... omparison/

Keep in mind what they're currently building in Berlin is just phase 1 of 4 as you can see in the highlighted section of the second link. That one alone is supposed to be 500k production.

So the path is there, it's just execution which is going to be difficult without a doubt. Biggest hurdles I see are supply chain issues and battery bottlenecks. With each new factory they're trying to source more things locally which should help. The battery issue has always been the limiting factor. Tesla is supposedly making good progress on their new 4680 battery line and on every earnings call says they'll buy every single battery possible as long as it's made sustainably and a reasonable price.
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Re: TSLA: What Changed?

Post by GT99 »

Nysoz wrote: Fri Nov 12, 2021 5:55 am
GT99 wrote: Thu Nov 11, 2021 4:50 pm
Can you provide links to plans to get the 4 current factories to 5M? I haven't seen anything close to that. I did recently read about plans to get Shanghai, Texas, and Berlin to 1-1.1M each. My understanding is that with the current Model Y expansion at Fremont it will end up around 750k. I know years ago Tesla was saying 1M at Fremont, but not aware of further plans. That gives a max if 4.05M. Which includes doubling capacity at 2 factories that aren't even open yet and ramping up production in the next 3 years so that they are all at full capacity by the start of 2025 to hit 4M in 2025.

It's amazing to me how difficult it is to find details on Tesla's exact production expansion plans by factory. If you have a link that supports getting to 5M+, I'll gladly read it.
There's no official projections that I've seen. Just extrapolation, assumptions, and as the bears say hopium. Here are a couple of links suggesting how they can get to 5M with the current factories.

https://www.tesmanian.com/blogs/tesmani ... n-10-years

https://electrek.co/2020/07/30/tesla-gi ... omparison/

Keep in mind what they're currently building in Berlin is just phase 1 of 4 as you can see in the highlighted section of the second link. That one alone is supposed to be 500k production.

So the path is there, it's just execution which is going to be difficult without a doubt. Biggest hurdles I see are supply chain issues and battery bottlenecks. With each new factory they're trying to source more things locally which should help. The battery issue has always been the limiting factor. Tesla is supposedly making good progress on their new 4680 battery line and on every earnings call says they'll buy every single battery possible as long as it's made sustainably and a reasonable price.
I appreciate the response and links, but I have to say, this is a perfect example of why I'm bullish on Tesla the company and bearish on the stock. And I mean this very broadly, not pointedly at you, but people (including highly paid analysts) are making projections of Tesla's future production based on conjecture, rumor, and things like available land for capacity. But no specific plans. Your links are both speculation from over a year ago. That doesn't mean these things can't happen, but projections like the Gary Black one previously discussed should be done on "most likely" scenario, not "this could possibly happen based on rumors and thumb in the air estimates."
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Re: TSLA: What Changed?

Post by harikaried »

Nysoz wrote: Fri Nov 12, 2021 5:55 amBerlin is just phase 1 of 4
What's the current phase of Giga Nevada? The building size has been relatively unchanged for the last several(?) years and roughly ⅓ of the original planned footprint. Then again, Giga Shanghai quickly doubled from just 3 to also Y.
Nysoz
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Re: TSLA: What Changed?

Post by Nysoz »

Yeah there's a lot of hyperbulls out there with their models out to 2030 with DCF models. Getting to 2025 is going to be hard enough without trying to figure out all the hardships getting to 2030.

Giga Nevada has been slowly increasing their battery lines with Panasonic. I think the bottleneck here is the raw materials needed to exponentially grow battery production for Tesla as well as the rest of the auto industry. On the earnings calls, Musk says they'll buy all the batteries made sustainably. Also how he needs everyone to mine more nickel and trying to find new ways to get the raw materials from the ground.

Technology also changes and Tesla has their pilot 4680 battery line on Kato road. Perhaps once they get that manufacturing process down, they'll revamp their lines there instead of growing old technology. Lots of speculation and forward looking involved for sure.
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MinnGuyInvesting
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Re: TSLA: What Changed?

Post by MinnGuyInvesting »

Yesterdaysnews wrote: Mon Nov 01, 2021 7:53 pm This stock is simply insane.
My TSLA holding is up 54% on the year.
Really glad it's part of the S&P 500 since it's helping my "traditional" holdings as well.
Index ETF's 45% |ARK Funds 30% | AAPL 5% | TSLA 4% | GOOGL 2% | AMZN 1.3% |Other stocks 4.5% | BTC/ETH 9% |
Nathan Drake
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Re: TSLA: What Changed?

Post by Nathan Drake »

MinnGuyInvesting wrote: Wed Nov 17, 2021 2:32 pm
Yesterdaysnews wrote: Mon Nov 01, 2021 7:53 pm This stock is simply insane.
My TSLA holding is up 54% on the year.
Really glad it's part of the S&P 500 since it's helping my "traditional" holdings as well.
The issue with this is it will only be actualized if it’s sold for significant gain

That 54% rise could be followed by an 80+% drop
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finite_difference
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Re: TSLA: What Changed?

