Tesla and Uber Unlikely to Survive...
Discussion
jjwilde said:
The big manufacturers will be having huge internal arguments with their unions and everyone who works on engines (etc).
This will tie them up for years yet.
Just looks at the hopeless efficiency of the Jag and Audi in comparison to the new Model S. That shows how Tesla are a generation ahead.
No one is even close to catching them and I've not even mentioned the supercharger network.
Or maybe VW has a better understanding of client demand and how to cater for it. It’s important to be honest and appreciate that Tesla has failed to prove that there is enormous global demand at these prices and the incumbent firms are not in the habit of building product that no one wants. This will tie them up for years yet.
Just looks at the hopeless efficiency of the Jag and Audi in comparison to the new Model S. That shows how Tesla are a generation ahead.
No one is even close to catching them and I've not even mentioned the supercharger network.
It’s folly to think that the other firms are behind in the way that you suggest because it shows a lack of basic economic understanding.
To mass product EVs you firstly need the mass production of battery cells and that will take up to a decade of infrastructure expansion and secondly you need the customers and they don’t exist in their millions. The only EVs being sold today are at the high end of the market and only where there are huge tax payer funded incentives. That isn’t a market you can launch a mass produced product for the people into.
All major firms are investing in EVs and we are in the end game for traditional ICE with few firms expanding any long term investment into them but you can’t build cars until you have the consumers to buy them and the supply of key parts to make them.
Tesla are not years ahead they are simply a different business on a different path to the same end.
They are not the best car builder in the world. They are not the best chip maker in the world. They are not the best solar panel maker in the world. They are not the best battery maker in the world. They are not the best minicab firm in the world. The fact that one bloke keeps rabbiting on about being the best at everything and calling everyone else idiots does not make any of it true.
And the fact that he has just tipped his stock price through $250 clearly suggests that the entire world of ‘idiots’ is becoming bored with his snake oil.
Heres Johnny said:
And china is crucial to selling 10k a week, and there's little hope at the moment without a new market coming on strong.
I don't think we have had a 'clean' enough quarter without noise, to state that definitively. Musk claims demand for Q2 is looking similar to Q4. It's so bold a claim, that if not true, then surely all credibility is lost. And what is Musk without hope? Surely he can't get away with such poor guidance for long.
Maybe I haven't been invested long enough to have seen it all before.
Edited by anonymous-user on Thursday 25th April 16:25
DonkeyApple said:
They are not the best car builder in the world. They are not the best chip maker in the world. They are not the best solar panel maker in the world. They are not the best battery maker in the world. They are not the best minicab firm in the world.
Sales and specs do lend some credence to the perception.
I say 'perceive today' to caveat the obvious objections.....
Any chance you can put all your future speculation stuff in a footnote donkey, as the present day comments are interesting, but the 5 year forecasts are a trawl to get through and you have said it all many times before.
Edited by anonymous-user on Thursday 25th April 17:08
sambucket said:
DonkeyApple said:
They are not the best car builder in the world. They are not the best chip maker in the world. They are not the best solar panel maker in the world. They are not the best battery maker in the world. They are not the best minicab firm in the world.
Sales and specs do lend some credence to the perception.
I say 'perceive today' to caveat the obvious objections.....
Any chance you can put all your future speculation stuff in a footnote donkey, as the rest is interesting, but a trawl to get through
Edited by sambucket on Thursday 25th April 16:43
Even if they are the best EV maker I would say, so what. There isn't enough demand at that price point. They are also supply constrained and have limited capital resources. In 5 years of hard growth and a stroke of luck they may justify todays valuation. My call is he may well take the company private in a year or so and if he does it's because it's not working out as he hoped.
Burwood said:
He's not a hater as some would suggest, just eyes wide open and a healthy dose of scepticsm. Look at the valuation.
Even if they are the best EV maker I would say, so what. There isn't enough demand at that price point. They are also supply constrained and have limited capital resources. In 5 years of hard growth and a stroke of luck they may justify todays valuation. My call is he may well take the company private in a year or so and if he does it's because it's not working out as he hoped.
Sure, but a little brevity never hurt anyone. Even if they are the best EV maker I would say, so what. There isn't enough demand at that price point. They are also supply constrained and have limited capital resources. In 5 years of hard growth and a stroke of luck they may justify todays valuation. My call is he may well take the company private in a year or so and if he does it's because it's not working out as he hoped.
I don't think going private is an option any more.
His pay structure disincentives Tesla being a car company so it's not a mystery really he is pushing the company into areas that could conceviably at great risk, push the company past 100bn. That might have been EVs at one point but macro factors have ruled it out until 2021 at least, so in the mean time, blade runner it is.
Edited by anonymous-user on Thursday 25th April 16:56
sambucket said:
Heres Johnny said:
And china is crucial to selling 10k a week, and there's little hope at the moment without a new market coming on strong.