Post by finite_difference »

Nathan Drake wrote: Thu Nov 11, 2021 9:49 am
Nysoz wrote: Thu Nov 11, 2021 5:56 am Once all planned/announced factories are built out and optimized they'll potentially have a 5M run rate or so. You can't just count the number of factories and say each have 500-600k run rate and be done. If you look at the land acquired and plan for each of the new factories, they're much larger than the current ones.

There's a reason why VW's Diess is trying to light a fire by comparing VW to Tesla. It takes Tesla 10 hours to build a model 3 where it takes them 3 times as long to make an ID3.

Also, when Tesla bulls talk about manufacturing advantage, they're referring to building the factory and efficient lines (yes some cars still have small panel gaps and squeaks and such). Tesla keeps optimizing factory lines and the manufacturing process to make each new iteration factory even more efficient and can manufacture more in a smaller space. They're eliminating the need for several robots and processes through innovation.

These small things and many more are the reasons why comparing Tesla to a traditional auto manufacturer and old valuations doesn't make sense. They both make things with 4 wheels that move you from point A to B but the entire process and approach is different.
So conventional autos can’t optimize their production lines for EV?
Well, according to VW itself, AFTER they optimize their plant in Germany for billions of dollars it will still take them 20 hours to build an EV (down from 30).

But Tesla does it in 10 hours, which is apparently astonishing to them.
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Re: TSLA: What Changed?

Post by Gundy »

Considering the poor build quality, perhaps Tesla should take longer than 10 hours to build a car.
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Re: TSLA: What Changed?

Post by Soysauceonrice »

Gundy wrote: Mon Nov 29, 2021 12:15 pm Considering the poor build quality, perhaps Tesla should take longer than 10 hours to build a car.
Yea, they definitely need to work on their build quality. For example my 2021 model 3 has a noticeable difference in the gap between the door and the B pillar from the drivers side and passenger side. From inside the car, the gap on the driver side is big enough for me to fit my Iphone snuggly inside. But the phone doesn’t fit in the same gap on the passenger side.

But fit and finish on the Teslas have been a known issue since forever. All of these issues haven’t hurt demand at all and despite 50% year over year growth in production, they still can’t keep up with demand. They *should* fix these issues. But with the demand where it is, I don’t see the incentive to do so.
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Re: TSLA: What Changed?

Post by Nathan Drake »

Soysauceonrice wrote: Mon Nov 29, 2021 2:02 pm
Gundy wrote: Mon Nov 29, 2021 12:15 pm Considering the poor build quality, perhaps Tesla should take longer than 10 hours to build a car.
Yea, they definitely need to work on their build quality. For example my 2021 model 3 has a noticeable difference in the gap between the door and the B pillar from the drivers side and passenger side. From inside the car, the gap on the driver side is big enough for me to fit my Iphone snuggly inside. But the phone doesn’t fit in the same gap on the passenger side.

But fit and finish on the Teslas have been a known issue since forever. All of these issues haven’t hurt demand at all and despite 50% year over year growth in production, they still can’t keep up with demand. They *should* fix these issues. But with the demand where it is, I don’t see the incentive to do so.
Then we are not comparing equivalent products if Teska is willing to sacrifice build time for build quality
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Nysoz
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Re: TSLA: What Changed?

Post by Nysoz »

Tesla's fit and finish could definitely use work. People focus on this as a deterrent to buy the car, but wait times of months means that the buyers at a whole don't care, the fit and finish issues aren't as wide spread/bad as some make them out to be, or both. I noticed my Model 3 bumper was slightly off after 10 months of owning the car so Tesla mobile service fixed it in my garage for free. So I fall into the category where I don't care because it took me 10 months to notice it and they ultimately made it right.

Comparative products or not, if Tesla is making a Model 3 in 10 hours and profiting $14k on each of them while VW is making an ID.3 in 30 hours while profiting $5.4k on each car then it shows that Tesla is doing something fundamentally different than OEMs.

https://twitter.com/forwardcap/status/1 ... 74466?s=20
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Re: TSLA: What Changed?

Post by randomguy »

Soysauceonrice wrote: Mon Nov 29, 2021 2:02 pm
Gundy wrote: Mon Nov 29, 2021 12:15 pm Considering the poor build quality, perhaps Tesla should take longer than 10 hours to build a car.
Yea, they definitely need to work on their build quality. For example my 2021 model 3 has a noticeable difference in the gap between the door and the B pillar from the drivers side and passenger side. From inside the car, the gap on the driver side is big enough for me to fit my Iphone snuggly inside. But the phone doesn’t fit in the same gap on the passenger side.

But fit and finish on the Teslas have been a known issue since forever. All of these issues haven’t hurt demand at all and despite 50% year over year growth in production, they still can’t keep up with demand. They *should* fix these issues. But with the demand where it is, I don’t see the incentive to do so.
You could have said the same thing about GM cars in the 60s/70s. Poor quality doesn't hurt til it does.... Tesla has basically had a niche market for the past 10 years which let them get away with sub par cars.. The market has been slowly growing and pretty much everyone under the sun is entering it. History is full of early leaders who hang on AND early leaders who get gobbled up. Maybe the future is everyone buying Toyotas with solid state batteries that run with no problems for 20 years and electrify america makes the super charger network a footnote. Maybe Tesla keeps out in front long enough to become a dominate player.

Who knows. But I am willing to be that it will be pretty hard for one player to be much more dominate than companies like VW and Toyota are today. The space is just too competitive and unlike things like the iPhone, the network effect probably isn't strong enough to give us just 2 winners.
Even if Ford, GM, toyota and the rest get done in by legacy issues. It is hard to imagine lucid, Rivian, and the zillion chinese companies not coming up with competitors to fracture the market..
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Re: TSLA: What Changed?

Post by Soysauceonrice »

Nathan Drake wrote: Mon Nov 29, 2021 2:36 pm
Soysauceonrice wrote: Mon Nov 29, 2021 2:02 pm
Gundy wrote: Mon Nov 29, 2021 12:15 pm Considering the poor build quality, perhaps Tesla should take longer than 10 hours to build a car.
Yea, they definitely need to work on their build quality. For example my 2021 model 3 has a noticeable difference in the gap between the door and the B pillar from the drivers side and passenger side. From inside the car, the gap on the driver side is big enough for me to fit my Iphone snuggly inside. But the phone doesn’t fit in the same gap on the passenger side.

But fit and finish on the Teslas have been a known issue since forever. All of these issues haven’t hurt demand at all and despite 50% year over year growth in production, they still can’t keep up with demand. They *should* fix these issues. But with the demand where it is, I don’t see the incentive to do so.
Then we are not comparing equivalent products if Teska is willing to sacrifice build time for build quality
That's going a bit far isn't it ? There are lots of differences between a Tesla EV and say, a Ford Mustang Mach E. Depending on how nit-picky you are, these differences can make them non-equivalent products.

Tesla has worse fit-and-finish than the traditional car-makers, that is true. Some people also complain that the Model 3, which its glaring lack of buttons/knobs/switches and over-reliance on pushing everything to the display makes the interior too bland. But that's a conscious choice that Tesla has made to speed up production that the traditional car manufacturers have not.

If I had bought a Mach E, I can't charge at a Tesla supper-charger, but a Tesla can charge at non-tesla chargers with the right adapter. A Mach E doesn't have access to the extensive network of destination chargers. And I can't buy a Mach E directly from Ford; I have to deal with the headache that comes from middlemen dealers who can add a premium on top of the MSRP of as much as $20,000. I don't think any of these differences make them non-comparable. If it doesn't use gasoline and is a Battery Electric Vehicle, it's safe to say they're comparable.
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Re: TSLA: What Changed?

Post by firebirdparts »

I always say the car business is cruel, but I don't really think Tesla's shortcuts are all that important. They're building at a profit, that's the important thing. If the stuff they omitted is the way forward, everybody will just copy it. You can't patent using an Ipad to turn the lights on. Cars with this style interface have been "car of the future" at the detroit auto show for 20 years.

Time to build a car is not really the right metric for any meaningful argument, but I realize that's a low bar. Most arguments aren't meaningful anyway.
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Re: TSLA: What Changed?

Post by unclescrooge »

firebirdparts wrote: Tue Nov 30, 2021 8:52 am I always say the car business is cruel, but I don't really think Tesla's shortcuts are all that important. They're building at a profit, that's the important thing. If the stuff they omitted is the way forward, everybody will just copy it. You can't patent using an Ipad to turn the lights on. Cars with this style interface have been "car of the future" at the detroit auto show for 20 years.

Time to build a car is not really the right metric for any meaningful argument, but I realize that's a low bar. Most arguments aren't meaningful anyway.
If you deduct all the state and government subsidies that were directly paid to Tesla, those profits vanish.
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Re: TSLA: What Changed?

Post by Inframan4712 »

unclescrooge wrote: Tue Nov 30, 2021 1:21 pm
firebirdparts wrote: Tue Nov 30, 2021 8:52 am I always say the car business is cruel, but I don't really think Tesla's shortcuts are all that important. They're building at a profit, that's the important thing. If the stuff they omitted is the way forward, everybody will just copy it. You can't patent using an Ipad to turn the lights on. Cars with this style interface have been "car of the future" at the detroit auto show for 20 years.

Time to build a car is not really the right metric for any meaningful argument, but I realize that's a low bar. Most arguments aren't meaningful anyway.
If you deduct all the state and government subsidies that were directly paid to Tesla, those profits vanish.
Could you provide some numbers to back that up? I mean, we are talking about $14k profit per car times hundreds of thousands of cars per year.

And if you’re able to do that, can you compare that to subsidies to other ICE manufacturers like BMW in South Carolina and Toyota in Tennessee?
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Re: TSLA: What Changed?

Post by unclescrooge »

Inframan4712 wrote: Tue Nov 30, 2021 2:29 pm
unclescrooge wrote: Tue Nov 30, 2021 1:21 pm
firebirdparts wrote: Tue Nov 30, 2021 8:52 am I always say the car business is cruel, but I don't really think Tesla's shortcuts are all that important. They're building at a profit, that's the important thing. If the stuff they omitted is the way forward, everybody will just copy it. You can't patent using an Ipad to turn the lights on. Cars with this style interface have been "car of the future" at the detroit auto show for 20 years.