I don't think we have had a 'clean' enough quarter without noise, to state that definitively. Musk claims demand for Q2 is looking similar to Q4. It's so bold a claim, that if not true, then surely all credibility is lost. And what is Musk without hope? Surely he can't get away with such poor guidance for long.
Maybe I haven't been invested long enough to have seen it all before.
Edited by sambucket on Thursday 25th April 16:25
The problem they have is they set the expectation bar at 35k, they make 20% margin on the M3 and I imagine the average selling price has been nearer 50k or maybe higher, 20% margin on a 50k car means the cost is 40k, and its not really much cheaper to make the base car (not that they're even trying). So even 40k Standard plus models are hardly making a profit using my fag packet maths.
China needs to be a cash cow for them, but I think generally thats not how China works. They will want to be a net exporter.
This type of maths is whats taking the share price to 250 and under. Makes the 430 take private seem a very long way away.
Heres Johnny said:
Last year they chewed through the US order book, they cut US deliveries to service Europe, lets say roughly half the production is in the US market and they are still making stock for inventory in the US and Canada - ie the US market based on Q1 looks to be sub 2.5k a week or 125k M3 cars annually. The US historically has been more than the sum of other markets, so the dust could well settle at maybe 225k M3 a year and made up to 200-250k with MS and MX sales based on current markets. To sell over 5k a week they need new markets desperately and its a long way short of Musks 400-500k guidance.
The problem they have is they set the expectation bar at 35k, they make 20% margin on the M3 and I imagine the average selling price has been nearer 50k or maybe higher, 20% margin on a 50k car means the cost is 40k, and its not really much cheaper to make the base car (not that they're even trying). So even 40k Standard plus models are hardly making a profit using my fag packet maths.
China needs to be a cash cow for them, but I think generally thats not how China works. They will want to be a net exporter.
This type of maths is whats taking the share price to 250 and under. Makes the 430 take private seem a very long way away.
I generally agree and feel 250 is likely to be upper range for a while and fair enough. The problem they have is they set the expectation bar at 35k, they make 20% margin on the M3 and I imagine the average selling price has been nearer 50k or maybe higher, 20% margin on a 50k car means the cost is 40k, and its not really much cheaper to make the base car (not that they're even trying). So even 40k Standard plus models are hardly making a profit using my fag packet maths.
China needs to be a cash cow for them, but I think generally thats not how China works. They will want to be a net exporter.
This type of maths is whats taking the share price to 250 and under. Makes the 430 take private seem a very long way away.
But I still argue that we haven't had a long enough period of time to judge what ongoing demand might look like. The tsunami came in Q4, retreated in Q1`, and Q2 will be interesting indeed to see where the real tide line is.
Why is why I really hope 90k guidance is in line, not because I particularly care what 2019 sales are, but because if it is not, there really is no excuses left for such inaccurate guidance.
You’d expect 2019 Q2 to be the same or higher than 2018 Q4 in terms of deliveries as the factory should be building more than back then as they sort out the mess of building the 3. They still have most of the EU pre-order book to fulfil and they have the 10000 3s from Q1 they couldn’t deliver on time. Plus, they have the $35k car if you phone them up and manage not to be talked into a more expensive car via the discussion about how fuel savings really make it $10k cheaper than you think and the minicabbing revenues next year will get all of the rest of your money back. (Obviously anyone calling up to buy the $35k car will be recording their conversation to help with their later filings to get all their money returned under a misspelling claim).
But just as US consumer demand fell dramatically once all the pre-orders were filled, the same is going to happen in the EU later in this year and China and then we get to see what real underlying demand is.
But just as US consumer demand fell dramatically once all the pre-orders were filled, the same is going to happen in the EU later in this year and China and then we get to see what real underlying demand is.
sambucket said:
By that logic, we should be able to extrapolate underlying demand from Q2 US sales. Presuming tesla soaks up any tax credit stuff.
You can see it in the Q1 figs. It’s why so many people were trying to explain all during Q42018 why those domestic numbers wouldn’t be sustained. What caught the market by surprise was the big Q1 reduction in the S and X figures. Q1 is always lower than Q4 in the US but it was a bigger than expected decline in the two products that carry lots of unit profit. We can generally expect the EU figures to follow a similar path.
A real problem is just how essential subsidies and grants are and global changes in these have a huge impact on demand. What would really benefit Tesla this year is any increase by a country in those.