Time to build a car is not really the right metric for any meaningful argument, but I realize that's a low bar. Most arguments aren't meaningful anyway.
If you deduct all the state and government subsidies that were directly paid to Tesla, those profits vanish.
Could you provide some numbers to back that up? I mean, we are talking about $14k profit per car times hundreds of thousands of cars per year.

And if you’re able to do that, can you compare that to subsidies to other ICE manufacturers like BMW in South Carolina and Toyota in Tennessee?
There was a website that provides a detailed breakdown of government subsidies to all companies. Maybe it was goodjobsfirst.org?

I looked at it several months ago and found a detailed spreadsheet. The total subsidies matched the profit that Tesla claimed in it's history until that time.
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Re: TSLA: What Changed?

Post by athan »

unclescrooge wrote: Tue Nov 30, 2021 4:57 pm
Inframan4712 wrote: Tue Nov 30, 2021 2:29 pm
unclescrooge wrote: Tue Nov 30, 2021 1:21 pm
firebirdparts wrote: Tue Nov 30, 2021 8:52 am I always say the car business is cruel, but I don't really think Tesla's shortcuts are all that important. They're building at a profit, that's the important thing. If the stuff they omitted is the way forward, everybody will just copy it. You can't patent using an Ipad to turn the lights on. Cars with this style interface have been "car of the future" at the detroit auto show for 20 years.

Time to build a car is not really the right metric for any meaningful argument, but I realize that's a low bar. Most arguments aren't meaningful anyway.
If you deduct all the state and government subsidies that were directly paid to Tesla, those profits vanish.
Could you provide some numbers to back that up? I mean, we are talking about $14k profit per car times hundreds of thousands of cars per year.

And if you’re able to do that, can you compare that to subsidies to other ICE manufacturers like BMW in South Carolina and Toyota in Tennessee?
There was a website that provides a detailed breakdown of government subsidies to all companies. Maybe it was goodjobsfirst.org?

I looked at it several months ago and found a detailed spreadsheet. The total subsidies matched the profit that Tesla claimed in it's history until that time.
So, according to the above website, Tesla has has around 2B in subsidies since 2010.
GM has had almost 60B in subsidies and bailouts.
Ford is around 35B since 2010.

The argument about Tesla getting subsidies is ridiculous compared to other car companies. Let's not even compare oil and gas subsidies to Tesla.

The reality is that Tesla would destroy the competition on a level playing field. At first Tesla was not making profit for each car produced. That is expected in any manufacturing field where you are making a new product.

GM and Ford will have to go through learning pains while losing money per electric car produced, just like Tesla. However, Tesla is through to the other side and will continue to increase profit per car.

The only thing that might save GM and Ford is the government applying more bailouts and subsidies to make it appear they can compete with Tesla.
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Re: TSLA: What Changed?

Post by athan »

Oh and by the way Tesla has almost no debt, and has paid back the majority of their loans early. The legacy auto companies are swimming in debt and need subsidies because they cannot compete. I find the Tesla subsidy argument lazy at best, and a flat out lie to the informed.
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Re: TSLA: What Changed?

Post by Dottie57 »

Valuethinker, I don’t believe Electric cars will be as prevalent in 5-10 years as you do. I think it will be slower - more likely 12-20. The main problem will be charging. Lots of people living in apartments, condos and townhouses (to some extent) which are problematic to get electricity fitted for EV. I have a newish car and I hope it is at least 10 years away from being traded.

This will expensive to be transition for many people.
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Re: TSLA: What Changed?

Post by Ikeprof »

LOL interesting timing. I was just reading this today while learning what an Altman Z-Score is

https://www.tesmanian.com/blogs/tesmani ... n-z-scores
athan
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Re: TSLA: What Changed?

Post by athan »

Ikeprof wrote: Tue Nov 30, 2021 5:47 pm LOL interesting timing. I was just reading this today while learning what an Altman Z-Score is

https://www.tesmanian.com/blogs/tesmani ... n-z-scores
1.91 Tesla
1.84 Honda
(financial distress zone is any score below 1.81)
1.77 Toyota
1.38 Nissan
1.35 Fiat Chrysler
1.14 Volkswagen
1.09 Daimler
1.09 GM
0.95 Ford
0.79 BMW
-4.36 NIO

It's crazy that even with these numbers, Tesla still has a lower credit rating than most of these debt ridden dinosaurs.
harikaried
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Re: TSLA: What Changed?

Post by harikaried »

unclescrooge wrote: Tue Nov 30, 2021 4:57 pmThe total subsidies matched the profit that Tesla claimed in it's history until that time
That seems quite misleading to compare as the largest subsidy listed there for Giga Nevada is using the maximum $1.3B tax abatement value projected through 2034 (20 years) whereas Tesla profits are at most counted through 2021. Nevada reported in 2018 Tesla Economic Impact Study that Tesla had actually exceeded multiple requirements and generated more revenue than the state originally anticipated.

But even using the full 20 years of projected tax subsidies, Tesla's most recent earnings report from 21Q3 shows $1.6B GAAP net income, so should that 3 months of income exceeding the subsidies mean any future income should be considered subsidy-free?

In fact, Tesla/Elon Musk is now saying they're declining €1B+ subsidies that might come with onerous terms probably because they can expand faster on their own terms using their own cash.
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unclescrooge
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Re: TSLA: What Changed?

Post by unclescrooge »

athan wrote: Tue Nov 30, 2021 5:21 pm There was a website that provides a detailed breakdown of government subsidies to all companies. Maybe it was goodjobsfirst.org?

I looked at it several months ago and found a detailed spreadsheet. The total subsidies matched the profit that Tesla claimed in it's history until that time.
So, according to the above website, Tesla has has around 2B in subsidies since 2010.
GM has had almost 60B in subsidies and bailouts.
Ford is around 35B since 2010.

The argument about Tesla getting subsidies is ridiculous compared to other car companies. Let's not even compare oil and gas subsidies to Tesla.

The reality is that Tesla would destroy the competition on a level playing field. At first Tesla was not making profit for each car produced. That is expected in any manufacturing field where you are making a new product.

GM and Ford will have to go through learning pains while losing money per electric car produced, just like Tesla. However, Tesla is through to the other side and will continue to increase profit per car.

The only thing that might save GM and Ford is the government applying more bailouts and subsidies to make it appear they can compete with Tesla.
[/quote]
When I calculated it, I think it was slightly more than $3B.

I'm not saying the government should prop up failing, debt-ridden companies just to get those juicy union votes, but if you're going to compare them you should also add in the value of those $7.5k tax credits plus various state credits.

Anyway, I don't have a dog in this fight. I have zero exposure to Tesla stock and if my funds happen to buy some, I'm not going to get upset.

If you're right and I'm wrong, that's fine too.
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firebirdparts
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Re: TSLA: What Changed?

Post by firebirdparts »

athan wrote: Tue Nov 30, 2021 5:54 pm
Ikeprof wrote: Tue Nov 30, 2021 5:47 pm LOL interesting timing. I was just reading this today while learning what an Altman Z-Score is

https://www.tesmanian.com/blogs/tesmani ... n-z-scores
1.91 Tesla
1.84 Honda
(financial distress zone is any score below 1.81)
1.77 Toyota
1.38 Nissan
1.35 Fiat Chrysler
1.14 Volkswagen
1.09 Daimler
1.09 GM
0.95 Ford
0.79 BMW
-4.36 NIO

It's crazy that even with these numbers, Tesla still has a lower credit rating than most of these debt ridden dinosaurs.
Yep. Nature of the beast.

At least these guys are still making cars. that's more than you can say for Austin, Holden, Triumph, Ford of Australia, Saab, etc. Sometimes you just have to punt.
This time is the same
impatientInv
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Re: TSLA: What Changed?

Post by impatientInv »

I don't fully understand this stock and how this has persisted for so long, especially for $1.3T company.
Reasons I can think of..
1. Fans of Elon think that he is changing/saving the world or just a "fun guy"
2. Buyers of Tesla, loving EVs performance - bought in heavily (low reliability scores matters less as these people have other cars or believe in 1)
3. Gamma Squeeze - with retail investors, momentum chasing funds (and others?)
Was $TSLA's run from $50 to $800 the Greatest Gamma Squeeze of All Time? Consider these call option volumes...

Sep 2019 - 1.5M calls (normal)
Dec 2019 - 8.6M calls (yuge)
Aug 2020 - 19.4M calls (wtf m8)
Dec 2020 - 36.3M calls (come on man!)

Data from https://theocc.com
https://twitter.com/Ross_Report/status/ ... 7870993411
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No individual stocks.
athan
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Re: TSLA: What Changed?

Post by athan »

Keep in mind that Tesla's stock did nothing from 2015-2020. It seems crazy how quickly it went from 40 to 800, but if you factor in the 5 years Tesla grew as a company without stock growth, it makes more sense. I think Tesla had/has a lot of enemies in oil and gas and auto. They tried to keep the stock down in hopes it would bankrupt Tesla. While this almost worked, Tesla survived and the stock shot up when the market realized Tesla was thriving.
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peskypesky
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Re: TSLA: What Changed?

Post by peskypesky »

Tesla’s stock is still cheap, says manager of new ETF who made Musk’s EV company its No. 1 holding

https://www.marketwatch.com/story/tesla ... =home-page
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firebirdparts
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Re: TSLA: What Changed?

Post by firebirdparts »

impatientInv wrote: Wed Dec 01, 2021 7:38 am I don't fully understand this stock and how this has persisted for so long, especially for $1.3T company.
Reasons I can think of..
1. Fans of Elon think that he is changing/saving the world or just a "fun guy"
2. Buyers of Tesla, loving EVs performance - bought in heavily (low reliability scores matters less as these people have other cars or believe in 1)
3. Gamma Squeeze - with retail investors, momentum chasing funds (and others?)
I'm totally in the love/fun guy camp. I don't think it's weird at all, compared to all the other stuff going on.

Full disclosure; only own tsla in index funds.
This time is the same
Valuethinker
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Re: TSLA: What Changed?

Post by Valuethinker »

impatientInv wrote: Wed Dec 01, 2021 7:38 am I don't fully understand this stock and how this has persisted for so long, especially for $1.3T company.
Reasons I can think of..
1. Fans of Elon think that he is changing/saving the world or just a "fun guy"
Agree re cult of personality. Which can turn around and bite you.