DonkeyApple said:
You’d expect 2019 Q2 to be the same or higher than 2018 Q4 in terms of deliveries as the factory should be building more than back then as they sort out the mess of building the 3. They still have most of the EU pre-order book to fulfil and they have the 10000 3s from Q1 they couldn’t deliver on time
Apologies for jumping with a likely stupid question. But how did this order book work? People just basically reserved a slot for any variant of model 3? Or did they have to commit to a version along the (waiting) line?Because looking at e.g. the German website, you can have a LR AWD (€ 54.8k) or Performance AWD (€ 64.6k) delivered in May. Local Tesla forums confirm fairly rapid delivery of cars. The "plus" version of the $ 35k car is € 44.5k over here and no estimated delivery time.There's also a LR RWD version that is not shown on the website but advertised by email.
Hm. Just trying to sell as much higher priced versions as possible? But then why not advertise the LR RWD model 3?
EddieSteadyGo said:
Are Tesla actually making the chip, or did they just do the design work? I expect they are actually subtracting the production of the chip to a third party. If that is the case, the production techniques won't be unique.
Maybe they have optimised for power usage or designed to chip to work well with what their software needs. But I'm highly sceptical that the reason they choose to do this "in house" was because the alternative suppliers weren't sufficiently competent.
And Musk is already saying they are working on the next generation of chip, which will be significantly faster than this one. Which is what you have to do if you become a chip designer. But surely it becomes a distraction and unnecessary use of resources when you are trying to fight on so many fronts?
I'd have thought it was better to focus on reducing battery costs above all else, and trying to improve the efficiency of their car production facilities. Get that right, and their addressable market opens up massively.
Tesla never intended to produce the chip. Currently fabd by Samsung on 14nm. Maybe they have optimised for power usage or designed to chip to work well with what their software needs. But I'm highly sceptical that the reason they choose to do this "in house" was because the alternative suppliers weren't sufficiently competent.
And Musk is already saying they are working on the next generation of chip, which will be significantly faster than this one. Which is what you have to do if you become a chip designer. But surely it becomes a distraction and unnecessary use of resources when you are trying to fight on so many fronts?
I'd have thought it was better to focus on reducing battery costs above all else, and trying to improve the efficiency of their car production facilities. Get that right, and their addressable market opens up massively.
The production of it is nothing special.
DonkeyApple said:
Tesla are not years ahead they are simply a different business on a different path to the same end.
How do you explain the horrible efficiency of the Jag and Audi then? Also have you seen how bad the Jag infotainment screen is compared to Tesla's?A 2012 Tesla is better because of the over the air updates, other manufactures are very very hesitant to this due to pressure from dealers for example.
I know the Jag has it but it's not going to improve the hopeless efficiency.
Also... the supercharger network?
Kolbenkopp said:
Apologies for jumping with a likely stupid question. But how did this order book work? People just basically reserved a slot for any variant of model 3? Or did they have to commit to a version along the (waiting) line?
Because looking at e.g. the German website, you can have a LR AWD (€ 54.8k) or Performance AWD (€ 64.6k) delivered in May. Local Tesla forums confirm fairly rapid delivery of cars. The "plus" version of the $ 35k car is € 44.5k over here and no estimated delivery time.There's also a LR RWD version that is not shown on the website but advertised by email.
Hm. Just trying to sell as much higher priced versions as possible? But then why not advertise the LR RWD model 3?
So no SR+ available in Germany at all? Or just sold out for now? I think it's basically a reservation. I've heard of upselling going on once the delivery date arrives. i'm guessing tbh. Seems the 35k is mostly marketing at this point.Because looking at e.g. the German website, you can have a LR AWD (€ 54.8k) or Performance AWD (€ 64.6k) delivered in May. Local Tesla forums confirm fairly rapid delivery of cars. The "plus" version of the $ 35k car is € 44.5k over here and no estimated delivery time.There's also a LR RWD version that is not shown on the website but advertised by email.
Hm. Just trying to sell as much higher priced versions as possible? But then why not advertise the LR RWD model 3?
Edited by anonymous-user on Thursday 25th April 21:55
jjwilde said:
How do you explain the horrible efficiency of the Jag and Audi then? Also have you seen how bad the Jag infotainment screen is compared to Tesla's?
A 2012 Tesla is better because of the over the air updates, other manufactures are very very hesitant to this due to pressure from dealers for example.
I know the Jag has it but it's not going to improve the hopeless efficiency.
I've used both the Jag and Tesla (M3 and X) infotainment. Tesla's version is better, no question, but not by that much. To call the i-pace "bad" is overstating the differences.A 2012 Tesla is better because of the over the air updates, other manufactures are very very hesitant to this due to pressure from dealers for example.
I know the Jag has it but it's not going to improve the hopeless efficiency.
In terms of the efficiency, the i-pace was overall similar in real world tests to the model x, particularly at lower speeds. At higher speeds, it struggles due to its poorer drag. (Traditional auto companies are going to need to adjust their design ethos if they want to maximise the range of EVs.)
The Audi probably suffers from the same point, compounded by an ultra-conservative amount of the battery being reserved from normal use.
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