However I think this is more about price momentum than anything else. It has gone up a lot and that attracts fans.
2. Buyers of Tesla, loving EVs performance - bought in heavily (low reliability scores matters less as these people have other cars or believe in 1)
On a trillion dollar market cap, I wonder how big that factor can be?

I wonder whether it's more indirect. The enthusiasm of Tesla owners for their vehicles infects investors, a much much larger group of individuals (and portfolio managers).

I don't think Tesla's have low reliability? What they have is low build quality (and abysmal customer service). An EV generally is inherently a lot simpler than a conventional ICE vehicle - and thus lots less to go wrong.
3. Gamma Squeeze - with retail investors, momentum chasing funds (and others?)

Was $TSLA's run from $50 to $800 the Greatest Gamma Squeeze of All Time? Consider these call option volumes...

Sep 2019 - 1.5M calls (normal)
Dec 2019 - 8.6M calls (yuge)
Aug 2020 - 19.4M calls (wtf m8)
Dec 2020 - 36.3M calls (come on man!)
This, or a variation of this, might be the key.

I am not sure if it was the number of call options. But it was the most shorted stock, and so that bull run would have shaken out a lot of bears, and in the process driving the stock ever higher.

I think (thought?) a lot of Tesla's share price was simply explainable by momentum factors. As it went up, it got more and more painful for investors to be underweight it (active managers). And also it attracted more and more fans.

Of course, the business has also had storming success. With all the caveats about the feet of clay that are also visible. But Musk has done something pretty amazing -- he's a genuine industry disruptor.

In other words, I think this stock is to the present day what RCA was to the late 1920s. The new new thing. I keep expecting it to all go wrong, but it does not.
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Re: TSLA: What Changed?

Post by Valuethinker »

Dottie57 wrote: Tue Nov 30, 2021 5:46 pm Valuethinker, I don’t believe Electric cars will be as prevalent in 5-10 years as you do. I think it will be slower - more likely 12-20. The main problem will be charging. Lots of people living in apartments, condos and townhouses (to some extent) which are problematic to get electricity fitted for EV. I have a newish car and I hope it is at least 10 years away from being traded.

This will expensive to be transition for many people.
EVs can rise to be a large proportion of car sales, but the majority of cars on the road will still be ICE vehicles (diesel or gas). Annual sales only turn over a small portion of the car "park" in a developed country. Say USA has something like 185m on the road light vehicles, then annual sales of 15m or so imply turnover every c 13 years (the actual life of a car is about 13 years on average, but it's not necessarily a good assumption to assume that is a nice normal distribution curve ie with half above that and half below). By contrast, I imagine China has something like 350m equivalent vehicles, but sales over 18m pa.

Depends on country how fast adoption will take place. They will be in China and in Europe. Japan the incumbent car makers have fought a successful rearguard action due to their investment in hydrogen fuel cell vehicle technology. But that may not be true in the future.

People will charge them at work. Or on the street - we have both lamppost chargers (trickle ie Level 1 AFAIK) here in London and dedicated chargers (look like parking machines) on High Streets. About 30% of UK households don't have their own dedicated parking spaces.

Since most North American homes have their own parking (I would venture 80% ish?) then installing chargers at home is not that difficult (basically a Level 2 charger will be the same size of circuit as your stove or your AC). Even condos come with parking spots? Cost per charger should be less than $2k (it could be a lot less). So less than the cost of upgrading your options package on a typical car.

(the local Low Voltage grid is not configured for all of us charging our cars between 4pm and 930 pm ish on a weekday. Time of Use pricing will be a feature of electric car charging. We will charge our cars either in the middle of the day (when the solar PV panels at work or home are at max production) or say 11 pm to 4.30 am.)

In terms of how we use chargers, I think sharing models will also emerge. I am out in the day, so someone else parks in my driveway and charges. I note this because a colleague already rents her car out during the week (not sure the name of the App) and earns more than her car payment every month.

I doubt most car owners drive more than 200 miles per week (i realise it will be relatively high in North America) and that's more or less 1 full discharge of a car power pack now (picking Hyundai as an example). That's not insurmountably difficult to manage even with Level 1 chargers (ie power cords).

The high initial cost of EVs is a factor and a barrier to adoption. Even if Lifecycle Cost of ownership is lower. Batteries are a big chunk of that cost so it depends on how fast battery costs come down - historically they have shown steady declines.

I think it's one of those technologies that will hit a "tipping point". In the jargon of the S Curve of product adoption, it will "cross the chasm" from the experimentalists to the early adopters. I suspect that point has in fact already been reached in some places (15% of UK car sales in recent months have been EVs, although the 12m proportion is more like 5% -- and our charger network is anything but built out). I do notice how many EVs I see - and it's only the distinctive ones (like Teslas, BMW i3s etc) that I would notice.
Dottie57
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Re: TSLA: What Changed?

Post by Dottie57 »

Valuethinker wrote: Thu Dec 02, 2021 12:46 pm
Dottie57 wrote: Tue Nov 30, 2021 5:46 pm Valuethinker, I don’t believe Electric cars will be as prevalent in 5-10 years as you do. I think it will be slower - more likely 12-20. The main problem will be charging. Lots of people living in apartments, condos and townhouses (to some extent) which are problematic to get electricity fitted for EV. I have a newish car and I hope it is at least 10 years away from being traded.

This will expensive to be transition for many people.
Depends on country. They will be in China and in Europe. Japan the incumbent car makers have fought a successful rearguard action due to their investment in hydrogen fuel cell vehicle technology. But that may not be true in the future.

People will charge them at work. Or on the street - we have both lamppost chargers (trickle) here in London and dedicated chargers (look like parking machines) on High Streets. About 30% of UK households don't have their own dedicated parking spaces.

Since most North American homes have their own parking (I would venture 80% ish?) then installing chargers at home is not that difficult (basically a Level 2 charger will be the same size of circuit as your stove or your AC). Even condos come with parking spots? Cost per charger should be less than $2k (it could be a lot less). So less than the cost of upgrading your options package on a car.

In terms of how we use chargers, I think sharing models will also emerge. I am out in the day, so someone else parks in my driveway and charges. I note this because a colleague already rents her car out during the week (not sure the name of the App) and earns more than her car payment every month.

I doubt most car owners drive more than 200 miles per week (i realise it will be relatively high in North America) and that's more or less 1 full discharge of a car power pack now (picking Hyundai as an example). That's not insurmountably difficult to manage even with Level 1 chargers (ie power cords).

The high initial cost of EVs is a factor and a barrier to adoption. Even if Lifecycle Cost of ownership is lower. Batteries are a big chunk of that cost so it depends on how fast battery costs come down - historically they have shown steady declines.

I think it's one of those technologies that will hit a "tipping point". In the jargon of the S Curve of product adoption, it will "cross the chasm" from the experimentalists to the early adopters. I suspect that point has in fact already been reached in some places (15% of UK car sales in recent months have been EVs, although the 12m proportion is more like 5% -- and our charger network is anything but built out). I do notice how many EVs I see - and it's only the distinctive ones (like Teslas, BMW i3s etc) that I would notice.
in U.S. I am not sure where the electricity will come from. My area wants a lot of activities to start at midnight when usage is smaller. No brown outs, but lots of talk about alternative sources.

I also think you are optimistic about city streets having plug in spots when there is debate about garbage collection.

Median income households will happily put in the infrastructure to add charging to their homes. Newer garages may have electricity, but lots don’t.

I agree EV is coming. I just the timeframe is off. I would love an EV but no close source of electrify in the parking area of my condo.
000
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Re: TSLA: What Changed?

Post by 000 »

Since November, Elon Musk has sold 12,900,512 shares of TSLA with total proceeds of $13,627,020,798.39.
stormcrow
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Re: TSLA: What Changed?

Post by stormcrow »

000 wrote: Tue Dec 21, 2021 3:37 am Since November, Elon Musk has sold 12,900,512 shares of TSLA with total proceeds of $13,627,020,798.39.
That is a tax bill I would thoroughly enjoy.
rhoms33
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Re: TSLA: What Changed?

Post by rhoms33 »

stormcrow wrote: Tue Dec 21, 2021 11:32 am
000 wrote: Tue Dec 21, 2021 3:37 am Since November, Elon Musk has sold 12,900,512 shares of TSLA with total proceeds of $13,627,020,798.39.
That is a tax bill I would thoroughly enjoy.
Elon says he will pay over $11b in taxes. Crazy, crazy numbers.
caramou
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Re: TSLA: What Changed?

Post by caramou »

rhoms33 wrote: Tue Dec 21, 2021 2:31 pm Elon says he will pay over $11b in taxes. Crazy, crazy numbers.
I mean, he is taking the tax hit because he is choosing to sell shares to cover his tax liability for exercising stock options, otherwise the options expire (first set expired recently and next set expire next year). The guy makes it seem like he is voluntarily selling a 10% stake, when it looks like he could end up with the same or a larger ownership stake after exercising all of his options. The tax bill is supercharged because he owes ordinary rates on the value of the shares he is exercising in excess of the $6.24 share price at grant. He could have exercised his options just a few years ago and taken a much lower tax hit. Certainly an extreme illustration to look at when considering the pros and cons of when to exercise stock options. I also wonder whether he could have made 83b elections upon grant which would have further reduced his exposure to ordinary rates on the appreciation. Good problems to have in my opinion :wink:
4nursebee
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Re: TSLA: What Changed?

Post by 4nursebee »

What changed? Seems to be A LOT over the weekend!
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rhoms33
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Re: TSLA: What Changed?

Post by rhoms33 »

4nursebee wrote: Mon Jan 03, 2022 8:15 am What changed? Seems to be A LOT over the weekend!
308k cars delivered 4Q. HUGE beat.
harikaried
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Re: TSLA: What Changed?

Post by harikaried »

rhoms33 wrote: Mon Jan 03, 2022 8:51 am308k cars delivered 4Q
But what changed to allow for that? Looks like 21Q3 was 241k deliveries and 20Q4 181k, so 28% QoQ and 70% YoY. Some people were making a big deal about how Tesla failed to reach 500k deliveries in 2020 and only delivering 499,550; but in 2021 they seem to have delivered 87% more for 936k.

It doesn't seem like the new factories in Berlin and Texas have contributed to any of that growth.
Jags4186
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Re: TSLA: What Changed?

Post by Jags4186 »

rhoms33 wrote: Mon Jan 03, 2022 8:51 am
4nursebee wrote: Mon Jan 03, 2022 8:15 am What changed? Seems to be A LOT over the weekend!
308k cars delivered 4Q. HUGE beat.
Sure, now they just need to sell 30 million cars a quarter to justify their valuation.
rhoms33
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Re: TSLA: What Changed?

Post by rhoms33 »

Jags4186 wrote: Mon Jan 03, 2022 1:33 pm
rhoms33 wrote: Mon Jan 03, 2022 8:51 am
4nursebee wrote: Mon Jan 03, 2022 8:15 am What changed? Seems to be A LOT over the weekend!
308k cars delivered 4Q. HUGE beat.
Sure, now they just need to sell 30 million cars a quarter to justify their valuation.
Justify to who? You're excepting Nokia results from iPhone...
stocknoob4111
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Re: TSLA: What Changed?

Post by stocknoob4111 »

I remember when this was $200/share not too long ago and to think that it's now $6000/share is simply astonishing :shock:
Marseille07
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Re: TSLA: What Changed?

Post by Marseille07 »

stocknoob4111 wrote: Mon Jan 03, 2022 2:26 pm I remember when this was $200/share not too long ago and to think that it's now $6000/share is simply astonishing :shock:
Folks like Jason DeBolt retired on TSLA. They went all-in and paid off handsomely.
Nysoz
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Re: TSLA: What Changed?

Post by Nysoz »

Concentration builds wealth, diversification preserves it.

The way I try to get people to think outside the box on Tesla is to explain that even though Tesla and everyone else may make the same end product sooner or later (Tesla still has the best specs per $ spent for now), it's how they get there which is different.

Picture 2 companies that make the same product. One company makes the product 3 times faster than the competitor. At the same time, sells it directly to the consumer for 5-10x the profit compared to the others because there's no middle man. Also, When expanding their factories, each factory can be much smaller because of the way they make the product (or fit more manufacturing lines in the same space) and in turn costs much less for each new factory. All while the other company needs to slowly discontinue their old product that used to make them all their money and tries to make money on this new product.

That kinda explains their advantage in their auto manufacturing. It doesn't take into account any energy or ai lotto tickets that may be as big as the auto side.
smalliebigs
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Re: TSLA: What Changed?

Post by smalliebigs »

Nysoz wrote: Mon Jan 03, 2022 3:56 pm Concentration builds wealth, diversification preserves it.

The way I try to get people to think outside the box on Tesla is to explain that even though Tesla and everyone else may make the same end product sooner or later (Tesla still has the best specs per $ spent for now), it's how they get there which is different.

Picture 2 companies that make the same product. One company makes the product 3 times faster than the competitor. At the same time, sells it directly to the consumer for 5-10x the profit compared to the others because there's no middle man. Also, When expanding their factories, each factory can be much smaller because of the way they make the product (or fit more manufacturing lines in the same space) and in turn costs much less for each new factory. All while the other company needs to slowly discontinue their old product that used to make them all their money and tries to make money on this new product.

That kinda explains their advantage in their auto manufacturing. It doesn't take into account any energy or ai lotto tickets that may be as big as the auto side.
I don't know how much kool-aid you're drinking, but Tesla does not make 5-10x the profit margin compared to other OEMs. EVs currently are still more expensive to make than ICE vehicles. Traditional OEMs still have massive economies of scale and manufacturing experience. That "old product" is still >95% of the US market share. Also, there are a lot of emissions and fuel economy policies that influence OEM decisions, not because "Tesla is cool, let's be like them".
pjm
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Re: TSLA: What Changed?

Post by pjm »

Nysoz wrote: Mon Nov 29, 2021 3:17 pm

Comparative products or not, if Tesla is making a Model 3 in 10 hours and profiting $14k on each of them while VW is making an ID.3 in 30 hours while profiting $5.4k on each car then it shows that Tesla is doing something fundamentally different than OEMs.

https://twitter.com/forwardcap/status/1 ... 74466?s=20
Tesla makes $14k from the vehicle sale or from selling carbon credit. As far as I seen Tesla is not in the business of making cars, they loose money on them. They are in carbon credits business and bitcoin manipulation.
Soysauceonrice
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Re: TSLA: What Changed?

Post by Soysauceonrice »

pjm wrote: Mon Jan 03, 2022 8:12 pm
Nysoz wrote: Mon Nov 29, 2021 3:17 pm

Comparative products or not, if Tesla is making a Model 3 in 10 hours and profiting $14k on each of them while VW is making an ID.3 in 30 hours while profiting $5.4k on each car then it shows that Tesla is doing something fundamentally different than OEMs.

https://twitter.com/forwardcap/status/1 ... 74466?s=20
Tesla makes $14k from the vehicle sale or from selling carbon credit. As far as I seen Tesla is not in the business of making cars, they loose money on them. They are in carbon credits business and bitcoin manipulation.
This is pretty outdated. They are profitable even before accounting for the credits.
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